Car Leasing

angeldelight01

Does anyone have any advice regarding car leasing? Im in need of a new car soon but cant afford to buy one at the moment. Ive been advised by a number of people to look into Car leasing? Ive been told that I will be able to apply for a brand new car then make payments for it each month and hand it back after 3 years. Ive also been told that for the 3 years I keep the car I dont pay for any of the servicing and only for the insurance? Does anyone know of any reputable car leasing companies?

alx33277

Servicing can be included in the deal, as can insurance in certain wrapped products like Peugeot's 'just add fuel'. nationwide have a good reputation for mainstream leasing and moneybarn if you have any credit issues...Have said it before, but look at small print in any leasing contract as exiting early can be v v painful! HTH

Wh05apk

For the cost of anything decent, whi not just get yourself a bank loan paying the same and buy a 2/3 yr old car, at least in 2/3 years you will still have something worth selling for a deposit on your next one?

Idiophreak

Wh05apk wrote: »

For the cost of anything decent, whi not just get yourself a bank loan paying the same and buy a 2/3 yr old car, at least in 2/3 years you will still have something worth selling for a deposit on your next one?

a) you'll have an older car
b) you'll have to pay for MOTs
c) monthly payments will likely be more
d) you'll have a large debt on your credit file
e) you'll have uncertainty as to the final value of the car, have to sell it etc

That's just off the top of my head...

alx33277

a) you'll have an older car - so it will have been through the worst of the depreciation curve
b) you'll have to pay for MOTs - £35 x 3? = not a lot.
c) monthly payments will likely be more - not by much - see below
d) you'll have a large debt on your credit file
a lease is still a credit agreement
e) you'll have uncertainty as to the final value of the car, have to sell it etc
But you will have an asset with some value at the end of the agreement - a lease leaves you with nothing.

Look at nationwide's front page offer - a Nissan Note 1.5dCi.

£839 initial payment then £167.94 over 3 years (excluding servicing but including RFL). Total amount payable without servicing is £6,884.84.

Consider a 3 year old car with average mileage and same spec and you're looking at around £6,000. With a loan taken out over three years with say Sainsbury's Finance, that's a monthly repayment of £186.99. So, £19.05 a month more, but no deposit or initial rental required, so the amount payable over the three years is probably slightly less. And, you have something to show for your purchase at the end of the agreement...not to be sniffed at...

Personal leasing IMHO isnt a great financial proposition...HTH

whatmichaelsays

Personal leasing can work well if you are the sort of person that changes car every three years or so. I'm not necessarily into the idea of "having something" at the end of my finance agreement. At the end of the day, used cars are a money pit and the idea of having £x,000 tied up in an "asset" that depreciates by the day isn't that appealing.

Yes, if you keep hold of your cars for 5/6 years+ then buying outright is a better idea, although I'd question your sanity if you were planning on buying brand new in that case when there are plenty of perfectly good nearly new / ex demos sitting on forecourts across the country.

Idiophreak

alx33277 wrote: »

a) you'll have an older car - so it will have been through the worst of the depreciation curve
b) you'll have to pay for MOTs - £35 x 3? = not a lot.
c) monthly payments will likely be more - not by much - see below
d) you'll have a large debt on your credit file
a lease is still a credit agreement
e) you'll have uncertainty as to the final value of the car, have to sell it etc
But you will have an asset with some value at the end of the agreement - a lease leaves you with nothing.

Look at nationwide's front page offer - a Nissan Note 1.5dCi.

£839 initial payment then £167.94 over 3 years (excluding servicing but including RFL). Total amount payable without servicing is £6,884.84.

Consider a 3 year old car with average mileage and same spec and you're looking at around £6,000. With a loan taken out over three years with say Sainsbury's Finance, that's a monthly repayment of £186.99. So, £19.05 a month more, but no deposit or initial rental required, so the amount payable over the three years is probably slightly less. And, you have something to show for your purchase at the end of the agreement...not to be sniffed at...

Personal leasing IMHO isnt a great financial proposition...HTH

The thing you're left with is 6 years old or so and probably worth a couple of grand.

Take off a few hundred to correct your rather optimistic 3x£35 for MOT and you're looking at a total extra cost of, say £2000. Which, over 3 years is something like £50/month extra. Now, assume you do a moderate mileage, say 1000 miles a month...It's entirely possible that having a 3 year newer car could improve economy by 20% - so maybe that's a saving of 20 or 30 quid per month. Take off the car tax at a tenner a month...

Then you're left with it costing 20 quid a month extra to drive a brand new car around, have it all neat and shiney, get the new car smell, none of the kerbing and so on. - and you don't need to worry about selling the thing when the three years runs out - you just hand it back. Some people will think that's worth the extra, some people won't. Pay your money and take your choice.

Personally, I don't lease - but I have no problems with the idea of a car as a service and am happier driving newer cars.

I think as long as you shop around and make sure that the car's good value in your own budget, it's a perfectly sensible option.

Wh05apk

Idiophreak wrote: »

The thing you're left with is 6 years old or so and probably worth a couple of grand.

Take off a few hundred to correct your rather optimistic 3x£35 for MOT and you're looking at a total extra cost of, say £2000. .

If you buy a 2/3 year old car, then it is unlikely you will have much to pay in repairs over 2/3 years, my last few cars - Rover 600, I sold at about 8/9 years old and never needed anything at the mot, or anything apart from one set of brake pads in 80,000 miles, my wifes BMW 323 is 13 years old with 105,000 miles on and has probably cost £200 in additional work at MOT (suspension bushes), £60pm for MOT work is totally OTT.

If you buy a decent modern car, on the whole now they are reliable and if serviced properly will be reliable.

Idiophreak

Wh05apk wrote: »

If you buy a 2/3 year old car, then it is unlikely you will have much to pay in repairs over 2/3 years, my last few cars - Rover 600, I sold at about 8/9 years old and never needed anything at the mot, or anything apart from one set of brake pads in 80,000 miles, my wifes BMW 323 is 13 years old with 105,000 miles on and has probably cost £200 in additional work at MOT (suspension bushes), £60pm for MOT work is totally OTT.

If you buy a decent modern car, on the whole now they are reliable and if serviced properly will be reliable.

I had an 04 plate Astra that needed something like £1500 of work at MOTs between years 3 and 5 - then I sold it, as I was advised there was another £1500-2000 of stuff needed doing next time around.

I'd suggest that neither of our experiences are wholly typical...

Lessbutbetter

I had an 04 plate Astra that needed something like £1500 of work at MOTs between years 3 and 5 - then I sold it, as I was advised there was another £1500-2000 of stuff needed doing next time around.

not a typical experience but being a vauxhall...

If you buy a decent modern car, on the whole now they are reliable and if serviced properly will be reliable.

Great advice if by "decent modern car" you mean German.

fivetide

Lessbutbetter wrote: »

not a typical experience but being a vauxhall...

Great advice if by "decent modern car" you mean [STRIKE]German[/STRIKE] Japanese.

Fixed that for you.

5t.