New driver seeking finance/lease help

AssaTM · 24 Feb 2014 at 12:38

Hello all, i'm learning to drive and was always thinking of getting a used car and go down the usual route etc, but then it was brought to my attention about the system a lot of people use nowadays where you pay a deposit, pay a small monthly fee and then after 3/4 years you either pay the rest of the car off, or go onto a new car.

Now i'm not looking for people to say do/dont do that etc as I do like the sound of it, I can afford it and a new car gives me the peace of mind that it wont break down after 5 minutes or if it does, it will be taken care of, but my question is, do the dealers (in particular Ford) deal with drivers with little to no experience, would it perhaps mean a higher deposit or some other compromise like that? any help/advice from people that would know would be greatly appreciated, thank you

rodenal · 24 Feb 2014 at 12:40

Excluding the "good idea/bad idea stuff" then no, nobody will care whether you've been driving 1 year or 100, only your credit rating will matter

Sui · 24 Feb 2014 at 12:41

Only company that will care is the insurance company

AssaTM · 24 Feb 2014 at 12:44

Ok thats fine thank you

, insurance would be really well priced on it which is whats enabled me to consider this option

Steeps · 24 Feb 2014 at 12:51

Buy something cheap to get to grips with being on the road by yourself, if you are going down the finance route the car will have to be in good condition when returning it at the end of the deal or you will have further charges (car park scrapes, minor bumps etc will all have to be fixed instead of quick fixing them). Also if your car is written off without suitable GAP cover (there are better alternatives than dealer GAP) you will still have to clear the balance of the finance even if you no longer have the car.

Don't be fooled by new car = reliable, my Toyota has been back to the dealers 4 times in 6 months for issues from new, my first car was 4 years old and didn't need any work in 5 years of ownership.

wingman · 24 Feb 2014 at 12:59

OP, buy a £500.00 runabout. After a year or so of driving, buy a new car if you wish.

Steeps said:
Don't be fooled by new car = reliable, my Toyota has been back to the dealers 4 times in 6 months for issues from new, my first car was 4 years old and didn't need any work in 5 years of ownership.

Whilst I agree with the sentiment that new doesn't always equal reliable, the point is that buying new means any repairs/issues will be dealt with by the dealer for free.

AssaTM · 24 Feb 2014 at 13:22

Yeh dont worry above all else the main deciding factor is just how comfortable I feel, if I feel I do need the extra experience I will buy a run about, but not all new drivers are clumsy at the end of the day, and yeh the main factors arent things such as oh I have a new car yay me or anything like that, it's the fact that any repairs etc will be dealt with by the dealer, things like that. The cost isnt really that much different if you buy a used car that unfortunately needs repairs etc down the line

rodenal · 24 Feb 2014 at 13:26

In all but catastrophic examples that simply isn't true.

However its completely your choice and tbh there's nothing wrong with wanting a new car.

I guess the only thing I would say is that I binned my first car about a month in, wouldn't fancy doing that to a new car ( or any but you get the message)

Yaayuh! · 24 Feb 2014 at 13:29

Take into account you're inexperienced and you're more likely to have an accident because of this and insurance will cost a lot.
Would you rather crash a dirt cheap car you do own or an expensive new car you don't own?

sovietspybob · 24 Feb 2014 at 13:32

AssaTM said:
The cost isnt really that much different if you buy a used car that unfortunately needs repairs etc down the line

I'm going to have to pick you up on that, buying say a 1.6 ford focus for 5k even if something pretty catastrophic failed it'd still not cost *That* much to fix.

After 3 years on a PCP deal you'd have paid your deposit + 3 years of monthly payments and have nothing to show for it, where as the focus might be worth 2.5k and have only cost a few hundred in repairs/consumables.

A car like this for example, http://www.autotrader.co.uk/classified/advert/201402171857603 Even if the absolute worst happened i.e. the engine fell out it'd only cost around £600 for a new engine! (minus fitting of course)

Haggisman · 24 Feb 2014 at 13:53

AssaTM said:
The cost isnt really that much different if you buy a used car that unfortunately needs repairs etc down the line

Unless you're buying something stupidly cheap new (i.e. a Dacia or a cheap supermini), then this really isn't true.

