Lease Deals

[pauljbpaul]

I'm not convinced.

I'm after a Vivaro at the moment.

Special lease deal:

http://www.vanleasingspecialoffers.co.uk/van-leasing-special-offers/Vauxhall/Vivaro/8359092/

£6584 cost after 3 years, no van to show for it and every ding and scratch is a big problem.

Outright:

http://www.perrys.co.uk/used-search...m_price_F=0&to_price_F=9999999&vehicle_type=V

£9970 mine forever (in fact I fount an 08 08 del miles for £8778 but I can find it right now)

So leasing costs £3386 less than buying, but I get to keep the van.

The only thing i can see wrong with your plan is that i wouldnt want to pay £3386 for a van that you have used for 3 years , in fact i dont think i`d want to pay £33 for it as ive seen how they look after a month never mind 3 years

 

[nick mercedes]

I wouldnt want to pay £3386 for a van that you have used for 3 years though , in fact i dont think i`d want to pay £33 for it as ive seen how they look after a month never mind 3 years

I only run mint vans these days.

You should see the Boxer I brought the other day, brought off some kid in Birmingham, nice lad but he seemed a bit slow if you know what I mean...

 

[Mudster]

I'm not convinced.

I'm after a Vivaro at the moment.

Special lease deal:

http://www.vanleasingspecialoffers.co.uk/van-leasing-special-offers/Vauxhall/Vivaro/8359092/

£6584 cost after 3 years, no van to show for it and every ding and scratch is a big problem.

Outright:

http://www.perrys.co.uk/used-search...m_price_F=0&to_price_F=9999999&vehicle_type=V

£9970 mine forever (in fact I fount an 08 08 del miles for £8778 but I can find it right now)

So leasing costs £3386 less than buying, but I get to keep the van.

That deal is less cut and dry, mainly because the value of the vehicle is a lot lower therefore there's a lower margin...I'm not for one minute suggesting every lease is better then every purchase, I'm saying look for the deals, it can be a huge saving leaving someone else to pick up the baby....

Also Gizzie makes a good point which is how I choose cars.

I just ask what's on offer, I'm not overly bothered what I drive as long as it's comfortable and presentable, the less choosy I am the better deal I get.

If I walk in to a dealership and spec a car up just for me I'm going to be paying top money, lease or no lease, if I walk in and say "What do you want to sell me that I can get a deal on?" I'm Mr perfect customer that's going to get a good deal.

 

[pauljbpaul]

I only run mint vans these days.

You should see the Boxer I brought the other day, brought off some kid in Birmingham, nice lad but he seemed a bit slow if you know what I mean...

Thats my strategy i make myself appear a little slow so that way my oponent thinks he` got the upper hand, how else was i going to get rid of that dog of a van ? with all this credit crunch mugs like you are getting harder to find

By the way wheres my bits ?

 

[st4]

It's just like renting a car really, all that money wasted and nothing to show at the end of it...

But there is something to show for it, 3 years of usage and 30k miles driving.

 

[Rory]

But there is something to show for it, 3 years of usage and 30k miles driving.

Please don't kick it off again - nick mercedes was having an entirely different argument to the perfectly valid point that Mudster made.

 

[Sp!ke]

I think it depends on the used values of the vehicles involved as to whether it makes financial sense.

A new 26k car being only worth 7.5k after three years in my mind doesn't make any sense but then neither does leasing for 13k over the same time period.

Buying the same 3 year old car for 7k and keeping it in the family for another 7 years before selling it on for 2K is what I'm inclined to do. Why do people think they *need* new cars anyway? Clearly the marketing spin works wonders....

 

[Dryce]

I
If buying a car was more financially viable why does almost every single business lease instead?

Because it is treated as an expense rather than capital.

 

[Mudster]

Because it is treated as an expense rather than capital.

Absolutely, meaning off balance sheet so it's listed a simple operating cost and allowing the capital to be used elsewhere in the business.

 

[Mudster]

I think it depends on the used values of the vehicles involved as to whether it makes financial sense.

A new 26k car being only worth 7.5k after three years in my mind doesn't make any sense but then neither does leasing for 13k over the same time period.

