Car leasing options, cancelling early

Cobra496

Hi All,

TL:DR: looking to change job sometime in the new year. Current car has issues and I'd like my next car to be a lease car, however it's possible my next job means I'd have to get rid of the car as I want to live in one of the big cities. Does anyone know if/what the best way for me to lease a car is that would allow me to cancel the contract should there be a change in my personal circumstances?

In a bit of a unique situation at the moment. My current car has around 10 months left on its MOT, but there are problems with the engine (timing issue so prob need to replace the timing kit, needs a new cat converter) meaning to get it fixed will probably cost around £700.

Currently I commute ~15 miles either way 5 days a week. I'm looking to change jobs soon(want to properly start committing a job search in the new year, but this can take a few months) and want to move to a big city where owning a car may well be impractical and too expensive, i.e. London/Manchester/Bristol, depending on my location of residence and work.

The job may well require me to own a car, or it might be a commute on public transport to the center - at the moment I just don't know as I want to see what the options are. Likewise where I choose to live might mean parking is insanely expensive and i'd need to drop my car.

For my next car, I'd like to lease as buying another car is out of question - I don't have the money for even a 4k second hand car.

Does any one know if there are any finance options out there to get a lease deal which I could cancel should my circumstance change? I've googled this question and it generally seems to be a no-no from the links I've seen. I've seen websites mentioning that 50% (including balloon payment for a PCP deal) of the contract would need to be payed off. But maybe individual dealers have more flexibility when asked?

An option is to keep my current car, and I am considering this, but it feels like it could keel over any minute.

Thanks

AdrianC

No lease is cheap and easy to cancel. You contract for a certain period, and the depreciation costs of the car are averaged out over that period. Depreciation is steepest at the start, so a short-term lease would be far more expensive per month.

50% including balloon is for a voluntary termination, a legal get-out. You don't need to use that to end a finance deal - you can ask for a settlement figure at any time.

In your position, I'd be looking at taking a loan and buying a cheaper used car - no need to even spend as much as £4k. Then you can sell it whenever you know your requirements, and settle the loan if it hasn't already been paid off.

Cobra496

Hi, thanks for your response.

It seems like leasing for a potentially short term period is out of question then, I suspected this would be the case. I'll probably keep my current car, pray that it doesn't break before if/when i get a new job (can take a while). If not loan sounds the best way forward (although not ideal).

If anyone knows of any specific ways that leasing can be cheap for short periods let me know!

If I had started a new job which required a car, I'd definitely commit to a lease.

Regards

Ectophile

I think leasing for the short term is generally known as "car rental". You can do it for as little as a day if you want to. But renting a car for months could get expensive.


Personally, I have an issue with the whole idea of a lease that runs for three years or so. Suppose you start a new job and need a car. So you take out a 3 year lease on one.


Four months later, during your probationary period, your new employer decides they don't like you and hands you your notice. You now have over 2.5 years left on the lease, and no job. Even if you find a new job, that may not be the car you need any more.


Leases are totally inflexible. Which is why the finance companies are so keen on pushing them.

k6chris

Ectophile wrote: »

Personally, I have an issue with the whole idea of a lease that runs for three years or so. Suppose you start a new job and need a car. So you take out a 3 year lease on one.


Four months later, during your probationary period, your new employer decides they don't like you and hands you your notice. You now have over 2.5 years left on the lease, and no job. Even if you find a new job, that may not be the car you need any more.


Leases are totally inflexible. Which is why the finance companies are so keen on pushing them.

Leases and PCP are not bad things as such, the issue seems to be that they tend to apply for new cars, rather than used ones. The message these deals give out is "why buy a used car for £7,000 when you can have three years of a new car for only £200 a month?" Broadly speaking the same amount of money, but the depreciation curve of a new car means that from day one you will be in giant negataive equity if your circumstances change (and of course you have nothing at the end of 3 years). With the used car, you have more flexibility and the 'day one' hit will be far less penal.


Leasing and PCP are a real alternative to buying a new car outright, but they do not give you a 'new car for used car money'. Many, many posts on this forum unfortunately attest to this fact.


OP, good luck sorting out your situation, hope it works out.

AdrianC

Ectophile wrote: »

I think leasing for the short term is generally known as "car rental". You can do it for as little as a day if you want to. But renting a car for months could get expensive.

Personally, I have an issue with the whole idea of a lease that runs for three years or so. Suppose you start a new job and need a car. So you take out a 3 year lease on one.

Four months later, during your probationary period, your new employer decides they don't like you and hands you your notice. You now have over 2.5 years left on the lease, and no job. Even if you find a new job, that may not be the car you need any more.

Leases are totally inflexible. Which is why the finance companies are so keen on pushing them.

Go out and buy a brand spankin' new car.
Change your mind after four months and flog it - you're going to take a financial bath on that, too.

You can pay out of the finance deal via the settlement figure, too, you aren't totally locked in. Sure, it's expensive. But that's simply because depreciation is steep initially.

Jumblebumble

Ectophile wrote: »

I think leasing for the short term is generally known as "car rental". You can do it for as little as a day if you want to. But renting a car for months could get expensive.


Personally, I have an issue with the whole idea of a lease that runs for three years or so. Suppose you start a new job and need a car. So you take out a 3 year lease on one.


Four months later, during your probationary period, your new employer decides they don't like you and hands you your notice. You now have over 2.5 years left on the lease, and no job. Even if you find a new job, that may not be the car you need any more.


Leases are totally inflexible. Which is why the finance companies are so keen on pushing them.

There used to be ( 3 years ago) some leasing deals at stupid money
There is a long thread on Pistonheads about this
Nowadays I agree that they are inflexible
A 2 year lease taken out 3 years ago has suited me really well as with the right company you can have an indefinite informal extention which will never be called in.
This means I can give the car back with a months notice
Keeping for an extra year meant £130 a month instead of £1500 down and £180 a month
Manufacturers warranty after 3 years is £230 per year
I cannot get the same spec now as the engine size has been reduced
I also have the option to buy the car if I want