leasing vs finance

stevo as b4 · World Chat Champion Joined: 17 Jul 2003 Karma :

I think leasing cars has its place, as does the modern family man or business person wanting to drive new and premium cars for business and aspirational reasons.

But leasing is not for people that are really into cars, fettling, modifying or track daying etc. Those sorts of people are in the grand scheme of vehicle owners pretty insignificant these days, but for those people it's built not bought all the way.

I'd be happy leasing a new city car, as I wouldn't be thinking about coilovers and roll cages etc. But there's no way on earth I'd lease a new hot hatchback, as buying a used one that's out of warranty and spending money on upgrades would be better option for me.

iooi · Super Spammer Joined: 14 Jan 2007 Karma :

dodsi · Dirty Carny Joined: 06 Aug 2004 Karma :

bikertomm · World Chat Champion Joined: 03 Jul 2010 Karma :

dodsi · Dirty Carny Joined: 06 Aug 2004 Karma :

Excellent, some sensible and quantified numbers, your E46 330cid looked like a nice car too! 45/50mpg - that's excellent but what sort of conditions? As that's the sort of MPG we got from our 2.2l 4 pot Civic.

Down here on the south coast there is a lot of stop start shenanigans that kill your MPG. I get around very low 20s in my 6 pot 2.5l petrol e46 but then again it doesn't do many miles really. And therefore is a very cheap car to run for me. I could save money with another 1.8 petrol Avensis but I do love the silky smooth auto BMW.

M.C · Super Spammer Joined: 29 Sep 2015 Karma :

iooi · Super Spammer Joined: 14 Jan 2007 Karma :

dodsi · Dirty Carny Joined: 06 Aug 2004 Karma :

Robby · Dirty Old Man Joined: 16 May 2002 Karma :

I did similar maths to Dodsi, which is why I chose to lease.

After many years of bangers and spending a fortune on parts I wanted something a lot newer, better on fuel, and safer. That means spending around £7k on something Focus-sized.

At £7k, those cars still have a lot of depreciating to do. At 3-6 years old, they're also at the age where out-of-warranty failures can happen and be expensive. I'd rather have another banger.

So leasing, brand new car, I know what it's going to cost me for the next two years. The insurance is cheaper than my old Mondeo (I have no idea how, this car is worth 40x as much).

And yes, at the end of the two years I'm left with no car. At that point I can decide to do another lease deal, or buy a car. The same position as if I had kept the mondeo and kept buying lots of fuel and lots of parts, except I didn't know when the mondeo was going to expire.

One of the problems I came across when I was looking for a car to buy was forgetting that it's 2016. I was seeing cars on 2010 plates for ~3k and thinking that's cheap for such a new car - and then realising that the car is 7 years old.

There are cheaper ways to have a car, but I don't need a dirt cheap car any more. I rather like having a modern car, it does all sorts of clever things.

dodsi · Dirty Carny Joined: 06 Aug 2004 Karma :

Robby · Dirty Old Man Joined: 16 May 2002 Karma :

bikertomm · World Chat Champion Joined: 03 Jul 2010 Karma :

Bozzy · Traffic Copper Joined: 20 Dec 2015 Karma :

M.C · Super Spammer Joined: 29 Sep 2015 Karma :

Bozzy · Traffic Copper Joined: 20 Dec 2015 Karma :

dodsi · Dirty Carny Joined: 06 Aug 2004 Karma :

You are welcome to bring my choice of motor into question but it is just a slightly larger Passat in a nicer looking frock (purely based on opinion). Much more premium than the Octavia and lower range skoda range - remember this is their top car. Very quiet inside and extremely
Comfortable and ridiculously spacious car. As a 6ft 5 driver the rear seat behind me is written off as a viable seating option for anybody other than a double leg amputee - In the superb a similar sized person could sit behind me as a driver. The car is vast and can hit a genuine MPG over 65mpg whilst it won't set the world on fire it's quick enough. I'm very happy - it's a properly nice car. If you have any direct experience with the new superbs I am happy to be corrected and admit that it is an old eastern block beater.

Bozzy · Traffic Copper Joined: 20 Dec 2015 Karma :

I agree it's a nice car.

Obviously M.C isn't a fan, which is fine. It'd be a boring world if we all liked the same thing.

Although I am interested to hear what choice of car he made which is obviously superior to your (as he put it) meh eurobox.
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dodsi · Dirty Carny Joined: 06 Aug 2004 Karma :

I think MC is just disagreeing for the fun of it or just wanting a rise - same as Iooi - not that it particularly matters to me if people want to mis quote me or only read a quarter or half of what I have actually put... that's fine - sometimes it's fun to play chess with a pidgeon.

iooi · Super Spammer Joined: 14 Jan 2007 Karma :

M.C · Super Spammer Joined: 29 Sep 2015 Karma :

I'm disagreeing cos your own maths and everybody else's proves your lease's not cheaper, as you're using a heavily depreciating Civic as an example. I don't have anything against meh euroboxes, I do paying 7k to rent one. A friend bought an S2000 for 6k, I don't understand paying a premium for an average car.

