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Car Leasing

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I am glad I revived this old thread, it is proving very interesting and providing a sensible discussion of the topic.  (It just shows how very useful MF can be to the community when not abused by members posting rubbish).  Thanks to those who responded.

My sudden interest in leasing my next car was triggered by a conversation with a locally based car trader who said anybody who buys a car, be it new or second hand, in today's market is wasting their money.  Technology and regulations are now changing so fast that it is impossible for the layman to predict values or trends.  'Let the trade take the risk', he said.  He has no axe to grind as he is now retired, but was very successful in his day.

Where we differed is that I would like an electric car.  His advice was don't touch them.  He thinks petrol is always the way to go.  I still plan to stick to my fairly green credentials if I can find a suitable deal.  I have sent off a few email enquiries and I will let you know how it goes.

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3 minutes ago, war baby said:

I am glad I revived this old thread, it is proving very interesting and providing a sensible discussion of the topic.  (It just shows how very useful MF can be to the community when not abused by members posting rubbish).  Thanks to those who responded.

My sudden interest in leasing my next car was triggered by a conversation with a locally based car trader who said anybody who buys a car, be it new or second hand, in today's market is wasting their money.  Technology and regulations are now changing so fast that it is impossible for the layman to predict values or trends.  'Let the trade take the risk', he said.  He has no axe to grind as he is now retired, but was very successful in his day.

Where we differed is that I would like an electric car.  His advice was don't touch them.  He thinks petrol is always the way to go.  I still plan to stick to my fairly green credentials if I can find a suitable deal.  I have sent off a few email enquiries and I will let you know how it goes.

i'd still say buying a cheap car and running it into the ground probably costs less than leasing,  maybe if you want to be driving a car that's less than 2 years old leasing might be a better option.

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I spent my whole working life in the motor trade, I was lucky enough to have the use of a new car for most of that time, some very much top end stuff. I don't think I could bring myself to buy a new car, I'd consider leasing though.

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7 hours ago, Mole62 said:

If the car devalues for the customer, it will do the same for the finance provider so this will be built in to the monthly cost. A 2012 car is now seven years old, and I don't see them being given away very often. These schemes are not for seven years though.

It's maybe not worth tying your capital up in a vehicle if you can safely earn a good rate of return on it. I'm not aware of many ways that's possible these days - "safe" investments seem to return less than inflation. It all comes down to the numbers on any individual deal, but I believe the capital being tied up will cost the finance provider more than any individual can earn from it (without adding their labour).

Lots of things are going up in value rather than down. I don’t agree on depreciation either as finance companies have various ways of writing back losses against tax not open to the average person. Plus you have to be able to sell your car to someone when you need to trade. Any dealer will give you rock bottom, and with any private sale you run the risk of being stiffed by someone. That’s why the likes of webuyanycar.com are successful as you’re going to get your money as a faster payment from a trusted trading business not some iffy bloke who turns up on your doorstep with a £10K rubber cheque for your car. Normally it’s easier to just pay monthly and have the depreciation factored in and walk away. I honestly don’t believe people still actually buy new cars with their own money. It seems mad given how fast the technology is changing. 

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3 hours ago, WTF said:

i'd still say buying a cheap car and running it into the ground probably costs less than leasing,  maybe if you want to be driving a car that's less than 2 years old leasing might be a better option.

Well, this has been my chosen option for very many years, but as I am probably more or less in my last car buying phase (I'm an old banger myself now!) I figured I would splash out on a decent set of wheels for one last time.  But what a minefield it is.  Probably I will not understand all those flappy paddles and TV screens telling me where to turn next.

I hear the buses are quite good these days.  I can do that for free.

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18 hours ago, MrPB said:

Lots of things are going up in value rather than down. I don’t agree on depreciation either as finance companies have various ways of writing back losses against tax not open to the average person. Plus you have to be able to sell your car to someone when you need to trade. Any dealer will give you rock bottom, and with any private sale you run the risk of being stiffed by someone. That’s why the likes of webuyanycar.com are successful as you’re going to get your money as a faster payment from a trusted trading business not some iffy bloke who turns up on your doorstep with a £10K rubber cheque for your car. Normally it’s easier to just pay monthly and have the depreciation factored in and walk away. I honestly don’t believe people still actually buy new cars with their own money. It seems mad given how fast the technology is changing. 

