PCP, lease or personal loan? Car finance

Dizzy651

Hi

If you're using PCP with the intention of trading in at the end to get a new one, is this better than leasing or not? I'm going to assume there will be no equity above the GFV.

I'd probably put down £2-4000 deposit (and use the balance from my car sale to pay off the loan I already have unless it makes more sense to put down about£8000 deposit). Any thoughts on that too please?

Is it better to look at buying a car with the sale monies from my existing car (around £8500), even if it's going to be older (2011-2013)? I am paying £100pm for another 4 years on this.

I will do around 18000 miles per year.

Thanks

JamesGreene

It's better to leasing then to buy a car. Because when you lease your car then you can change it after a short time according to your time.

Mercdriver

JamesGreene wrote: »

It's better to leasing then to buy a car. Because when you lease your car then you can change it after a short time according to your time.

Depends on the length of the contract. If you sign a contract for a 3 year lease, there will be penalties for leaving it early, if it's even possible.

tacpot12

I'd probably put down £2-4000 deposit (and use the balance from my car sale to pay off the loan I already have unless it makes more sense to put down about£8000 deposit). Any thoughts on that too please?

If it makes more sense to put down about £8000, I'd go with the sensible option. :-)

But to answer your question; if you are not likely to want to keep the car at the end of the contract, leasing should be the better option, but the lease company will have to figure out a GFV for their calculations, and as a result the cost is likely to end up very similar, if not identical.

andrewf75

If you want to save money buy a car outright.
Leasing is comparable in cost to owning outright if you buy new and change cars every few years. Buying second hand and keeping for longer is a MUCH cheaper way of owning a car.

neilmcl

It seems a lot of people are confusing PCP and leasing as being one and the same. I'm sure the OP was specifically asking the difference between PCP and traditional leasing, eg Personal Contract Hire (PCH).

OP, if you're not planning on keeping the car then traditionally leasing (PCH) can be cheaper but you won't be afforded the same options and financial protections you'd get taking out a PCP agreement.

Dizzy651

Thanks all.