Selling car for mortgage deposit and getting a lease?

[Qnc838]

Would this be madness or a good idea?

I’m thinking I could sell my car, get about £6k for it which would go on my deposit. I’d then get a two year lease car, once this finishes I’d buy my own car again.

Is there a pitfall I can’t see?

The monthly repayments on the lease could well lower the amount of mortgage you could get. It would be worth speaking to a mortgage advisor to see how much of a difference it would make to what you can borrow.

The car lease would affect how much you could borrow.

You’d need the initial deposit for the car lease, which would eat some of it up.

£6K isn’t a huge amount - how quickly could you save that up if you compare it to a car lease monthly payment e.g. if you can afford £250 a month on the car you’d have save up £6K in 2 years anyway...

Oh do you have to put a deposit down on car leases? I thought it was just the monthly payment?

Ok this is a daft idea then!!

Some PCPs don't need much of a deposit. I got a Skoda Citigo with only one month deposit, which was only £130 anyway.

But the monthly payments could affect affordability, which may or may not be an issue. Could you just buy a much cheaper car and run that for a couple of years? Eg a small car under £1k would release £5k into your deposit savings.