New Car

[Graham C]

as long as you go into lease deal knowing that you are not buying the car - you are basically just renting it over a long term, and that at the end of it you will have nothing to show for your money. think of it a bit like renting vs buying a house.

Not strictly true, a house will generally go upp in value where as a car will have very little value after a few years. 

My next car (well van) will be leased.  I paid £10k for a Vectra four years ago and now it's worth approx £2k if I'm lucky.   It wouldn't have cost me that much more to lease a new car and would save me the hassle of trying to sell a car when I'm after a new one.

[lazaroonie]

as long as you go into lease deal knowing that you are not buying the car - you are basically just renting it over a long term, and that at the end of it you will have nothing to show for your money. think of it a bit like renting vs buying a house.

Not strictly true, a house will generally go upp in value where as a car will have very little value after a few years. 

My next car (well van) will be leased.  I paid £10k for a Vectra four years ago and now it's worth approx £2k if I'm lucky.   It wouldn't have cost me that much more to lease a new car and would save me the hassle of trying to sell a car when I'm after a new one.

of course you are right, but a small point worth noting, is that that the best deals on lease cars is often those cars which have a high residual value, as there is more money left at the back end to play with.

you need to do your numbers very carefully, as they can be wildly different for each car.

[EvilPie]

as long as you go into lease deal knowing that you are not buying the car - you are basically just renting it over a long term, and that at the end of it you will have nothing to show for your money. think of it a bit like renting vs buying a house.

Not strictly true, a house will generally go upp in value where as a car will have very little value after a few years. 

My next car (well van) will be leased.  I paid £10k for a Vectra four years ago and now it's worth approx £2k if I'm lucky.   It wouldn't have cost me that much more to lease a new car and would save me the hassle of trying to sell a car when I'm after a new one.

When you lease a car you are basically taking out a big loan using the car as security.

The payments you make are funding the depreciation on the vehicle and also the interest on the loan.

So for a little example (simplified):

Lease a 20k car for 1 year

Loan amount is 20k. Interest at 10% would be 2k

Car value at end of term estimated at 14k

Total they want off you = 2k + 6k = 8k

Payment per month = 8k/12 = £666 per month.

It is nothing like renting a house. It's a depreciating asset that will eventually be worthless. You are funding the depreciation and paying interest on a loan not paying for the use of the car.

[EvilPie]

as long as you go into lease deal knowing that you are not buying the car - you are basically just renting it over a long term, and that at the end of it you will have nothing to show for your money. think of it a bit like renting vs buying a house.

Not strictly true, a house will generally go upp in value where as a car will have very little value after a few years. 

My next car (well van) will be leased.  I paid £10k for a Vectra four years ago and now it's worth approx £2k if I'm lucky.   It wouldn't have cost me that much more to lease a new car and would save me the hassle of trying to sell a car when I'm after a new one.

of course you are right, but a small point worth noting, is that that the best deals on lease cars is often those cars which have a high residual value, as there is more money left at the back end to play with.

you need to do your numbers very carefully, as they can be wildly different for each car.

It's actually often worth trying to lease a car a year or so old for this reason.

Cars depreciate loads in year 1 less so in years 2 and 3 then loads again once they have to have an MOT.

I got a 2 year lease on a 1 year old car cheaper than it would have been for a 2 year old car of exactly the same spec because the residuals were better.

Bit of a minefield out there Sov. Good luck finding the best deal.

[Graham C]

Where can you lease vehicles that are a year old?  I've only ever seen brand new ones, not that I've looked that much into it.

[boldie]

Silly question but I am sure we got 0% finance on MrsB's vehicle and a X amount back after 4 years...surely that's MUCH better than leasing a vehicle as you have unlimited mileage?

Leasing makes sense for bigger cars but surely not for a car valued at less than 10k new? A 10k only has something like a £170 a month repayment on it and that's you getting unlimited mileage.

[EvilPie]

Silly question but I am sure we got 0% finance on MrsB's vehicle and a X amount back after 4 years...surely that's MUCH better than leasing a vehicle as you have unlimited mileage?

Leasing makes sense for bigger cars but surely not for a car valued at less than 10k new? A 10k only has something like a £170 a month repayment on it and that's you getting unlimited mileage.

The deal you've got with MrsB's car sounds fantastic.

It's much better than leasing because it's at 0%

You are financing the depreciation of the vehicle only and as they have estimated it to be very low it's only costing you about £85 a month.

I'm pretty sure there will be a mileage cap to get you your 5k back though.

Leasing makes just as much sense for smaller cars as big cars if the figures work out right. As I've said you're basically getting a loan to buy the car and then funding the depreciation.

You pay interest on the loan, pay for however much the car loses over the term of the contract and then give it back at the end to pay off the balance of the loan.

It works exactly the same no matter how big or expensive the car.

[outragous76]

I have leased before and lots of very good points been made, esp by Matt

I would say this, in summary

1. Lease deals work best if you arent bothered about a specific car, you can get great deals, esp on new models.
2. Shop around for said deals
3. Make sure you crunch the numbers like a mofo, leave no stone unturned. Most deals are structure 3+23 (for 24 months, with the 3 being the non refundable deposit).
4. Make sure VAT is INCLUDED in all your discussions.
5. Always take the model as it comes, never ADD to the specification, you pay for add ons yourself over 2 years - very -ev
6. Seriously consider whether adding servicing options is financially worthwhile (do the maths  - again)

Finally, writing off a car is a disaster if you lease, so if you think your missus is gonna prang it big, then dont do it

GL - ill keep my eyes open for deals

I really like Niche Automotive but it tends to be better for higher value cars

(and on a personal note - i think you shouold probs buy a car at the level you are looking - 18 months old, so that you get 18 months warranty, but it has done some depreciating)

[EvilPie]

Where can you lease vehicles that are a year old?  I've only ever seen brand new ones, not that I've looked that much into it.

Find a car that's a year old that you want to buy.

Contact the lease company and tell them you want that car.

They will then buy it on your behalf and charge you accordingly.

Not all of them do this obviously but there are quite a lot that do.

[EvilPie]

(and on a personal note - i think you shouold probs buy a car at the level you are looking - 18 months old, so that you get 18 months warranty, but it has done some depreciating)

This btw.

[sovietsong]

Just on my phone atm, but wanted to say thank you for all of your replies. Much appreciated!!

The reason I want to buy a new car/lease is because of my experiences with used cars. I've been unlucky but have spent more on my banged out mondeo that it would have cost to buy a brand new small car.

Want to get away from that sickening feeling when something goes wrong, albeit at a premium!

[sofa----king]

I got a cracking Renault Megane taxed and Mot
1.9 dci dynamique
real clean took it in part ex a few weeks ago I been using it
£2,750
keyless entry ect
panoramic roof all elec air con drives great
if that's any good
rrp around £3,500

[sofa----king]

I got a cracking Renault Megane taxed and Mot
1.9 dci dynamique
real clean took it in part ex a few weeks ago I been using it
£2,750
keyless entry ect
panoramic roof all elec air con drives great
if that's any good
rrp around £3,500

meant to add if your not happy with a car off me after a week I will
give u your money back so long as you don't do loads miles etc

[sovietsong]

well guys i've decided to buy this little bad boy.  Pre-regged with 23miles on the clock!

Click to see full-size image.

Thanks for all your help.

Pretty pleased with £10,500 plus my Mondeo!

[thetank]

Put it all on ManU to win at the weekend.

They can't draw two in a row