Gransnet forums


Car Leasing

(22 Posts)
Lilypops Wed 17-Apr-19 09:18:03

Have any of you leased a car instead of buying or getting a loan for it? I am thinking of leasing a new car for 4 years then give it back to the dealership and drive another one away with nothing to pay for the next 4years, the monthly payment is low and affordable , What do other Grans think please, I just can't decide , I have always owned a car outright , this arrangement is new to me,

kittylester Wed 17-Apr-19 09:52:18

I presume you are talking about a pcp?

We have done that for years- probably the last 4 or 5 cars. We like it because we get a new car every 3/4 years. There is always the option to buy out right at the end which we had done with dh's previous car which is not our main car.

Sara65 Wed 17-Apr-19 10:21:46

I’ve done this for the first time and I think it’s a really good idea, everything is covered for four years, including tyres! and as you say, brand new car in four years! A lot of people will say you’re throwing money away, but if it suits you, and your circumstances, I’d definitely recommend it

Nonnie Wed 17-Apr-19 10:29:41

What are the conditions? What if you get the odd scratch or little bump?

I heard something recently about the ticking time bomb for those who underwrite these contracts, that too many people are doing it and the residual value will not be achievable. Of course that doesn't apply to the person taking on the lease so not a worry.

Sara65 Wed 17-Apr-19 10:47:58

Well you still take out insurance in the normal way, so little bumps and bashes are dealt with as before, I don’t think the odd scratch will matter(I hope not anyway!!!!)

kittylester Wed 17-Apr-19 10:53:24

Someone drove into my car in a supermarket car park recently and the scrape is taken care of on normal car insurance.

You can do this either with services (and tyres) included and also without them.

We do it with a PCP and you have to say how many miles you will do in a year. If you go over, the extra miles are quire expensive but if you include a generous amount of miles then the cost is slightly higher per month.

kittylester Wed 17-Apr-19 10:57:17

Obviously, you are borrowing money to lease the car but lots of manufacturers are currently doing 0% finance as new cars aren't selling.

I think that there are other types of car leasing but I only know about PCPs.

Willow500 Wed 17-Apr-19 11:02:10

We've had PCP's on our cars for some years now. It's especially good in the case of my husband's this time round as it's diesel and the resale value will inevitably drop - he'll just take it back when the time comes.

You can take out insurance to cover the paintwork and wheels which I have done but it's not a requirement - they came out and attended to a scratch last year with no charge.

With my last car once I was over half way through the payments I was allowed to just give it back which enabled me to change the car earlier.

If you can afford the repayments for the term it is a good way of getting a new car - just think in the long term though what you will do at the end when the balloon payment is due.

kittylester Wed 17-Apr-19 11:24:59

Ours have always been worth more than the balloon so the extra has been used as, or part of, the initial payment for the next one. Unless we have paid the last payment and kept them.

sunnydayindorset Wed 17-Apr-19 11:30:04

Son is an accountant. The only people in his firm who lease cars are the Partners who can set them against tax. All rest don't. He paid up front for his car- second hand one as well.

kittylester Wed 17-Apr-19 12:37:37

Maybe they are leading flashier cars that the rest of us.

GrannyGravy13 Wed 17-Apr-19 12:44:27

Unless it is a "pool car" if your company is leasing a car for you I think it will be classed as an "in work benefit" and you will have to be taxed on it!

J52 Wed 17-Apr-19 13:40:53

I’ve just been looking into this, although we have always bought outright. I’m sure it works well in the majority of situations.
I’m not going to go down that route because I want a particular car that’s just come onto the market and want some specific additions.
The PCP offers were only in a couple of colours with the standard specifications. Being a new design the monthly cost we’re quite high, making it not such a deal.

Lilypops Wed 17-Apr-19 14:45:39

GG I am retired so the taxing won't apply to me,, Willow , the dealer says no balloon payment at the end , I just give it back and drive a new one away, Sounds to good to be true doesn't it, which is why I am so wary, Thankyou for all your input , much appreciated, am still undecided, my gut instinct is to not go for it and keep my 3year old car , but then a new one would be nice......

Nonnie Wed 17-Apr-19 15:22:51

Lily why not ask the dealer for a copy of the agreement to take home and read? There is too much pressure in the showroom.

kittylester Wed 17-Apr-19 16:57:08

That sounds like a different sort of lease. DS2 did that with his last car and intends to keep the same car at the end of the lease at a reduced rate.

Davidhs Wed 17-Apr-19 17:24:43

Just remember unless you pay any “balloon” the car never belongs to you, how much you pay depends on each finance company and the rate can vary widely as can the discount at purchase.
If a new car every 3 years is important to you go for it, although keeping it for 5 or 6 yrs is going to cost a great deal less per year.

NanaMacGeek Wed 17-Apr-19 17:39:40

Here is an interesting article from What Car
It's worth reading to the end because it includes leasing as well.

Jessity Wed 17-Apr-19 18:46:48

The OP talks about leasing, not PCP and it is different, we've done both.

With PCP, you pay an amount each month and at the end of the term, you have the option of paying the "balloon" payment and owning the car.

With a lease, you cannot buy the car, at the end of the term, you hand it back.

We're almost at the end of a two-year lease, take delivery of a new car next month and hand the old one back.

You can include maintenance (which covers servicing) in your monthly payment or exclude maintenance and pay for servicing when it's due.

Leasing a car is rather like hiring one when you're on holiday, you pay what's due and then hand it back.

Elizabeth1 Wed 17-Apr-19 19:10:36

We’ve gone for a leased car. Our own car has cost us in the region of £1000 in repairs over the last few months and it’ll have to go. I’m really looking forward to our new car which is really very affordable.

Lilypops Wed 17-Apr-19 21:57:48

Nana mgeek, Thankyou for the very interesting link on car leasing/PCP, Some of it sounds good some not , I will study it and show it to OH, it seems clearer to me, I will have to make a decision by the weekend as the car will go on the market ,

oldgaijin Fri 19-Apr-19 08:55:18

I've had lease cars for years with great success. Insurance, breakdown cover, servicing etc are all included in the cost. There is an allowance for reasonable wear and tear when you hand the car back after three years and get a new one.