Anyway I'm sure this topic has been incredibly helpful for the OP, 3 pages of you trying to defend your choice Rolling Eyes

dodsi · Dirty Carny Joined: 06 Aug 2004 Karma :

It's still a situation of 'why won't it read'

https://ecstaticreality.files.wordpress.com/2013/11/why-wont-it-read2.png

Let's try this again, I'm not defending my decision - I am simply stating that's it's not worth writing off a lease as a viable way of running a car - contarary to the status quo here.

I never said leasing was the cheapest way of running /any/ car but it stands up well in terms of overall running and ownership of new and reasonably new cars - approved used type.

I have also stated - very early on that for all the reasons leasing is a bad idea my second car is a 'banger' which I don't expect to cost me anywhere near the under 7k total costs disregarding fuel and insurance. Believe me - I see both sides of the argument... evidence being what I own and my examples given.

Not all leases cost as much as mine, some cost more others much less and even company to company on the same vehicle the costs can differ massively. Point is - all vehicles have a cost to run over time with usage. Banger, used, approved used, nearly new and new. It's worth checking if a lease is a viable option as they are not necasarrily wasteful because you don't 'own' anything - it's just a cost over time analysis. It may add up, it may not.

I have friends that have spent thousands in a year keeping a banger going and every day running costs - they could have had a cheap lease for less money and a fixed cost and less stress along the way.

Examples here on used cars show that in those circumstances are less overall spend than my lease - I am not bringing into the fact that 'my' (read VW financial services') car is way nicer and therefore 'better' - because that is totally subjective. And I am not bringing into the mix if you get a series of failures that they could be costly. If bikertomm's E46 330cd had something big go wrong in that time it would be incredibly costly and bring those costs much nearer mine. In my position with the lease I would take it to a man what would fix it under warranty or repair it under the terms of the maintenance part of my lease - ergo no additional cost to me.

It's simple - one last time -if (cost over time for lease) =< (total running costs for other car options) then 'lease worth considering' else 'lease not worth considering'

Finally, getting back to OPs post - I predict that a lease /could/ be a cheaper way of financing the replacement car and to do the maths and compare the deals and work out the pros and cons.

I also realise it got like this too many posts ago... and normally I don't ever post this much on a subject but for whatever reason I have time on my hands and a point to prove. (Mainly wrongly)

https://gobeforegrace.files.wordpress.com/2015/10/6e28f-someone-on-the-internet-is-wrong.jpg

Bozzy · Traffic Copper Joined: 20 Dec 2015 Karma :

Example:

My other half is currently fancying a brand new MINI Cooper 5dr with a Chilli Pack. It's not my cup of tea, but horses for courses and all that. She wants a new car because warranty, no MOT to worry about etc. She does 10,000 miles a year and her car is her livelihood.

This car has a list price of £19,575.00. Looking on Drive the deal, it appears a £900 discount is available on this car if I take out MINI's 5.9% PCP. So the discount would be clawed back with the interest, so I will ignore the discount and focus on buying it cash.

So I'll go in, hand them a cheque for £19,575 and Mrs Bozzy is a happy woman. Much suckie suckie will come my way, she'll make me steak for a few weeks and the world's a better place.

In 3 years time the warranty is up and she decides she wants to sell it. Only I have to sell it because she was offered £9,730 in part exchange and nearly 10 grand in depreciation is a big hit. I tell her, you should have bought an old snotter. Her response is I do 10,000 miles a year and I don't want an old crabby car. Fair enough, she works hard and we can afford it. So I sell the car privately and draw £10,890 for it. I had to deal with a few Nigerian Princes along with a fair few anoraks kicking tyres, but still, happy days!

It has cost us £8,685 in depreciation and now she wants another new car, so I have no car to show for it! Still, I like steak and suckie suckie.

Rewind 3 years..I could have got the same car on lease, £1458 + £420 fees as an initial payment, followed by 35 payments of £162. Based 10,000 miles a year. Total price £7,548 over 3 years. I didn't need to spend much of my savings and I didn't need to sell it privately. Best of all, I still got steak and suckie suckie.

Lease is not for everyone. If you want cheap motoring, buy a £100 shed with 12 months MOT.

If you want a new car, consider lease as much as any other payment option. It's not always cheaper, but sometimes it is!

I've just saved £1,137 over 3 years by using lease instead of cash.

(***All figures inclusive of VAT. Drive the deal was checked for discount on the New MINI. Projected prices of private sale and trade in were obtained using "Auto Trader's Value My Car" using an identical 3 year old car to the one mentioned with 30k projected mileage over 3 years)
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2004 SV650S >>> 2009 Street Triple R

dodsi · Dirty Carny Joined: 06 Aug 2004 Karma :

Great example - fairly put.

Polarbear · Super Spammer Joined: 24 Feb 2007 Karma :

Jesus, this has turned into an epic. Laughing

Now I'm going to throw a cat into the pigeon loft and ask.....

What's the difference between PCP and leasing? Is one better than the other?

I have only ever bought vehicles with cash or a bank loan so a lot of this is new to me.
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