I've joined a few 'newer car' groups on Facebook recently (MBQ based VAG & a couple of F series BMW groups) and it really does amaze me how much people spend a month on leasing. I know everyone is different etc etc but I was certainly an eye opener to see people paying upwards of £400/£500 a month on a lease car while still living at home with parents. Made me feel a bit better about the mrs £100 odd a month for the last bit of her 3 series to be paid off if nothing else. 

11 minutes ago, matt1chelski said:

I've joined a few 'newer car' groups on Facebook recently (MBQ based VAG & a couple of F series BMW groups) and it really does amaze me how much people spend a month on leasing. I know everyone is different etc etc but I was certainly an eye opener to see people paying upwards of £400/£500 a month on a lease car while still living at home with parents. Made me feel a bit better about the mrs £100 odd a month for the last bit of her 3 series to be paid off if nothing else. 

 

Plenty of people who pay a grand a month on car leases.   

 

My contention is that although one might get a car allowance of £500, £750 a month or £1,000 a month one gets whacked for PAYE on it and then one has the other running costs ie servicing and tyres so spending much more than half of a car allowance on the lease cost and one is going to be very out of pocket.  Many are OK with that as the car is such as status symbol so are willing to subsidise from their other part of their wages.   

 

Here is a scare scenario...      http://www.thecarexpert.co.uk/options-the-end-of-your-pcp/

 

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Understanding the final payment

The final balloon payment at the end of a PCP is often also called the guaranteed future value (GFV), which is technically a different thing but it doesn’t matter for now. Many finance companies humorously describe it as the “optional final payment”, making it sound like you don’t have to pay it unless you want to. The reality is the exact opposite, and it can have disastrous consequences for your personal finances.  What is very important, and generally not explained by car dealers, is that paying off the balloon is the default option of the three choices listed above at the end of a PCP. The finance company will try to take this huge final payment from your bank account unless you take specific action to avoid it.    The problem is that you probably don’t have several thousands of pounds sitting in your current account when the finance company tries to take the final payment. The payment bounces and, suddenly, you have defaulted on your loan (probably with a default fee from your bank as well).    

 

I'm due to hand my car back in May and have been looking at deals, looks like I will either lease or buy something second hand, the interest rates on used is around 9.9% so will buy cash or get a bank loan.

 

Similar to the OP I found PCP a cheap way of having a new car. I don't really want to eat into savings as I then have less to fall back on should the **** hit the fan

Just checked out one of my PCP and the balloon payment is only £3,400 and equivalent cars seem to be going for close on  £5k so best to pay this balloon payment and sell or trade in the car sometime after the PCP is all concluded.  Looks like this one will have worked out OK and I hope the other one, on a Clio which was second hand, works out as well.  

 

On ‎13‎/‎12‎/‎2017 at 07:07, lol-lol said:

Just checked out one of my PCP and the balloon payment is only £3,400 and equivalent cars seem to be going for close on  £5k so best to pay this balloon payment and sell or trade in the car sometime after the PCP is all concluded.  Looks like this one will have worked out OK and I hope the other one, on a Clio which was second hand, works out as well.  

 

Get your next model now on the cheap rates ?

https://www.autocar.co.uk/car-review/dacia/sandero-stepway/first-drives/dacia-sandero-stepway-lpg-long-term-review

 

On 12/14/2017 at 08:15, vrskeith said:

Get your next model now on the cheap rates ?

https://www.autocar.co.uk/car-review/dacia/sandero-stepway/first-drives/dacia-sandero-stepway-lpg-long-term-review

 

 

 

Like the Stepway but no to LPG as to the limited range and fuel cost not so important with a fuel card.

 

Good website to find the best PCP deals   ....    https://www.contracthireandleasing.com/personal/car-leasing 

Edited 17 December, 20178 yr by lol-lol

On ‎17‎/‎12‎/‎2017 at 05:15, lol-lol said:

 

Like the Stepway but no to LPG as to the limited range and fuel cost not so important with a fuel card.

 

Good website to find the best PCP deals   ....    https://www.contracthireandleasing.com/personal/car-leasing 

 

That model is a petrol (same as UK model with normal size petrol tank ) plus a LPG tank (in the spare wheel well)  - so increased ranged over just the petrol version.

The Octavia that I just got rid of, the PCP final payment (balloon)  would have been very close the value of the car.  I suppose that's the advantage of PCP over standard HP or cash purchases to consumers, if the prices plummet the Finance (read Manufacturers) take the hit.

 

Edited 18 December, 20178 yr by io1901