If you want a new car, then by all means get a new car (if you can afford it), but be fully aware that it will cost you substantially more over it's life than exactly the same car a couple of years old.

Tinders · 24 Feb 2014 at 14:28

I think diesel cars have given second hand cars a bad rep, because diseasals do throw up large bills when they go wrong, the motoring public assume all used cars are the same.

Buying new is not a cheap way to get into motoring, you will still need to pay for dealer servicing, and have mileage restriction on PCP type deals, and consumables arent covered on warranties either.

Haggisman · 24 Feb 2014 at 15:12

Tinders said:
I think diesel cars have given second hand cars a bad rep, because diseasals do throw up large bills when they go wrong, the motoring public assume all used cars are the same.

Buying new is not a cheap way to get into motoring, you will still need to pay for dealer servicing, and have mileage restriction on PCP type deals, and consumables arent covered on warranties either.

Not to mention the 50%* drop in value the moment you drive it out of the dealership

*Ok, maybe a bit of an exaggeration, but still...

ci_newman · 24 Feb 2014 at 16:31

OP, what is your budget and what kind of cars are you looking at?

aaron · 25 Feb 2014 at 18:54

Ill be honest, I bought a £900 52 reg Ford Ka when I first started drving, cost me way more than the car was worth in repairs over just one and a bit years.

However I have just got myself a brand new Fiat 500 Sport on finance for £148 a month, so while it will cost more in the long run it is already proving a lot better for me as im not forking out huge sums in repairs and dont have the worry that everytime I get in my car I am going to find something else to fix.

The main thing that shoved me up the backside to go down the finance route was my MOT was due in March and would have easily cost me a good £500 (it did last year hence basing my figure at that). So personally I say go for finance, helps if you haggle as well as I got free GAP insurance chucked in.

Tinders · 25 Feb 2014 at 19:59

aaron said:
Ill be honest, I bought a £900 52 reg Ford Ka when I first started drving, cost me way more than the car was worth in repairs over just one and a bit years.

However I have just got myself a brand new Fiat 500 Sport on finance for £148 a month, so while it will cost more in the long run it is already proving a lot better for me as im not forking out huge sums in repairs and dont have the worry that everytime I get in my car I am going to find something else to fix.

The main thing that shoved me up the backside to go down the finance route was my MOT was due in March and would have easily cost me a good £500 (it did last year hence basing my figure at that). So personally I say go for finance, helps if you haggle as well as I got free GAP insurance chucked in.

How??? Theres nothing remotely expensive or labour intensive on a KA to fix, they Rot, but thats something you can spot prior to buying.

Haggisman · 25 Feb 2014 at 20:05

aaron said:
Ill be honest, I bought a £900 52 reg Ford Ka when I first started drving, cost me way more than the car was worth in repairs over just one and a bit years.

However I have just got myself a brand new Fiat 500 Sport on finance for £148 a month, so while it will cost more in the long run it is already proving a lot better for me as im not forking out huge sums in repairs and dont have the worry that everytime I get in my car I am going to find something else to fix.

The main thing that shoved me up the backside to go down the finance route was my MOT was due in March and would have easily cost me a good £500 (it did last year hence basing my figure at that). So personally I say go for finance, helps if you haggle as well as I got free GAP insurance chucked in.

So, lets say your "cost way more than the car was worth" is double the car's value (probably on the generous side), it cost you £2,700, plus £500 for the upcoming MOT. A total of £3,200. At which point you have a car which at that cost, most likely had most of the failure points repaired, and good for at least another year.

That's just less than 2 years worth of payments on the Fiat, is that on a 3 year or 5 year lease? and how much deposit did you pay?

