PCP v Leasing (personal or through work)

omariqy

Hello all

I am debating buying a new car (Mini SUV/Crossover) and I have been looking at PCP and lease deals. I am planning on changing my car every 3 years or so. I am not sure which route to go down. PCP seems like a good option as you have some residual value left in the car. Leasing is also good because of the lower monthly payments. Re: Leasing I can actually buy through my work but it seems better that I do it personally as through work it is a P11d benefit and therefore not only do I pay roughly the same price as I would personally but I also have to pay income tax on it. Am I missing something or is that the right conclusion?

Anyways, my questions are which is the better option and also any good recommendations on cars?!

Many thanks

Omar

Shaka_Zulu

You have to do the sums carefully and see which offers the best deal.

The big unknown with a PCP is what is the future value after 3 years. You can make a stab at it but in the end will depend on market forces.

You will get a better deal on leasing less popular cars or ones that are about to be replaced by a new/facelifted model.

If you want the best deal go for the deal and not the make/model. It's value after the deal is irrelevant to you.

omariqy

Shaka_Zulu wrote: »

You have to do the sums carefully and see which offers the best deal.

The big unknown with a PCP is what is the future value after 3 years. You can make a stab at it but in the end will depend on market forces.

You will get a better deal on leasing less popular cars or ones that are about to be replaced by a new/facelifted model.

If you want the best deal go for the deal and not the make/model. It's value after the deal is irrelevant to you.

Thanks for the tips. Yeah the unknown with PCP is putting me off slightly. I think leasing is a good option because all I am doing is paying for the depreciation. My current car I purchased used for £12k. 18 months and 20k miles later it is worth £8k at best. I would've paid the same for a nicer car on leasing.

Shaka_Zulu

The knack is knowing what a good deal is. Before the crash I did a lot of spreadsheet work on it and in those days a stonking deal was a monthly payment (ie (35+3)/36 to give a true reflection of what it costs) of 1/100 of the RRP.

It will be hard to get that but you can just keep looking and the main thing is think outside the box.

boliston

Shaka_Zulu wrote: »

...
The big unknown with a PCP is what is the future value after 3 years. ....

Surely you normally get a GMFV (guaranteed minimum future value) on PCP

omariqy

boliston wrote: »

Surely you normally get a GMFV (guaranteed minimum future value) on PCP

I think he means whether there will be an equity left in the car to use on your next car.

omariqy

Mazda offerin 0% on PCP so may look at the CX5 with them.

loskie

PCP is a bit of a con IMHO.Dealers trap you into the brand. There is likely to be little or no equity in the car at the end of the term, the value left in it tends to be still the property of the finance co not the customer.
Leasing is good but do not be too specific on the make and model of car, that way it gets costly, the same applies if you add extras (you will no doubt end up paying the entire cost of those). Just look at what good deals are on offer. Jet leasing have some good Astra Elite deals for example.
There are "search" engines on What car for leasing which are good too. If your wife wants something stylish VW Scirrocco is a good price too.

Shaka_Zulu

omariqy wrote: »

Mazda offerin 0% on PCP so may look at the CX5 with them.

0% finance does not necessarily make it a good deal.

ie You might be able to save eg £5k+ on the price by taking out HP or going via broker etc.

motorguy

Shaka_Zulu wrote: »

0% finance does not necessarily make it a good deal.

ie You might be able to save eg £5k+ on the price by taking out HP or going via broker etc.

?

I dont think you can get "extra" discount by not taking out 0% finance on a manufacturer backed finance deal.

kmb500

Just go with whichever is cheapest. You pay a deposit and a 3-year monthly payment on both. Both are restricted by annual mileage.


Leasing you generally get breakdown & tax included. If you're lucky then PCP the dealer may give you some money at the end, or they might not.


Go with whatever is cheapest. I have ordered a Fiesta ST, the dealers I went to were all £300/month on PCP, but I ended up getting it on lease for £200/month. That's a gigantic saving and totally worth it imo. look around, spend a lot of time comparing offers, and you may find a very good deal.