Anyone any experience of car leasing? Or advice on car financing?|
Had a head on collision, all OK but my poor beast is no more. So I get the fun of getting a new car. Leasing came to my attention and I realise I won't actually own the car but seems a good option to have a regular outgoing and reliability. Added fun, looking at a mortgage soon so will it effect offers from banks greatly?
Otherwise any advice or tips on car finance? Most seem to offer PCP (I think) which seems to be the same as leasing but a bit more flexible and the option to buy at the end.
Pretty sure there is another thread on this, where some crazy lady who appeared on Dragon's Den was recommended. Buggered if I can find it though
DaM 14,120 posts
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Even more bonkers than ever...turn speakers off if at work! Or you just like music.
Edited by DaM at 15:57:50 25-02-2013
Ling! That was it:
PCP has much better APR rates than leasing or HP and you have the option of handing it back or buying, whichever suits you best. Car firms prefer it because it could tie you into the brand as any equity left in the car against the remaining balloon payment can be put towards a deposit on a new car when the policy ends. Hopefully you'll start chasing your money like a poker player rather than hand the car back. Currently, BMW has a rate of 4.9% which is one of the lowest out there. There's a lot of potential benefit to PCP over buying outright, just make sure it's right for you m
Mortgage companies will see the debt as part of your monthly outgoings and that may well affect the amount they will be prepared to lend you.
Leasing is a nice thing to do for the reasons you give above and I believe that the rates are quite good nowadays. If you are going to keep the car after 3 years it wont be much different to buying it new up front.
Personally I would say buying a new car doesnt make much sense financially but it you are going to keep the car after 3 years it may help spread the cost.
Edited by Alipan at 16:09:12 25-02-2013
Ta all, looked at Ling and she isn't that competitive. I found other sites with much nicer design that are cheaper, include servicing and tax.
Yeah, I normally buy second hand but not sure I can afford the loan to get a decent car.
Yeah one car company was quoting 4.6% at me but I don't know if this was their rate or APR.
sport 13,044 posts
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I got a new Aygo through Ling. Her team's service is second to none imo. Really, really top notch.
How much is leasing £200 per month? That would also equate to a sizeable loan paid back over a few years so I dont quite understand your logic there.
Also with a loan you wouldnt have to put down an intial deposit as you would on a lease car. And the car would be yours at the end.
To my mind thats a better option but I dont know the exact details of your finances or what you are planning.
A lot depends on what is included, how quickly you want to change cars etc. If you do lots of mileage, have servicing included and want a new car every 2-3 years, I can see the advantages.
mothercruncher 9,542 posts
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Dear God, the Ling site - is that some sort of uber/meta parody of wretched website design?
Not even in the early Wild West days of using the net 20 years ago did I ever seen anything that bad.
Always better to get a bank loan than finance on a car. Most, if not all bank loans, are unsecured. This means if all of a sudden you couldn't afford the payments the only option the bank would have would be to take you to court. Nowadays, if you went that bust there is ways of sorting repayments out amicably by paying less over a longer period. If you have a car on finance, the interest rates will be higher and also it will be secured against the car. If you default on payments you lose the car, and all the money paid so far.
I tend to get second hand cars so get at least a five grand loan over no more than five years and buy a decent second hand car. After five years I get another loan and chop the car in for something else. With all this internet wonderfulness there are plenty of deals out there. My last motor lasted me about seven years. When I got i, it was a one previous owner (sales rep=motorway miles=well serviced/maintained)mkIII Zetec 2.0 Mondeo, five years old with about 80K on the clock.
Edited by guts at 21:25:04 25-02-2013
Ta all for input.
@Alipan it can work out cheaper than buying the car outright. So a friend leased an Alpha Giulietta, OTR at £21k. He's paying 253 a month for 36 months, £700 upfront and £180 fees. Works out to £9988 over 3 years. No tax to worry about, no MOT, covered by warranty.
21k over 5 years from a bank loan would be £488 a month as well as tax, MOT and servicing.
But yes, this is all based on new cars. The alternative is a second hand car, but not so great at choosing them!
Bank loans are one, often good, option but not always the best, it all depends on what you plan to buy. Because its unsecured you might have trouble borrowing 20 odd grand for a new car, whereas you'll have no trouble borrowing from the manufacturer. The best rate My bank offered for a loan was 6.8%, I could probably have gotten a better rate by remortgaging but fuck that. Anyway, the manufacturer gave me 4.9% which is low enough.
I know fuck all about cars and my Mrs just passed her test.(She also knows fuck all)
Anybody got any tips on what to buy, and where from?
A car that goes, is cheap to fuel and insure would be great.
nickthegun 63,915 posts
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altitude2k 5,175 posts
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Just got a new Fiesta on lease for my wife. Feel free to ask me any questions, am quite familiar with the process and options.
We used lingscars as a base price, but would never enter a contract like that online. Need to be able to walk in and shout if I need to. Ford's first price was over £100 PCM more but managed to drop it down to £20 PCM more but with 3 years free servicing.
Dealers also have the benefit of offering 'hybrid' financing. Online lease companies are generally contract hire only - you go over your mileage allowance, you are in for a world of hurt. Ford (and most other dealers) offer something called 'Options' which offer you a guaranteed value at the end of the lease based on your predicted mileage. If you go over your mileage, you can take the hit if you want, or buy the car on standard finance for that value - no penalty.
It also works the other way round too, so if you do less miles or the market is such that your car is worth more than expected, you can swap your car early or use the extra equity to pay the deposit on your next car.
This will be how I will get my next car. Was dead set on a BMW 4-series next year (who offer a similar deal), but I have to say I was so impressed with Ford, their sales, flexibility and the car itself, that I'm considering a Focus ST instead.