Personal Car Leasing

robmurphy

For the past few years, I've bought our family cars using a PCP (the old fashioned 50/50 'bubble' payment). But I'm now considering using a personal car lease for our next car. Both PCP and leasing have monthly payments over 2 to 4 years and both have an pretty large initial payment. Does anyone have any experience of leasing cars privately (my work car is leased and this seems fairly sensible/easy)? Just wondered which option people think the best route for a new car.

Lifes_Grand_Plan

If you are only considering new cars and know you will want to upgrade in a few years then IMHO it is one of the best ways to go about it. Your monthly payments are fixed and you are only financing the use of the car for the time you have it, not financing the whole thing.

Lings Cars is one of the best out there because they include VAT in their prices which you will have to pay on a personal lease, and they always work on a "3 + X" basis, i.e. the deposit is always 3 x the monthly payment amount. So you don't have stupidly high deposits up front.

Hope that helps but if you've got any specific questions then ask away (although i'm no expert)

Forgot to mention, the above is based on my experience of leasing my own car personally.

Things to look out for - excess mileage charges and charges for damage to the vehicle.

I suppose the downside to car leasing is that you are basically taking the depreciation hit for the manufacturer and we all know depreciation is highest in the first 3 years... so if you don't want to be left with no car at the end then leasing is not for you....

To note, when I hand my lease car back in March, I won't be leasing again.... when you calculate the amount you will spend leasing x the number of payments... the sums of money you see "down the drain" upset the money saver in me... i'll be going for nearly new or even something a bit older in future.

Example:

Volvo V50 Sportwagon 1.6D on Lings is £283 on a 3 + 17....

That is a very good price for a car, especially on such a short lease... they are normally very expensive on short leases and a bit less expensive on longer leases...

But when you work it out, (3 + 17) 20 x £283 = £5600 odd....

Thats a lot of money for a year and a half loan of a car...

Doozergirl

I looked into it, compared the car I was looking at on both deals, picking the similar amount of money for the PCP deposit as for leasing. The PCP was a bit more expensive at the time, however, if I'd not have specified so many extras, the price difference would have been negligable.

Where PCP is better is that you don't have that total panic at the end to try and make sure your car is pristine or panicking about the mileage charges as you can sell the car yourself. Handing it back is the worst case scenario if values fall. You can buy a nearly new car on PCP and save a bit more there and, if things do go financially wrong, job loss etc, you can sell the car whereas with a lease you are totally tied in.

And the best thing of all? After three years on a PCP deal, I actually have £2500 euity in the car, even trading it in, agreed last week so I'm definitely up on the deal compared to leasing. So I don't have to pay a deposit and the payments are down a bit for the next few years.