Good lease deals on less than great cars

[chanjy]

From experience the super cheap deals seem to be 2 years.

My theory is that this is because they have a ton of 3-4 year PCPs coming back all the time, but hardly anyone takes out a 2 year PCP so there's a gap in the approved used car supply chain for 2 year old cars (demonstrators and management vehicles for 0-1 year old), which they then fill with cars coming off 2 year leases.

 

[skaif]

okay i mentioned the the price tag of the car sorry, i dont know what the final payment after interest without looking nor am i bothered, i couldnt afford anything outright, i was just stating how much my car cost and what i am having to pay for it, final price is irrelevant really as not everyone who would pay the same as me likely get the same figure, its dependant on who the financial company being used and what their interest rates are.

but trust me, the cars i was looking at had under 10k or 20k miles are were £10k plus, so the overall wouldve been much higher.

I think ultimately its horses for courses.

Over 4 years I would have paid £10000 on running 2 brand new cars with nothing to show at the end of it and you would have a 9 year old car that you own.

If you're ultimately financially stable to have a continuous £200 debit going out and want to be in a new car every 2 years and can live with the mileage restrictions then bargain leases are the way forward as the worry free motoring I have had has been more than worth it!

If you dont mind buying a depreciating asset and taking care of tax and maintenance for the sake of owning it then buying is the way forward (albeit with a much cheaper loan)

I have set aside a maximum of 10% of my take home to pay the monthlies on my car. Thankfully I am well off that 10% and am happy to pay what I pay. As long as I am aware of total cost and the viability of it vs PCP and I am happy to pay then thats all that matters really.

 

[GinG]

Strange, the majority of the ones I have seen are cheaper on the 24 month profile than on 36/48?

Appreciate this is one example but I thought I would compare prices on the car I have just ordered...
24month
36month
48month

Maybe its just the type of car but I find it typically cheaper to get a 2 year one.

You need to look at overall cost when taking into consideration the deposit + the monthly payments*number of payments/term:

24 month plan (23 month payments) = £287.09
36 month plan (35 month payments = £272.99
48 month plan (47 month payments) = £272.72

Sweet spot on that particular one is the 3 year lease.

 

[Dangerous Dave]

You need to look at overall cost when taking into consideration the deposit + the monthly payments*number of payments/term:

24 month plan (23 month payments) = £287.09
36 month plan (35 month payments = £272.99
48 month plan (47 month payments) = £272.72

Sweet spot on that particular one is the 3 year lease.

You need to take into account tyres/servicing aswell, on a 2 year lease you might make it through without needing tyres/service. I returned a two year lease car back on the original tyres and returned it a week early so the service now indicator wasn’t on.

That would have been an additional £600 ish on a three year deal as it would have needed four tyres and a service by three years old.

 

[Kenai]

You need to look at overall cost when taking into consideration the deposit + the monthly payments*number of payments/term:

24 month plan (23 month payments) = £287.09
36 month plan (35 month payments = £272.99
48 month plan (47 month payments) = £272.72

Sweet spot on that particular one is the 3 year lease.

This is what I was getting at, once you realise you're paying the 3/6/9 month first period more times, the overall costs creep up comparatively on shorter terms.

 

[ExoMale]

I think ultimately its horses for courses.

Over 4 years I would have paid £10000 on running 2 brand new cars with nothing to show at the end of it and you would have a 9 year old car that you own.

If you're ultimately financially stable to have a continuous £200 debit going out and want to be in a new car every 2 years and can live with the mileage restrictions then bargain leases are the way forward as the worry free motoring I have had has been more than worth it!

If you dont mind buying a depreciating asset and taking care of tax and maintenance for the sake of owning it then buying is the way forward (albeit with a much cheaper loan)

I have set aside a maximum of 10% of my take home to pay the monthlies on my car. Thankfully I am well off that 10% and am happy to pay what I pay. As long as I am aware of total cost and the viability of it vs PCP and I am happy to pay then thats all that matters really.

my car met all my requirements and was the best spec for the price, i was looking at those renault captures, a 0.9 turbo version, but in the end it seemed smaller and not as nice inside, im not going to praise my interior as the best obviously, but my 2008 has the nicest interior been in from cars ive owned, granted i dont like finance, but id rather this than cars much older on a finance prospective. the aim was to keep within a 4yr age and under 50k miles at a fair price, id have loved a leon FR estate 1.2 or 1,4tsi, but were too much for everything minus tax same with the FR hatchback versions, but my 307 was becoming worse for wear and had a week to properly source an alternative and on a finance deal due to lack of buyout money, so given i was looking at cars from 05-09 reg then i will have no problem my car being 9yrs old at the end. its not just finance its everything else, a german countrpart would cost too much to run and insure for example.


finance isnt for everyone, but there are good deals to have if you dont limit yourself to just one brand and one destination to buy from, just have to really look for them.