Like I posted, if you want a new car and can afford it, then by all means, go ahead, but don't be fooled that it's cheaper than the exact same car even 6 months - a year old.

miniyazz · 25 Feb 2014 at 20:06

aaron said:
Ford Ka

There's your problem right there

In all seriousness, if you're spending what sounds like thousands of pounds on maintaining a Ford Ka over the course of <2yrs then you're doing something very wrong.
Obviously depending on mileage, but for <10k miles/yr I would expect to spend the equivalent of probably <£30 and not more than £40/month on repairs with an additional £20/month to cover servicing and general maintenance (tyres etc) for your 'typical' older budget hatchback.

New on finance is fine but as above do it for the right reasons and not to save money.

aaron · 25 Feb 2014 at 22:16

Tinders said:
How??? Theres nothing remotely expensive or labour intensive on a KA to fix, they Rot, but thats something you can spot prior to buying.

A mixture of being a first time buyer and not knowing what to look for and bad luck.

There has been more repairs than this but off the top of my head:

-spark plugs went while driving down the motorway leading to having to get them replaced and the mechanism that powers them (forgot what it is called)

-went round a bend with a load of rubbish on the road bursting one of the tires and leading me to plowing into a concrete barrier, only doing about 25mph so not major damage but it ruined the wheel and wishbone. This is down to bad luck though so not the car itself.

-while in work and the car was parked up the coil spring went on the drivers side front so got that replaced.

- multitude of bulbs and fuses going

-same with wiper motors

-in regards to the MOT sills were rotted so needed replacing which was the major cost but a lot of other stuff on top.

Haggisman said:
So, lets say your "cost way more than the car was worth" is double the car's value (probably on the generous side), it cost you £2,700, plus £500 for the upcoming MOT. A total of £3,200. At which point you have a car which at that cost, most likely had most of the failure points repaired, and good for at least another year.

That's just less than 2 years worth of payments on the Fiat, is that on a 3 year or 5 year lease? and how much deposit did you pay?

Like I posted, if you want a new car and can afford it, then by all means, go ahead, but don't be fooled that it's cheaper than the exact same car even 6 months - a year old.

4 year lease and £200 deposit.

miniyazz said:
There's your problem right there

In all seriousness, if you're spending what sounds like thousands of pounds on maintaining a Ford Ka over the course of <2yrs then you're doing something very wrong.
Obviously depending on mileage, but for <10k miles/yr I would expect to spend the equivalent of probably <£30 and not more than £40/month on repairs with an additional £20/month to cover servicing and general maintenance (tyres etc) for your 'typical' older budget hatchback.

New on finance is fine but as above do it for the right reasons and not to save money.

I do about 20K miles a year, and by all means I am not saying it will be cheaper in the long run certainly not. However considering i am not on the best wage pulling £100+ for random repairs that can hit at any time is not ideal. At least this way I know I am paying £148 a month and can budget to that (plus not having to worry about MOTs, fuels cheaper, tax is a lot lot cheaper and my insurance band has dropped down by a large margin, and if anything goes wrong with the car I dont have to worry about it). Its certainly not for everyone however I am loving the fact that I can now drive my car without fear of breaking down anywhere, which with my old car limited me to just driving around the North East whereas now Ive been going to the lake district/Edinburgh and many other places without worrying somethings going to go terribly wrong.

As I say it's definitely not the best option for everyone and it will be more expensive overall. But for me it has been the right option.

rodenal · 25 Feb 2014 at 22:26

Come on, those are some **** poor attempts at justifying expense.

Spark plugs for a ka are about 20 quid, ht leads ( I'm assuming that's what else you meant) or coils are pennies too.

You hit something and damaged the car...happen no matter what you're driving

Spring...ok but cheap again

Bulbs / fuses who cares

Wiper motor cheap cheap cheap

Rotten sills, fine but not hard to check before buying.

Buying something newer is definitely an "easier" option but in almost no circumstances will it work out cheaper to finance or lease than just buy something cash.

Doing it because you want to or feel it's worth the relative reduction in hassle is a completely different rationale - which is absolutely fine tbh

For the lease money you could easily buy a new (old) Ka or two every year, bin it after mot runs out and move on. I'm not saying you'd want to, or that I'd like to do 20k pa in a Ka, or even 1k in a ka, but just as a point