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Advice needed: buying cheap car vs leasing/long term rental

Hi All,

After many months of unemployment I have a new job. Problem is that it is quite far away so will need a car to commute to work, 1 hours motorway driving each way, plus some London roads.

Was looking to spend up to 2k for a second hand one, but my parents pointed out I will need to consider the cost of repairs and potential issues with a 2nd hand one.

They mentioned I could consider leasing a car as an option, eg pay £200 per month over 3-4 years then hand back the car at the end.

Anyone investigated the leasing option? Any thoughts / advice.

Cheers,

J

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Comments

  • Posts: 629 Forumite
    Cheap car every time, loads out there for cheap money, small diesel, (Citroen C2, Corsa, etc) 'shouldn't' have any problems. Problem with the lease is you are paying 200 per month, so 2400 per year, so you are already over your 2 grand budget, and at the end you still don't own the car - no brainer, you still have to pay insurance etc
  • Posts: 32,755 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    Something a bit older in mint condition for £1000 but cheap as chips to fix.

    £1000 kept back for repairs will fix virtually everything. get many years worth of motoring for £2000.

    Or £2000+ a year to rent a car?

    Buy buy buy...
    Censorship Reigns Supreme in Troll City...

  • cheers guys, i guess am nervous of the risk of buying a dud...
  • just revisiting this.

    It occurred to me that this would be my first time getting my own insurance, am 33 now but have held my licence since 18 yrs old, but was always on other people's policies and haven't really drived much for the last 5 years while living in London (other than zip car scheme)

    Been doing a few checks for insurance quotes and seeing figures of around 900 - 1k per year OUCH! although I assume this would go down every year with a no claims bonus.

    Suddenly these leasing schemes which often include insurance don't look so unaffordable, does anyone know of any sites where you can compare the schemes to each other and vs. second hand or new car purchases?
  • Posts: 32,755 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    They wont compare to a 2nd hand car purchase.

    Buying an older car with no bells and whistles to go wrong is a good option when on a budget.
    Trick is not to spend all your budget buying it.

    Google Ling Cars. Terrible website but good reviews.
    Censorship Reigns Supreme in Troll City...

  • Posts: 1,460 Forumite
    edited 25 October 2012 at 6:32PM
    cheap car. If that breaks another cheap car. Buy 2 cheap cars of the same type

    Even with a year the workplace could probably still say you have not fitted in, so will not make you a permie. Can go bankrupt. Can have a new business strategy with you not in it. They may reallocate you - possibly outside the country. You can fall ill, or be disabled in many ways. Wife falls ill, and you may end up being the care giver and have to give up work.

    The greater chance this will not happen to you, there is a slim chance that this will happen. At work this year out of about 200 people, this ear alone we have already had 5 off long term or resign due to sickness. 3 have been fired and 2 left for walkabout - they were sick of the job. Then about 20 were let go for various reasons.

    Should you be out of work, you will be still liable for the payments for the rest of lease period, especially hard to do with no money coming in. Also when the lease period ends you probably will have no car too. L for lease and L for liability

    Buy the car and it is a depreciating asset, but never the less an asset - hopefully not a too costly asset.

    A car leased by the company for you is not as bad, providing the company holds the lease and not you.

    buy wise with your head my friend
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