 

[skaif]

Fair points @Kenai & @GinG, never really looked at it as that - I just see cheaper monthlies and deposit on the 24 month deals and automatically thought it would be cheaper. The overall difference isn't huge though and I would rather be in a new car every 2 years as opposed to every 3 or 4.

As @Dangerous Dave has alluded to, the ongoing costs of servicing and maintenance tend to creep up after the first 2 years.

I am hoping to hand my Golf back in June with no charges (its due a service at 20k, currently on 16500) and its tyres are getting on the low side.

We shall see what happens but I would much rather have this headache than worry about an MOT, Service, any other potential problems.

 

[xs2man]

The other thing to remember is that the 3rd and 4th years on such deals cost the same as years 1 & 2. In other words, your getting a better deal on the 2 year deals as the depreciation is higher during these years, than it is in the 3rd and 4th years. So, making sure its the amortised rates that are similar, then years 3 & 4 are "expensive" to be driving a 2-4 year old car, where for the same money, you could be back in a new car. And as said, without the hassle of servicing, MOT's or tyres, most likely.

Looking at GinG's examples:

24 month plan (23 month payments) = £287.09
36 month plan (35 month payments = £272.99
48 month plan (47 month payments) = £272.72

The 24 month plan is around £14 a month more expensive than the other plans. However, the 36 month plan will require at least a service (£300?) and possibly a set of tyres, but lets say you manage to get it back with only replacing a pair of tyres. Still, many modern cars run 18's+ now in their standard spec, so lets say another £200 in tyres. You should get it back before the MOT though, so that'll save £50. But still, that could be an extra £500 in costs to save £14 per month (£500 is £13.88 per month over 36 months). Or, roughly the same cost, more expensive if you end up having to change 4 tyres instead of 2.

The 48 month however, may be looking at a second service if your unlucky, and this would mostly be the "major" service, so maybe £500. And there is a VERY good chance that you will, indeed, need to change the 4 tyres during the deal, maybe even 6 or 8 over the term depending on tyre wear rate and mileage.

Whereas the 2 year deal, you get another new car after 2 years, hopefully at a similar price, and not have any of these "extra" expenses. That would be worth the extra £14 per month to me.

 

[jpaul]

interesting analysis of pcp's by irish consumer research from https://www.ccpc.ie/business/ccpc-publishes-report-pcp-car-finance-market/

...
3.6 While consumers were aware of the initial deposit paid, and whether that was in cash or as part of a trade-in, they did not think of it in terms of a percentage of the overall car value at the time. Most of the consumers who participated in the focus groups said that they could accurately recall their APR and they could compare it to the rates offered for comparable finance products, although it was not possible to test the accuracy of these statements. The consumers asked by the CCPC said that they knew what amount they were paying per month and most based their decision to engage with PCP on the basis of what they could afford each month

3.10 Another common condition of a PCP is servicing requirements. The dealership can specify where the car hasto be serviced, how often it should be serviced and in some instances what the service should include. Although the research indicated that the possible expense of not being able to arrange the service elsewhere could be a source of annoyance for consumers, it also highlighted that consumers were made aware of this condition by the dealers prior to entering the contract.

3.11 Penalties for excessive wear and tear are a specific condition of PCP agreements. Discussions with consumers indicated that they were not confident as to the definition of excessive wear and tear and what this could mean at the end of the term. This suggests that this issue may not be adequately explained to consumers at the point of sale including, for example, what the dealership’s definition of excessive wear and tear is, how it affects the vehicle’s value, and the penalties or charges that may be incurred by the consumer.

Misconceptions regarding the equity – Although the GMFV is set to allow for fluctuations in the second-hand car market, the CCPC’s research indicated that consumers could not imagine a situation where there would not be enough equity in the car to roll their PCP. Rather, there is a perception that the providers of PCP finance have ‘engineered’ the GMFV so that there will always be some equity left in the car in order to encourage consumers to roll into another PCP contract. As discussed in Chapter 2, a sudden decrease in second-hand car values could affect the amount of equity in the car at the end of a PCP contract.

 

[Kenai]

Interesting but this is a thread about leasing deals not PCP finance.

 

[leon4112]

I've requested a quote for a VW Polo GTI+, oddly it was cheaper in black than the standard red, £138pm.


Hopefully payroll get back to me pretty quickly with it, haven't been in the office for a few days so might pay them a visit tomorrow when I'm in to find out how long they take to sort it.

