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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

to want to buy a new (second hand) car rather than lease a new car

180 replies

Hotfootit · 12/10/2017 13:10

We have two cars. Our second car is breaking down and the MOT is due very soon. Our first (family) car has been in the garage for 6 weeks and we have tried to manage with one car. We can just about do it, but it's a real performance and we've had ask for lifts to out of school activities (not being a CF as we've given most of these friends reciprocal lifts at one time or another).

DH wants to look into leasing a new car (is it PCP?). I think I would rather buy second hand and then we will will own the car (might have to buy with a bit finance, we're not sure yet). We've had what is now our second car for 12 years - we bought it second hand and it was our only car for 9 years, and was the first car either of us had ever owned - so we're not into changing cars regularly. What are the benefits of a leased car?

OP posts:
Frouby · 13/10/2017 07:26

We looked at this a couple of years ago. We got a bank loan in the end, bought a 4 year old car and have 2 years remaining on the loan.

My concern was if our financial position changed in the 3 years we may not be able to secure a new deal at the end of the term. Dp is self employed and we have our own business so financially we can fluctuate. We knew we could afford the finance payments and if we couldn't we could sell the car and pay the loan off as it's not going to depreciate like a new vehicle would.

I will keep the car (well it's a pick up, we have horses) until it dies and I only do about 6k miles a year so it should last a good while if we look after it. We always have our vehiclea serviced annually and dps car is currently in 200k miles so I think it does make a difference.

marble11 · 13/10/2017 07:30

It's all on the never never. A lot of my friends brag about their nice new cars while I drive a 5 year old car but they will never own theirs.

I have always owned cars up to 10 years old. Never had to fork out for hefty repairs just the usual like timing belts, brakes, coil springs normal wear and tear. If I added up what I have spent in the last 10 years on my cars it is significantly less than the cost of PCP.

However we live in a society where everyone wants everything now. A friend of mine on the minimum wage working 16 hours has a 40k car Shock

GeorgeTheHamster · 13/10/2017 07:55

I bought nearly new from the main dealer. I intend to keep the car for 7/8 years. I'm pretty sure it will work out cheaper overall. It's only cost me servicing and new tyres so far.

ujerneyson · 13/10/2017 08:01

marble I think it depends if you're bothered about owning a car at the end. A lease means you simply give the car back at the end of the term, it's almost like a phone contract. We prwvipisly bought cars which were about 2 years old and kept them for about 4 years. We worked out that by that point we'd spent more than we would have done on lease payments over the same period of time and therefore it was more cost effective to lease. Having said that, when our eldest turns 17 we will buy a car for him to use as ours are not suitable for a 17 year old and as we are looking at a basic 1 litre run around we will buy a 5-7 year old car for cash. I'm that case leasing makes zero sense

SusanTheGentle · 13/10/2017 08:03

But Shelly I don't want a new BMW on the never never that I'm committed to replacing every few years. I looked at that purchase model when I was looking at a pricier car and it cost a daft amount of money on an ongoing basis. I ran A Lot of figures for different scenarios and concluded that I didn't want or need a fancy new car every three years, so I bought a better long term bet but a less fancy car for much less money (using a brand new pre reg which saved £3.5k.).

It might be the cheapest monthly way to get the most shiny car, but it's not a sensible financial decision long term, which is what was important to me. And that's what I was advising the OP.

That's also why the dealers are hell bent on getting people to do PCP deals too - it puts more of your money in their pocket.

But if you're happy with your choice and it got you the car you wanted for a price you were happy with then on glad you were able to get it.

MiaowTheCat · 13/10/2017 08:12

This reply has been deleted

Message withdrawn at poster's request.

MillicentFawcett · 13/10/2017 08:14

Well exactly Susan. Do people think PCP is about dealers being kind? Of course not. It's a huge cash cow for the dealers.

OnionShite · 13/10/2017 08:19

Lol @ missy.

19lottie82 · 13/10/2017 08:23

I bought brand new (10k) cash ten years ago. Never broken down, no big bills.

That's great, you've been very lucky.
Plenty of other people have had opposite experiences.

19lottie82 · 13/10/2017 08:29

But Shelly I don't want a new BMW on the never never that I'm committed to replacing every few years......

But a lot of people do, and Shelly is pointing out that is they do then PCP is the most financially sensible way to get the car, in this situation.

Of course you can get cheaper, but when people buy houses, they could usually buy a cheaper (and smaller / less comfortable) one too, couldn't they?

The same could be applied to clothes, food, holidays, the list is endless.

It's all about priorities. And just because someone wants a nice car, doesn't make them an idiot. Not everyone wants to drive around in a sub £5k car. Different strokes for different folks.

PinkSparklyPussyCat · 13/10/2017 08:41

I have my car on PCP and it works out better for me as I want to change my car regularly. I also like knowing my car is under warranty for the duration. I've driven older cars and spent loads on them so it made sense for me to get this one on PCP - it doesn't bother me that I'll never own it.

Sunshinegirl82 · 13/10/2017 08:48

Susan, again with the "it's not a sensible financial decision". Do you know how patronising that sounds? For some people, it is a perfectly sensible financial decision.

PCP offers an almost fixed cost, relatively low risk option for buying a car. For people on a budget who require reliability it is worth paying a bit extra for those benefits.

Obviously if you have the cash burning a hole in your pocket then great, buy it outright for cash. But most people will buy with some sort of finance, getting a loan is obviously still a finance arrangement of sorts.

