Car leasing

[knoxvillain]

hi there,

 

I've been fortunate enough to have been offered, and have accepted, a new job with Dell. As part of this I get a car allowance. They require me to get a car less than 5 years old. I was wondering if anyone can recommend good places to lease a car from? Thinking Ford Focus or something similar.

 

My credit history isn't great of recent but I don't believe any defaults have been recorded yet but might be shortly. Someone told me they were able to get car finance even though they couldn't get other finance because the company view it that if you don't pay they just come and get the car back, is that right?

 

Any advice appreciated.

 

Ian

[barracad]

So do you want to lease a car, or buy a car on Hire Purchase/PCP?

 

There is a difference, as one is renting and one is buying on credit.

 

And yes, car finance is usually somewhat easier to get as they can take the car away - but if you are leasing there is no credit involved.

 

 

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[knoxvillain]

Hmmm well I was looking at one of those things where you can lease it and then at the end of the three years you can hand the car back and it's done, continue paying and get a new car or pay the value and own it?

 

The biggest thing I have to consider is the mileage I do which is about 25k-30k miles a year so maybe I'm better going for one of those lease deals where it's fully maintained.

[barracad]

"One of those things" you refer to is Personal Contract Purchase (PCP).

 

If you are looking at this option, I would be tempted to avoid any of the places with the cheesy adverts on TV and go along to your local Ford dealer (assuming it is a Focus you want) and asking them about their PCP options. They will be linked to some kind of finance company and if you take up their finance you are likely to get a better deal on the car and have more bartering power.

 

When you have got a quote, shop around with a few different companies, even if it is just comparing a couple of quotes on the net.

 

Also check if there are any restrictions with the PCP as to mileage etc. Either way, a Focus in three years time with an extra 90k miles on the clock is going to lose a lot in depreciation - I would be tempted to look at a VW Passat, Vauxhall Vectra or similar if you are planning on doing that sort of mileage. (obviously depends on your budget).

 

 

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[barracad]

Just a couple more points...

 

If your credit record isn't too bad, you'd probably get a better deal from a personal loan.

 

And you will get a much better deal when buying your car if you aren't trading your current one in, so consider selling this privately.

 

 

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[knoxvillain]

I currently have a company car (astra) which I'll hand back when I switch job so no car to trade in anyways.

 

Given the mileage I would do, surely I would be better with a PCP where I can hand the car back after 3 years or something rather than buying a car and sticking 90k on it?

[barracad]

Yes but remember with PCP you have the option of buying the car at the end, which you may decide to do if you like the car. Therefore consider what the car is going to be worth in 3 years time with an extra 90k on it - that's why I suggested a Passat or similar.

 

Think how many people drive a focus - a high mileage focus isn't going to be worth much as there will always be plenty of fairly low mileage ones available for sale second hand. Something like a Passat is generally considered more of a business car and expected to have higher mileage.

 

At the end of the day it is personal taste and budget so go whatever you feel comfortable with, but think what you are going to do at the end of the 3 years.

 

Whatever your decision, make sure you shop around and haggle!

 

 

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[LondonPam]

make sure you shop around as many of these options charge a lot for "extra" miles. Some have a very low mileage so make sure you ask about 30K miles when you call them.

[Jimbo44]

make sure you shop around as many of these options charge a lot for "extra" miles. Some have a very low mileage so make sure you ask about 30K miles when you call them.

 

Absolutely right, LondonPam! PCP's rely on the "Residual Value" of the car at the end of the contract and so it's vital that you declare the anticipated mileage at the outset. Failure to get it right at the beginning could mean you having to pay additional, excess mileage charges (at x pence per mile) at the end of the contract.

 

From my own experience of the retail motor industry (albeit ten years ago) I have reservations about finding a reputable dealer willing to sell a second-hand car on a PCP to someone doing 30k miles per annum. A "back street johnny" maybe, but not a "dealership"! (You did say the car had to be less than five years old, so I'm assuming you're looking for a used car!)

 

Another point to note is that, with your anticipated mileage, you could well be better off in the long run considering a diesel engine too.

 

 

Jimbo44