Lease / contract deals anyone?

[Monstera]

My old banger is at the garage today and I'm not sure it's going to make it out again. I have the option to go out and spend up to £3k on a new car if necessary (interest free credit card) but I'm considering going for a lease deal instead.

I do about 12,000 miles a year and need a reliable car for work. I don't need anything big and I don't care what colour / shape / paint finish it is.

I'm looking at the Peugeot Just Add Fuel deal and Ford Options. I don't really care if I drive a new car or not, but I like the idea of no unexpected bills cropping up.

Does anyone have any experience of these deals and do they work out cheaper in the long run or not?

Definitely no cheaper in the long run - you're effectively paying for the depreciation on the car, plus the finance company's profit (although there are big discounts so the manufacturers can shift cars).

You don't own the car at the end (unless it's PCP/Hire Purchase/Lease Purchase and you pay the balloon payment at the end) - you hand it back and either buy or lease another car.

If you want a new car, and especially if you want to change every three years or so then it's great, with all the benefits of a new car - picking the colour/options, knowing the history and no one else has farted in it and thrashed it from cold (and the other benefits of 'Just Add Fuel' deals), and having a fixed monthly outgoing.

Downside is if your circumstances change: cancelling an agreement can be expensive (PCP is probably the best from this point of view), your mileage significantly increases (excess mileage charges are usually ridiculous); companies taking the piss on marks/dents/scratches when you hand the car back, and as before, it's not cheaper, it's just structured to sound that way.

If you go secondhand and want to guard against repair bills, put the money that would go on finance payments in an account to use for maintenance/repair - it's exactly the same as (and likely financially better) than that same amount going on the car rental each month.

Thanks WM that's really helpful. I think when you get to the end of a life of a car it feels like there are constant unexpected bills, but really I suppose you have to average it out over the life of the car. I've had mine 6 years and it was 2 yrs old when I got it so it has definitely been miles cheaper over the 6 years than paying out on a lease car would have been.

Anyway the car came back tonight and seems to be running OK again so maybe it'll limp on a few more months.

Could you go to Available car they let you pay over 4 years and you get to keep the car.
Just a suggestion.