Car leasing as a private individual - any good?

[beanzontoast]

Anyone got experience of car leasing in a non-business customer context? Our old car's seen way better days and we're exploring all options for the replacement, including leasing from new. We thought about it a while ago when Mrs B's work started a scheme for employees, but she's not working there any longer.

On the face of it, leasing seems to have some benefits. No whopping sum to find initially, servicing taken care of, roadside assistance, road tax etc. Admittedly, you don't have a car that's yours at the end of it, but from what I understand you don't have the depreciation or the worry when / if stuff needs doing to it either.

Interested in any experiences - good or bad - that people have had please.

 

[rsvdaz]

dont you have to make a balloon payment..like 3 months up front then 36 months as a 3 year term?..also the prices advertised are usually plus VAT

 

[swee'pea99]

Leasing makes sense for companies because there are big tax advantages. Unless you desperately want a brand new car (that you can't afford to buy) I think it's a pretty poor option for the average private punter. You'd be much better off buying a good second hand car.

 

[oldfatfool]

Occaisonally a good leasing deal will crop up if they have got a good deal from the manufacturer and pass it on

 

[Norm]

I've a friend who has been doing it for about 10 years. He changes his car every 3 years, he sticks to what he knows he can spend with no surprise repair bills, no MOT worries, no need to go through the pain of selling at the end of the contract... he is delighted with the deal.

I, however, can use a calculator to work out that buying his three year old car and running it for 3 years will have lower depreciation, minimal repair costs and it will be my car throughout.

If you value your time highly, then it may be some good as it is a very easy option, but, all other things being equal, it is more expensive than buying.

IMO

 

[beanzontoast]

Interesting stuff - thanks everyone.

It's a bit of a trade-off really then? If I accept that it will cost more for the peace of mind and absence of hassle and can find a good deal, then it might be worth it. OTOH, I might be lucky and find myself a bargain in a 3 year old second hand car that's not going to give me any major headaches for a few years.

Why I'm considering it is that I think we might be getting past the stage of taking risks. Most of the time - and we've had 8 used cars in our married life so far - they've been reasonably good buys. I'd say 2 of the 8 weren't so good. One that a garage sold me was more clapped out than I knew, but I was inexperienced when I bought it and didn't have anyone to ask about it. That lasted about a year. Another was a private sale and turned out to have an intermittent fault that bugged me and the local garage for 2 years as we couldn't afford to change the car again so soon.

Any more thoughts welcome.

 

[colly]

I've never leased or contract hired a car but have had a van. OK the cost goes against my tax, but the first time I did it (about 10 years ago) that was just one of the considerations.
It is expensive on the face of it and no doubt if you are in a position to be able to stump up say 7 or 8 thousand for a good second hand vehicle then maybe you would be better off doing that.

On the other hand you might be in a similar position as I was at the time, limited funds, and the necessity of proper transport. I had about £2500 maybe £3000 I could spend on a van. That would have left me pretty much skint. I looked at lots of vans all around £2000 to £3000 and it was a depressing business. Most of them were little more than sheds on wheels. MOT'd to be sure but knocked about and in need of attention whatever the paperwork said.
So I had a dilemma. Do I spend 3k on a van that might well need another thousand (that I didn't have) spending on it, that might well have some serious problem crop up soon after I had bought it. I would then have to find more cash to put into a vehicle that really wasn't worth it. The vehicle would be too expensive for me to scrap and not really worth putting any more into it. I would be back at square one and several pennies out of pocket.

I saw a deal offering a brand new van, all the usual stuff that's on them nowadays, for 3 months rental down and 35 payments thereafter. At the time £199 per month including VAT. From my perspective it was a no brainer really. £600 and I had a smart new van, book price around £15000, under warranty, taxed, no MOT to worry about, breakdown cover included, and stuff like tyres servicing and running repairs a thing of the past. ( The first service was at 24000 miles )

Ok it was 200 pounds a month that I would never get back but taking the chance on a second hand van I decided to be not worth the risk. Over the 3 years it set me back £7600 but I think that even if I had bought the van outright I would have been in no better position allowing for depreciation etc.

Well it worked for me for a good number of years and the expense was just one of the costs or being self employed. I didn't take out a new van recently because I deemed the costs too much just now. £300 plus per month and additional costs for the insurance too.
So I plumped for a old van costing £1000 with a full years MOT which, if it gets through the next MOT ok and lasts for another year I will think it owes me nothing. It's nowhere near so nice driving an old noisy van but I don't do many miles and I can live with it.

Of course 300+ notes a month saved is welcome too.

 

[TheBoyBilly]

For what it's worth, I bought a 4-year old ex-fleet MkV Cortina many years ago for buttons and it ended up being the best car I ever had for reliabilty and cost. Full service history with a reasonably high mileage too. I sold it on (trade-in) and was pleasantly surprised at how little (in real terms) I lost.
Buy used, and let the initial owner take the hit is my advice.

Bill

 

[Strick]

You can also get some cracking deals on Ex-demonstrators, and if theyre up against a target nearing the end of their financial year, unregistered cars from dealer stock can have some HUGE discounts as I found out in March.
Sadly, it means they wont neccessarily have one of the spec you want, but I took advantage of them really "needing" to shift their demonstrator.

As for private leasing, it is interesting you mention this as we had one of our suppliers do a training session for a new product line we are stocking. (I work for a motor factor). We had a good chat about it, and wouldnt be at all surprised if, over the next few years, more individuals go down the leasing route.
I know some people that do it, and it works for them. Theyre not bothered about having their name as the vehicle owner, and if you get a lemon (rarer these days i know), it is much easier to get rid of.

 

[e-rider]

3-4 year old secondhand, 1 owner, 20K on the clock etc, is the best option (if it's been well looked after)

 

[beanzontoast]

Thanks all - good to hear these thoughts and suggestions.