If you buy a 5 year old car with a loan then you might be lucky and pay only your loan repayments for the duration of the loan, own the car and pay for only minor additional maintenance. Great result. Or you might end up paying off the loan whilst paying for a series of expensive repairs and dealing with having your car out of action for a period of time. Doesn't mean it's not a valid choice to buy a car in this way just that there are some risks that would be deal breakers for some people and not for others.

PCP or leasing essentially buys off that risk. I'm not saying it is the cheapest option possible, it isn't. But that doesn't mean it doesn't offer value for certain people in certain circumstances.

Gemma191 · 13/10/2017 08:52

Currently both our cars are 10 and 9 years old! We will have to think about replacing them soon.

I'm not opposed to PCP, however the 'hook' offers I've looked at have very low annual mileage allowances. 6-8000 miles per year is nowhere near enough. The when you start to add extra miles on, the price bumps up massively.

I love the idea of a new car but the thought of the huge monthly cost makes be nervous...

Namethecat · 13/10/2017 09:00

My OH drives approx 17000 - 19000 miles a year. About 4 years ago he saw a ' bargain ' advertised on a notice board at work. He still has that car,never let him down,yes it's failed MOTs but goes through with a bit of work .That car cost him £500 !

19lottie82 · 13/10/2017 09:06

Name yes but there's absolutely that will be the case with everyone that buys a used car, it's no good using that as a comparison.

MillicentFawcett · 13/10/2017 09:08

The issue with PCP is that if you lose your job then you are absolutely fucked. And that's fine if you're happy to take that risk. I would for a roof over my head. For a car? Not a chance

Orangebird69 · 13/10/2017 09:27

Dh and I don't like credit/monthly payments ... we could afford to pay for a new car without a loan but I hate the depreciation that happens as soon as it's off the forecourt. So we buy fairly old but good/high spec cars for cash and keep them until they die. I currently have a 9yo FL2. Lovely interior, bells and whistles, beautiful sparkly paint and so far, a year of v pleasant trouble free motoring. Somehow, even though I'm a sahm, I still manage to clock up 15k miles a year (Shock I have no idea how tbh), so leasing wouldn't work for me. My car is mine, all mine, and I love it although I am currently trying to convince dh that I need a Disco 4. The boot is too small on my FL2.

ShellyBoobs · 13/10/2017 09:27

SusanTheGentle you have clearly got no idea what you're talking about with your 'on the never, never' rubbish.

You've also changed your story from 'not financially sensible' to 'I don't want that car'.

If someone wants to buy that BMW I mentioned, and own it OUTRIGHT, not replace it after 3 years, etc, etc, the cheapest, CHEAPEST way to own that car is to use the PCP offer.

A cash buyer will pay more for that car. FACT.

If you are sat there with £30k or so burning a hole in your pocket and want THAT car, the cheapest possible way to buy it is to take the PCP deal. You can clear the finance without any penalty at any time you like and still take the extra £5k+ of discount.

Even without paying it off early at 1.9% APR you are still MASSIVELY better off not paying cash for it.

There are no two ways about it. That's not wishful thinking, it's fact.

SquashedInTight · 13/10/2017 09:29

Depends how new you want it to be. We buy at 8 years old, low mileage, well cared for and keep until 12 years old, costs us about £500 a year plus we budget £400 a year for MOT and repairs. Once it starts going over that, we get rid. So £75 a month all in. We do lots of mileage though so well over 10k and just want a car that runs, that can be repaired easily and has a good record for being reliable into old age - not bothered about too many bells and whistles. In my experience of newer cars, the more fancy stuff there is, the more there is to break!!

MillicentFawcett · 13/10/2017 09:37

This is a good article: www.ft.com/content/0e651206-0ee1-11e7-a88c-50ba212dce4d?mhq5j=e5

SusanTheGentle · 13/10/2017 09:49

Jesus christ. We are arguing at cross purposes here. Are you working in the industry or something? You seem determined to not listen to what I'm saying. I'm not talking about a specific car, I'm talking about long term VS short term, and whether you are willing to compromise on the type of car or how long you keep the car for.

If your aim is to get the bestest shiniest car for a low monthly payment and then continue to get new cars then yes, PCP makes sense. If you want a low cost option over the long term and don't want to continually change cars, WHICH IS WHAT THE OP WAS ACTUALLY ASKING ABOUT, then PCP is daft.

SusanTheGentle · 13/10/2017 09:50

Oh and I don't want that car because for me and frankly for most people buying a brand new BMW is not financially sensible - they are the same thing.

SusanTheGentle · 13/10/2017 09:52

Sunshinegirl82 nut I literally said that up thread. That's why my SIL has a leased car.

MillicentFawcett · 13/10/2017 10:10

This is the bit you're overlooking Shelly:
The car is owned by BMW Financial Services until all payments are made then it becomes yours.

It may be the cheapest way to get a new car but it doesn't belong to you unless you make every single payment on time in full. That's a fact.

problembottom · 13/10/2017 10:31

Well PCP means I have a much nicer car - worth £35k compared to the £15k I paid outright last time. Cars don't excite me but I do a lot of motorway driving in my job and spend a lot of time sitting in the car too so for me it's well worth it. It's well within my means and if I lost my job tomorrow I'd be fine to keep up the payments. It's certainly not right for everyone but I don't think you should dismiss it for all...