Vehicle leasing

That's with no maintenance so I'd have to pay for non warranty stuff

 

I don't get maintenance and thankfully never needed it. Anything major will be under warranty anyway and i only had to put 1 tyre on my Cupra in 3 years cause it got a nail in it. It's all about how bad/good you drive

 

These days, hardly anyone pays cash for a new car. The sticker price is almost irrelevant. What's relevant is how much per month. Lease can often work out cheapest but it's not the only way.

PCP sometimes seems to work out more expensive per month but that's because the amount you are paying down is to reach a residual value (guaranteed minimum future value) that is normally set artificially low, meaning you almost certainly reach the end of the agreement with a car worth more than the GMFV, so if you choose to keep it by paying the balloon payment at the end, the car is worth more than your balloon payment. Its a way of keeping you tied into PCP forever because you are then tempted by the next offer from them, where the residual value you have in the car gets you a good deal next time.

With lease you are essentially long term renting and paying for the expected depreciation plus the lease company's margin. If the monthly figure works for you, it's as good a way as any of getting into a car. But what's always put me off is the lack of flexibility you have if the future doesn't pan out as you hoped. Getting out of them if you need to because circumstances change (eg. Job loss) can be enormously costly. And if you decided in 3 years that actually, you're fed up of shelling out every month and want to keep this car for a longer period, well, you can't.

Salary sacrifice deals on EVs are very popular if your employer offers such a scheme because what you pay is before tax, so you save tax on the payment. In return you have to pay benefit in kind but on EVs its only based on 2% of the cars value so peanuts. But from what I have seen of our scheme, the prices are inflated because the lease co knows you will still be a bit better off because of the tax savings. Its a scheme that almost seems to benefit the lease company more than the employee.

The cost of money has a big part to play in lease and PCP deals. With interest rates now going up, the deals will be worse now than last year. When I last bought, I did all the comparisons and found the cheapest way to step up to the car I wanted was a personal loan. I am one of the old school who still buys cars. I always seem to buy a car with the intention of keeping it for the long term. But that never seems to happen.

One final thought - second hand prices seem to be returning to normal now but anyone who had a lease covering the period up to last year would have got burned compared to buying it because they were paying for depreciation that never happened. But that's a one off situation that is likely to not return.

 

Will definitely look into it again down the line. Bought current car for cash and still only has 48k on the clock 6 years old. So probably just keep running that until it starts causing me pain.

 

Everybodys gor a budget, what evers best for you, things are gerrin harder all the time.

 

if it’s salary sacrifice then penalties for going over are pretty small. Ours is 5p an extra mile so 2000 additional costs 100 quid.

 

Mine includes all servicing, tax, insurance etc. courtesy car if needed etc. it’s 370 a month

 

What level of car does that buy you, JV?

 

In my experience they are all very much the same. Go with the cheapest - Or get your local dealer to price match.

 

I’ve got a VW T-Roc. Just coming to end of 3 years and waiting for delivery of replacement. Went same again as was very happy with it. I’m no ‘petrol head’ though

 

I've got a diesel Tiguan that is coming to the end of 4 years. Its a long waiting list for a hybrid VW so looking at switching to an alternative. Which reminds me, I need to sort it out rather than be on here...

 

Interesting. I've a Polo I bought new five years ago, and been very happy with it. A T-Roc might make some appeal next year for me.

 

I would definitely recommend the T Roc. I’ve been really pleased with it.

 

Has anyone ever been shafted unfairly when returning the car?

 

Leaseloco is a good comparison site. Searches fo best deals