Leasing vs Contract Hire vs Buying a Car...List the pro's and con's.

zaq12wsx

After seeing that leasing cars was on the up, and needing a new car for work - I decided to weigh up the pro's and con's.

One thing I hadn't bargained for was the need for GAP INSURANCE.
Should my car be stolen and/or written off, the gap in value between how my insurance company values it and what my lease company wants back could mean a fair few thousand pounds I wasn't planning to shell out.

So an extra £246 in insurance was a wise expenditure - but it was £246 I wasn't expecting to spend.
Has anyone else got any pro's and con's to look ou for?

Hintza

Debatable on whether you need it at all. At least some insurance companies will replace a car upto 12 months with a new one. Also I think if you search around you could probably find it significantly cheaper.

Lots of pro's with leasing.

Some of the cons:-

Excess milegae; you need to know exactly how much that is going to cost.

Scrapes and small dings can be expensive.

Factor in a valet at the end of the lease

Some insurance companies might not insure you or it could be more expensive.

hewhoisnotintheknow

i dont like company / lease cars as if you have a change in your life, redundancy, sickness emigration, you are stuck with having to giving back the lease car then having to fork out for a new one or whatever

Hintza

hewhoisnotintheknow wrote: »

i dont like company / lease cars as if you have a change in your life, redundancy, sickness emigration, you are stuck with having to giving back the lease car then having to fork out for a new one or whatever

Excluding company cars. Keep leases short, I prefer 12 months and can the budget for that. If your finances can't cope with emergencies then a lease might not be a good idea.

taff007

Would agree that you need to be sure you can afford/want the car for the full term as handing the car back early can be expensive.

As Hintza said, may not be a big issue, but I've found insurance can be a little more difficult to sort out. For my wife's (owned) car I generally go through quidco and got £70-£100 cashback. For my leased car I've needed to phone the insurers direct and then quidco doesn't apply. Not a deal breaker but needs to be factored into the cost.

Didn't bother with GAP due to the insurance replacement policy for cars less than 1 year old.

I do like the fact that I know exactly how much the car will cost me for 2 years. I've got maintenance included on mine so I've had no surprises for tyres/servicing costs. I've Just had 4 runflats replaced at Kwikfit which would have cost £140 each. Also very nice feeling when new tax disc arrives without forking out any extra money (I know it's in the price but still feels good)

I really like the fact that I can afford a brand new BMW every couple of years, which I certainly couldn't if I bought new.

zaq12wsx

taff007 wrote: »

Would agree that you need to be sure you can afford/want the car for the full term as handing the car back early can be expensive.

As Hintza said, may not be a big issue, but I've found insurance can be a little more difficult to sort out. For my wife's (owned) car I generally go through quidco and got £70-£100 cashback. For my leased car I've needed to phone the insurers direct and then quidco doesn't apply. Not a deal breaker but needs to be factored into the cost.

Didn't bother with GAP due to the insurance replacement policy for cars less than 1 year old.

I do like the fact that I know exactly how much the car will cost me for 2 years. I've got maintenance included on mine so I've had no surprises for tyres/servicing costs. I've Just had 4 runflats replaced at Kwikfit which would have cost £140 each. Also very nice feeling when new tax disc arrives without forking out any extra money (I know it's in the price but still feels good)

I really like the fact that I can afford a brand new BMW every couple of years, which I certainly couldn't if I bought new.

Thanks Taff, could you explain quidco for me?

albionrovers

Mine =
Lingscars
Audi A3
£214/month inc VAT, 3+23.

chunkster_uk

albionrovers wrote: »

Mine =
Lingscars
Audi A3
£214/month inc VAT, 3+23.

Albion, that sounds like a great deal. I'm changing jobs, so looking into getting a short term lease, any tricks to getting your deal, or was it straight forward?

Ta.

albionrovers

I ordered in July before the new 58-plates were released. Think the price has risen now. But to answer your Q, it was a standard deal straight from the website.

Deals change constantly, I would subscribe to a few car leasing websites, I still get bombarded with deals to my hotmail address. There is a deal on the A3 S-line via 1 broker just now but I didn't pay much attention because my car has been delivered.

boots_babe

Just came across this thread as I'm trying to decide whether I need GAP insurance for a new personal contract hire I've just signed up for. Car isn't being delivered for a week or so, so I have a little while to decide.

Pretty good deal I thought - £287 inc VAT on 3+23 for 2yrs Mercedes SLK. I was concerned about replacement costs in case of any accident, but having read on here that some car insurance replaces with a new car if under 1 year old, I think I need to look into that.

So those of you who have decided against GAP insurance because your normal insurance will replace with new under 1 year old, are you planning to take out GAP insurance once the car is 1 year old?

beach86

I am also looking to lease. Anyone got any recommendations of some of the cheapest companies?