Cheap Leases

Some personal lease (contract hire) deals are so cheap it makes no sense to buy a car from a dealer any more. The car companies offer massive discounts to the leasing companies which the dealers dont have access to

Tilsun have Ford Focus from £120 per month - £4,050 in total for a two year lease with no road tax to pay and no breakdown or repair worries. £4,050 is much less than the car would depreciate in that time. I got a Qashqai from them and am looking round for a replacement atm. They aren't great for niche cars but for something mainstream its cheap as chips. At the end of the lease you walk away, theres no ballooon payment of any sort.

http://www.tilsungroup.com/ford-focus-1.6+tdci+115+zetec+5dr-car-19411#.VEet-_nF89Y

nb I have no link to Tilsun or any other company, I just think there are some very good deals

It IS a good deal, but although there's no balloon payment at the end, there is an initial payment of £1200 to think about. I know you've included it in your calcs, but some/most just dont have that to lay out upfront.

Also, what's your view on never owning a car again... if you keep on leasing? Yes, you get 'worry free' motoring all the time, but you're paying £120+ p/m for ever.

Considering this myself, but those ^ are my concerns right now

It IS a good deal, but although there's no balloon payment at the end, there is an initial payment of £1200 to think about. I know you've included it in your calcs, but some/most just dont have that to lay out upfront.

 

Also, what's your view on never owning a car again... if you keep on leasing? Yes, you get 'worry free' motoring all the time, but you're paying £120+ p/m for ever.

 

Considering this myself, but those ^ are my concerns right now

But the thought is that all your paying is the depreciation, so you're not actually spending anything. If it's between buying a brand new car and leasing then leasing is efinitely the way to go. Second hand it all changes as depreciation obviously drops and plateaus after the initial 3 years, so comparing it to buying a 3 year old car it isn't so good.

Does anybody on here do PCP to finance their car? Not something I've had experience of, I don't change my car a lot (we've had 4 cars in 20+ years) and have always bought a car outright with a mix of cash savings, bank loan and PX.

Mortgage now done and we can afford the payments on something a bit reasonable and looking at PCP as one option. My car is prob worth 3k - 4k PX and we can rustle up a bit of cash as a deposit as well. Bewildering array of choices where to go from here: bank loan and buy outright, lease, PCP, HP, finance rates available from 0% to 15%-plus etc etc etc.

Any tips on what would be the best way to go from here? We do quite high mileage (18-20k), it doesn't necessarily have to be a brand new car, ambivalent about keeping it beyond three years, would consider buying it after three years if it's value for money, though there is the issue of saving for or financing the balloon. Also thinking it could be expensive to walk away and start again. How accurate are the GFVs? Are we likely to have any equity in a car to trade on after 60k miles? How strict are they on fair wear and tear etc, I know what a car will look like after I've had it for 60k miles.

Lease could be one way to go (some of the prices on that link are ridiculous, what's the catch?!) - one simple affordable payment - but no capital in the car and the day you stop paying you don't have a car and have to start again from scratch.

Tempted to buy a low-mileage ex demonstrator or similar, they seem to be regularly available, often loaded with (expensive) options, for the price of not having a brand new car you seem to get a lot more for your money. (though finance seems dearer than on a new car, no 0% special deals available!)

I'm sure I could work it all out on a spreadsheet based on total cost of ownership over 3, 5, 10, 15 years with variations built in on changing my car every 2/3/5/10 years ... but I really can't be bothered....

Any advice from anybody in the car game, finance game, or in a similar position scenario gratefully received.

It IS a good deal, but although there's no balloon payment at the end, there is an initial payment of £1200 to think about. I know you've included it in your calcs, but some/most just dont have that to lay out upfront.

 

Also, what's your view on never owning a car again... if you keep on leasing? Yes, you get 'worry free' motoring all the time, but you're paying £120+ p/m for ever.

 

Considering this myself, but those ^ are my concerns right now

You dont have to pay that much upfront. The £1,200 is based on paying 9 nine months initially and then lower repayments monthly. You could opt for three months initially and then slightly higher monthly payments - it would be something like £550 upfront and £150 pm. The total amount you pay doesnt change, its just phased differently. Tilsun will happily give you quotes for different permutations. Longer contracts - three to five years tend to be cheaper for obvious reasons.

 

Lease could be one way to go (some of the prices on that link are ridiculous, what's the catch?!) - one simple affordable payment - but no capital in the car and the day you stop paying you don't have a car and have to start again from scratch.

 

 

I'm sure I could work it all out on a spreadsheet based on total cost of ownership over 3, 5, 10, 15 years with variations built in on changing my car every 2/3/5/10 years ... but I really can't be bothered....

 

Any advice from anybody in the car game, finance game, or in a similar position scenario gratefully received.

Im not in the car game and know little about PCP but I did look into contract hire quite a lot, and even did a spreadsheet when I got mine!

For the Nissan Qashqai I leased two years ago the main dealers best PCP deal was £3,500 upfront and £460 per month with a guaranteed future value which was unlikely to leave me any equity in the car. Those figures are more than double the cost quoted by Tilsuns at the time, so obviously I went with the contract hire. You also don't have to pay road tax as that is paid by the lease company.

If you were to get the exact same Focus on the Ford options programme (ie PCP) over two years with same deposit the monthly cost would be £335 (Yeah I actually went and checked ), more than 2.5 times the contract hire cost.

If you were to borrow the money at 6.7% to buy the car, paid the same upfront (£1,200 + VAT) as deposit and the same monthly payment of £120pm at the end of two years you would still owe £14,000 on the loan and have a car worth around £10,000 (according to current prices on autotrader).

Normally when you're buying something the best thing to is find what you like and see how the sums stack up for each option. With contract hire imo its best to find what is a really good deal at the time (as long as it fits your needs and you like it of course) and go for that.

Im not in the car game and know little about PCP but I did look into contract hire quite a lot, and even did a spreadsheet when I got mine!

 

For the Nissan Qashqai I leased two years ago the main dealers best PCP deal was £3,500 upfront and £460 per month with a guaranteed future value which was unlikely to leave me any equity in the car. Those figures are more than double the cost quoted by Tilsuns at the time, so obviously I went with the contract hire. You also don't have to pay road tax as that is paid by the lease company.

 

If you were to get the exact same Focus on the Ford options programme (ie PCP) over two years with same deposit the monthly cost would be £335 (Yeah I actually went and checked ), more than 2.5 times the contract hire cost.

 

If you were to borrow the money at 6.7% to buy the car, paid the same upfront (£1,200 + VAT) as deposit and the same monthly payment of £120pm at the end of two years you would still owe £14,000 on the loan and have a car worth around £10,000 (according to current prices on autotrader).

 

Normally when you're buying something the best thing to is find what you like and see how the sums stack up for each option. With contract hire imo its best to find what is a really good deal at the time (as long as it fits your needs and you like it of course) and go for that.

Cheers for info, now I just need that spreadsheet and I can start to triangulate what's on offer v what I can afford v what I like. Who'd a thunk treating yourself to a new car could be so complicated?