Car Leasing / Contract Hire ?

ioscorpio

I'm seriously thinking about getting a car on lease rather than buying one, I'm newly self employed so might as well have a decent car.

What are the catches, besides the mileage cost if you go over the contracted miles or any damage to the vehicle? I know there's the monthly payments, but is there any specific questions to ask that relate it it being a good deal?

Hintza

In the middle of my first one, so don't know all the answers but the important ones are:-

1. How much for dings and scratches etc mine is OK and its about £100 a scratch but sods law applies on these cars, mine will be in a mates body shop befoe it goes back.

2. Servicing, just make sure you are clear on that.

My biggest headache was my totally unrealistic assumption on my mileage. Three months into a 12 month contract of 10,000 miles and I'm already over 6,000. Its going to be a big ouch.

So another question I would ask is do you give a discount at end of contract for milage allowance that is unused? I doubt they will but I will certainly be asking tha the next time.

plane_boy2000

Hintza - have you tried calling them to renegotiate the mileage - i believe some companies will allow you to ammend mid term, and it may be cheaper than taking the hit at the end. worth a call.

Hintza

plane_boy2000 wrote: »

Hintza - have you tried calling them to renegotiate the mileage - i believe some companies will allow you to ammend mid term, and it may be cheaper than taking the hit at the end. worth a call.

Good idea!!

I actually hadn't thought of that but i might do that in a month or so. Had a family problem a few months ago which meant I ended up with four x 800-1,000 trips that weren't expected. I hope things have stabilised a bit and will maybe wee where I am at month six.

Was actually thinking I might make an offer on the car at the end of the period will have to see how residuals look at that time.

nickmack

ioscorpio wrote: »

What are the catches, besides the mileage cost if you go over the contracted miles or any damage to the vehicle? I know there's the monthly payments, but is there any specific questions to ask that relate it it being a good deal?

As Hintza said, definitely be realistic on the mileage and check the excess charge per mile.

Check servicing intervals for the car against the hire period, so you don't end up paying for an extra service (assuming you're not on maintenance)

The cheapest contract hire deals are for cars that depreciate slowly in the first 2-3 years.

Remember you will have to insure it yourself, so get quotes for that also before you sign up. You may want to consider GAP insurance in case the vehicle is written off (assuming your insurer does not do new for old cover). Shop around though as the contract hire company may not offer the cheapest or best policy.

Be aware of the payment terms. The most popular profiles are 3+23 and 3+35 (3 monthly payments initially and then 23 or 35 month at the monthly rate). Some firms will quote 3+24 or 3+36 to reduce the monthly payment slightly. Work out the total cost over the hire period.

ioscorpio

Obviously servicing is an important fact, is it worth having the "with maintenance" or not

I know Citroen service interval is 20,000 miles, so effectively you don't need to have the car serviced if you are on a 10,000 miles per year contract

Which other manufacturers have a 20,000 miles service period?

plane_boy2000

Most VW and Audi have long life servicing so you can expect longer service intervals - my partner is regulary seeing 17 - 18K before the light comes on.

You need to check that citroen servicing is not yearly or 20K as you would still end up having a service at 12 months anyway. The VW one can run for up to 24 months before the light come on.

I suspect that the terms of your contract would be that the car needs a full history upon return, so even on a 2 year / 20K contract you may end up having to get the service done just before its return.

ioscorpio

I looked at a Suzuki Swift today as I have seen a deal for £98 per month, but the service interval is 9,000 and costs £120, but the guy said he's mate has a Vw with 20,000 service interval but i costs £360 or £380 can't remember, so it don't work out any cheaper

ioscorpio

Which ins so will insure a lease/contract hire car as I have spoken to mine but they said you have to be the registered owner

plane_boy2000

ioscorpio wrote: »

I looked at a Suzuki Swift today as I have seen a deal for £98 per month, but the service interval is 9,000 and costs £120, but the guy said he's mate has a Vw with 20,000 service interval but i costs £360 or £380 can't remember, so it don't work out any cheaper

My VW dealer charges about 250 for a 20K service so its apples for apples, but the benefit for me of long life servicing is that at 20K a year I am only going to the dealer once a year rather than 2+ times. At the end of the day I have better things to be doing than sitting in the garage while they service my car

spiggles

does anyone know what happens if you are unable to keep up repayments part way through one of these plans (ie Ford Options) , i know the car can be repossessed, but does anyone know what other penalties are payable. Reason i ask is that a friend is a guarantor on a family members plan and they are now unable to continue payments (about a year into the plan) - at the moment I am unable to get a copy of the terms and conditions. Any help appreciated. thanks