But with the arrival of "Jacksons" it is now much cheaper to buy / own a car, than it ever was on the Isle of Man !!

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18 hours ago, MrPB said:

Lots of things are going up in value rather than down. I don’t agree on depreciation either as finance companies have various ways of writing back losses against tax not open to the average person. Plus you have to be able to sell your car to someone when you need to trade. Any dealer will give you rock bottom, and with any private sale you run the risk of being stiffed by someone. That’s why the likes of webuyanycar.com are successful as you’re going to get your money as a faster payment from a trusted trading business not some iffy bloke who turns up on your doorstep with a £10K rubber cheque for your car. Normally it’s easier to just pay monthly and have the depreciation factored in and walk away. I honestly don’t believe people still actually buy new cars with their own money. It seems mad given how fast the technology is changing. 

Yes, but if we're just looking at leasing vs buying without using your own savings then it's [monthly payments + service costs - resale value]) against [monthly payments (finance + service costs) with final option to buy (based on resale value)] - it really just comes down to the specific numbers for any particular deal. If you have a car from a dealer and trade it back to them a couple of years later they want the same margin, whether it's a lease deal, finance, purchase or whatever. There's less risk and less freedom with leasing but the underlying maths is pretty much the same.

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Posted (edited)
On 6/8/2019 at 7:41 PM, Max Power said:

I spent my whole working life in the motor trade, I was lucky enough to have the use of a new car for most of that time, some very much top end stuff. I don't think I could bring myself to buy a new car, I'd consider leasing though.

Now that's interesting. I'd always considered leasing to be for the ill informed. 

Is it just a new car you wouldn't buy? What arrangement do you have with your current wheels?

ETA. The only circumstances in which I would buy a new car would be if I could afford it outright and if I intended to keep it for 10 years plus. I  wouldn't consider leasing atm. 

Edited by Chris C

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2 minutes ago, Chris C said:

Now that's interesting. I'd always considered leasing to be for the ill informed. 

Is it just a new car you wouldn't buy? What arrangement do you have with your current wheels?

I'd consider it after doing my sums, the amount of depreciation would make the decision and I'd be looking at the overall costs over six years, which is a two car period. What has changed my mind is the move to electrification and the potential for big drops in value. I'd probably look at hybrid rather than full electric. 

My current car is a used diesel, an outright purchase of a new car just seems too extravagant with the depreciation involved.   

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19 minutes ago, Chris C said:

Now that's interesting. I'd always considered leasing to be for the ill informed. 

Is it just a new car you wouldn't buy? What arrangement do you have with your current wheels?

ETA. The only circumstances in which I would buy a new car would be if I could afford it outright and if I intended to keep it for 10 years plus. I  wouldn't consider leasing atm. 

do modern cars last 10 years without spending a lot on them?   they have lots of electrics to go wrong.

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well mine is a 2003 and the biggest non service item was a new alternator £200 and a couple of co2 sensors and a coil pack.............electrics and electronics as you say.

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Wot! No plugs and points?

It's a conspiracy to stop us 'Old Uns' repairing our own cars!!!

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best thing I ever bought is a code reader, great piece of kit, it even works with an adaptor on my vw lt35...............1998!

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Posted (edited)
33 minutes ago, doc.fixit said:

best thing I ever bought is a code reader, great piece of kit, it even works with an adaptor on my vw lt35...............1998!

ELM 327 under a fiver never have to have your pants pulled down by a garage again!

Edited by finlo
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29 minutes ago, doc.fixit said:

well mine is a 2003 and the biggest non service item was a new alternator £200 and a couple of co2 sensors and a coil pack.............electrics and electronics as you say.

Why should that be? Surely the mechanical (moving) parts should be wearing out quicker? Granted the alternator has moving parts,  the CO2 sensor are they in the exhaust? So perhaps heat plays a part,  and I suppose the coil is HT so we'll let that off, but generally electrics should be more reliable surely?

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