Finance or rent for a new car?

(3 Posts)
NutritiousAndDelicious Sat 10-Aug-13 23:03:22

Am thinking of getting a new car, I don't have a large deposit, so I have been looking at leasing for 24 months then leasing a new one after that etc etc. but is it better to pay it off then own it?

Help me please!

WMittens Sat 10-Aug-13 23:49:11

Reasons for leasing/PCP/contract hire:
- You want a car that no one else has sat in
- You have very specific requirements about colour, interior, optional extras etc.
- You can afford a brand new car and the depreciation that goes with it
- You can stick to the annual mileage limits

Things to bear in mind:
- It is not cheaper than buying outright
- It does not save you money over buying new
- A bank loan is almost always cheaper and more flexible - but higher monthly payments
- You are tied in for a long time (although I believe you have more rights around ending the contract with PCP compared to leasing or contract hire)
- You need some savings for the end of the contract, either for a balloon payment to buy this vehicle, a deposit for another lease or for buying a different secondhand car
- Some companies can be buggers for charging you for stone chips, scratches, kerbed wheels etc.

Personally, I'd always recommend getting a secondhand car, say, 2 to 5 years old (depending on price point and what you're after). If you're fussy about having the right spec and not having someone else's dead skin cells in it then go new, but it's a lot to pay for the privilege and a shiny new registration number given what you can get used.

But, someone has to supply the used car market for people like me grin

Buying new is very expensive, however you do it. New cars shed more than half their value in the first 3 years.

The only thing more expensive than buying a new car every 2 years, is buying a new car every year.

It's up to you how you spend your money of course, but new cars are definitely an expensive luxury.

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