The polo is worth looking at I was going to get one through my work the same way but got a really good deal on a new Golf Gti picked it up 1st March £181 quid inc insurance and tires

 

[squerble]

Had a quick look at some deals on a Fiesta Titanium X (initially with no options). RRP is £19,640 for the base Titanium X model, and Stoneacre Leasing Ford will do a 3+35 deal for £670.43 + £223.48/month for a total of £8,492.23 for three years (£235.90/month amortised). That seems "reasonable" at 43% of RRP? Although, the standard colour is a flat red which is a bit meh.

I've asked for a quote which would add a metallic paint, full LED headlamps, and the Driver Assistance Pack (adaptive cruise and collision prevention), a spec which Ford says RRPs at £20,935. If the quote back from Stoneacre with options is around 43% for three years, does that seem somewhat reasonable?

 

[chanjy]

Had a quick look at some deals on a Fiesta Titanium X (initially with no options). RRP is £19,640 for the base Titanium X model, and Stoneacre Leasing Ford will do a 3+35 deal for £670.43 + £223.48/month for a total of £8,492.23 for three years (£235.90/month amortised). That seems "reasonable" at 43% of RRP? Although, the standard colour is a flat red which is a bit meh.

I've asked for a quote which would add a metallic paint, full LED headlamps, and the Driver Assistance Pack (adaptive cruise and collision prevention), a spec which Ford says RRPs at £20,935. If the quote back from Stoneacre with options is around 43% for three years, does that seem somewhat reasonable?

Sounds pretty terrible

You can already get nearly £3k off on broker sites and dealers are offering 0% finance on PCP.

Once you add options it's worse because leases usually make you pay the full option price in the 3 years of the contract while a PCP tends to get added residuals from the options, to slightly lower monthly payments

 

[Invertigo]

Agreed, you need to be looking at the real broker selling price and not the manufacturers RRP

 

[squerble]

Sounds pretty terrible

You can already get nearly £3k off on broker sites and dealers are offering 0% finance on PCP.

Once you add options it's worse because leases usually make you pay the full option price in the 3 years of the contract while a PCP tends to get added residuals from the options, to slightly lower monthly payments

So DTD are saying £18,075 with options, and I could qualify for the Ford scrappage scheme to get a further £1,500 off, but... I'm about to move house and I'd have to get the V5 sent off for my current car to move it to the new address, order before 31st March (can't order without the V5), and somehow make sure the car is delivered before the end of September to make sure I get that further discount. Ford are doing 0% finance for 24 month deals only, and 1.2% for 36 month deals.

Plus, I think with the house move, my credit rating may take a bit of a beating as I come out of contracts etc for my utilities as I'm moving in with someone.

 

[Kenai]

At those sort of figures, I would be expecting to get into a VW Golf as an absolute minimum, probably a mid spec Audi A4, BMW 3.

 

[squerble]

At those sort of figures, I would be expecting to get into a VW Golf as an absolute minimum, probably a mid spec Audi A4, BMW 3.

The lowest I've seen an A4 so far was a 6+23 deal, £1,463.52 + £243.92/month for a total of £7,073.68 (or £294.74/month), and that's for an A4 1.4TFSI Sport S-Tronic with leather (missing out on the Tech pack with Tech it was about £311.46/month amortised for two years). If you look at 36 month deals with the A4 the price shoots way up - no idea how the 24 month works out so cheap with them. Although I've had a couple of dealers say the lead time is about 12-16 weeks too.

 

[Kenai]

https://www.selectcarleasing.co.uk/...4t_fsi_se_4dr/36/8000/3/72535-12292-2018.html

Something like that would appeal more than a Fiesta, even though its only an SE.

 

[squerble]

https://www.selectcarleasing.co.uk/...4t_fsi_se_4dr/36/8000/3/72535-12292-2018.html

Something like that would appeal more than a Fiesta, even though its only an SE.

Miss out on leather, heated seats, sat nav, better audio system etc with SE. I wouldn't take that over the Fiesta. IMHO, if I'm going to be shelling out hundreds a month, it'll be on a car with a spec I want, not skimping on features to save a little otherwise I'll find myself just wanting another car before I've even got the new one!

EDIT: Sorry, this post came across a bit more confrontational than I intended! I just have a certain spec in mind, and I can be fussy on interiors, so I'm getting very limited in my choices available.

 

[Kenai]

Ok, well that's just one quick example I could find. I can't imagine there's nothing better than a Fiesta around for £240 a month. If you're spec fussy though, leasing isn't likely to be the best way to get into the car you want, PCP will probably suit better.