Buying the same 3 year old car for 7k and keeping it in the family for another 7 years before selling it on for 2K is what I'm inclined to do. Why do people think they *need* new cars anyway? Clearly the marketing spin works wonders....

In my mind, the answer to this is how much does a vehicle matter to you?

I travel around 25K miles a year. Buying a new car is no guarantee of trouble free motoring, but your chances are a lot better.

Losing business if my vehicle breaks down or is off the road could cost thousands....not having to worry about repair costs that could cost thousands.

So I choose to buy new partially for peace of mind, partially because I own a Limited company and it's tax efficient and partly because I like the fact the car is new and I have nothing to worry about if it does go wrong.

Now, if you go to work on a train 5 days a week and use your high spec car at weekends only, do less than 10K miles a year and really treat it as a leisure vehicle. Then that's a whole different conversation and frankly you're probably better off buying a low mileage used car.

Whenever I have a plaything car..it's always used and always bought outright.

But my daily driver I lease, it is after all, just a piece of business equipment to me.

This is where the lease vs buy arguments go a little awry....it all depends on what your use is and other tax considerations.

I wouldn't dream of having a second car financed, leased or on any form of payment plan for that matter...I'd buy it, but that's because it's nothing more than a toy.

The only hole in your statement above that I see is, buying my Saab for £7K once it has 75K on the clock.......at that point I see the car as a liability, at the end of it's viable working life...in all likelyhood it'll be falling to pieces..that's why I'm getting shot of it and getting another one.

 

[Dryce]

Absolutely, meaning off balance sheet so it's listed a simple operating cost and allowing the capital to be used elsewhere in the business.

Traditionally the real attraction was that you could write off the whole lease costs each year as a simple expense and get tax against it as opposed to having to take the whole purchase up front and then use depreciation/capital allowances.

This is further distorted by the fact that businesses generally only go for new cars.

In reality the cost of leasing is generally higher - but the accounting advantages offset this.

At the moment it the burden of risk with regard to actual residual values means that some of the leasing deals look good. However as said elsewhere it's not black or white and depends on circumstances.

 

[Sp!ke]

Ahh but a 75k mile Mercedes is merely run in. Buying a Saab is where the root of the problem lies.


I agree though, for a business lease its a different kettle of fish and for tax reasons alone it makes things far more attractive.

 

[jaymanek]

Saabs are bloomin uncomfortable though....

 

[NewMB]

Saabs are bloomin uncomfortable though....

Compared to a Volvo, yes, Mercedes - depends, and they will certainly do alot more than 75K.

 

[ant500sl]

"If it appreciates buy it, if it depreciates lease it."

A little pearl of wisdom from a certain Mr Rockefeller who happened to become the worlds first billionaire in about 1917!

Would imagine that he probably knew what he was talking about?

 

[st4]

Please don't kick it off again - nick mercedes was having an entirely different argument to the perfectly valid point that Mudster made.

I wasn't trying to cause trouble., just point out that the lease etc does having a benefit, the use of a £26k car over 3 years doing however many miles you ask for. People buy cars to do the same, drive them. There is nowt worse than a car that isn't being used.

 

[Dryce]

I wasn't trying to cause trouble., just point out that the lease etc does having a benefit, the use of a £26k car over 3 years doing however many miles you ask for. People buy cars to do the same, drive them. There is nowt worse than a car that isn't being used.

The simple way of working out whether the deal is good or bad is to just work out the annual costs of the car.

With a lease the customer caps the risk of depreciation. The vendor selling the lease is betting that they will recover the costs plus profit. In general the lease should cost more.

However as has been alluded to above the manufacturers use the lease as a means of shifting cars - effectively at below list. I would assert that leasing perpretrates the myth of the list price and possibly confuses some sections of the market as to depreciation.

Even prior to the current crunch depreciation on MBs wasn't as good as the reputation.

The current situation means the lease deals can look very good against the new list. But the used market has collapsed as well - and doing the sums as to which is better depends on that annual cost, your usage, the model and spec you want, and how you would pay/finance a car vs a lease.