PCP or PCH car leasing?

[5 Hit Gibbon]

I'd rather smoke PCP than lease a car!

 

[bluesmith]

Thanks - presumably something I can do online, or something I'll need to phone or make contact with personally?

Try https://www.leaseloco.com/

 

[RobMCFC]

No comment on leasing here but I noticed that you mentioned Kia.

We use to change our car every 3 or 4 years ..... for the last 8.5 years, I’ve had a Kia Venga and my wife a Kia Picanto. They are both great cars.

Cars are so expensive these days that we are going to keep them as long as we can. So far, they’ve been very reliable, which I guess they have to be on a 7-year warranty.

Shame Kias are a lot more expensive now than when we bought them, but they are solid cars.

 

[somapop]

Try https://www.leaseloco.com/

Ahh - ok, I'll dive in - thanks for the link mate.

No comment on leasing here but I noticed that you mentioned Kia.

We use to change our car every 3 or 4 years ..... for the last 8.5 years, I’ve had a Kia Venga and my wife a Kia Picanto. They are both great cars.

Cars are so expensive these days that we are going to keep them as long as we can. So far, they’ve been very reliable, which I guess they have to be on a 7-year warranty.

Shame Kias are a lot more expensive now than when we bought them, but they are solid cars.

Yes. My brother has one on Switzerland and swears by them.
Definitely one on the list aside the VW.

 

[inbetween]

Anyone have a spare five mins over the next few days for a bit of help on this?

I'm at the point where I'm struggling a bit without a car (post separation/restarting in life).
The kids now live arounds 3 miles away and although I walk every where this isn't always an option. I've also started to (and wish to do far more) weekend trips.
My daughter struggles with anxieties (she's autistic) so can't get her on a train but there's so many more reasons I need a car.

Posted on the Electric Car thread that at the moment an EV isn't really an options (cost and I won't have home charging given I live in a flat).

Had a recent promotion at work (relatively new career so hoping these progressions continue) so have. bit of extra cash each month and absolutely believe having a car will solve so many problems and open up a bit of freedom for me.

With that in mind (and no real deposit) I was thinking of leasing but not 100% on which 'flavour'.
I have the VW T-roc in mind (and I feel the decision is part mind part heart...there's a fair bit to pay out for something you're not truly fond of).

I did stick a post about this on the main VW forum (volkswagonforum.co.uk) but complete tumble weed in terms of responses.
I might drop something on Honest John.

But if anyone doesn't mind PM'ing if they get a moment to help I'd be most grateful. I don't have a great history of cars so could do with a bit of ammo lest I don't get the best deal at the dealers.

Thanks!!

To be honest mate it totally depends on your financial situation. Without a deposit you might struggle with most options but I've done a run through of the different ones and my experience with them.

1) If you think your financial circumstances might change in the future then I'd be very careful about PCH (leasing) as it's a contract and you can't get out of it without buying yourself out. You pay a big deposit (usually 6-12 months up front), pay the monthly repayments and at the end you give the car back, you never own the car. It's often the cheapest way to get a new car because ownership isn't priced in so you're basically paying to borrow a car for a few years. With leasing you won't have to apply for finance and there's no interest to pay. Long term depreciation and road tax is also not your problem as you don't own the car.

2) PCP is similar to leasing but ownership is priced in. You pay a deposit which can be varied however lower deposits will increase your monthly repayments and add more interest to pay. At the end of the payment period you can pay a settlement figure to own the car outright, or you can give it back, or you can trade it in for something else, or you can sell it yourself. At this point it really depends on your situation, most people will trade their car in or sell it to get the equity out before the end of the agreement.

A good option is to look at approved used cars on PCP at local manufacturer dealers. You will pay a lot less than a brand new car and they won't be far off brand new (usually 1 previous owner, 1-3 years old, less than 10,000 miles). Dealers also often throw their ex test-drive cars onto approved used and these will be well looked after and have decent specs. I'd look at this route if you want a cheaper really nice, newish car and obviously don't mind it not being quite brand new.

The last option is to go for something from the likes of Cinch, Arnold Clark etc. They'll offer PCP and the cars can be cheaper than approved used car at dealerships but the cars often won't be as good. Cinch for example offers used cars that are traded in from other customers but the history is unknown and they could have damage and other problems. They should be upfront about these problems but you probably won't see the car before you buy it so it can be risky.

For me I've always done approved used from dealers on PCP. On my current car though I've leased because my finances are quite stable (I think!) and otherwise I couldn't afford the car brand new on PCP where it was miles more expensive.

 

[Uncle Wally One Ball]

Pay a big deposit, then rent it a big monthly fee, then give it back or start all over again. Has never ever made any sense to me why anyone does that but I get it must work for some people?

 

[bluesmith]

Pay a big deposit, then rent it a big monthly fee, then give it back or start all over again. Has never ever made any sense to me why anyone does that but I get it must work for some people?

It can work if you a comparing to buying a brand new car. As an example i leased a £45k car for 4 years for 15K including all maintenance, at the end of the lease the car was worth significantly less than £30k. If i'd bought the car I would have been much worse off. I actually bought the car for £12k off the lease company as the lease expiring coincided with covid and companies holding large stock of cars selling them off to generate cash. So ended up with a 45k car from new for 27k less all the maintenance costs.

 

[inbetween]

Pay a big deposit, then rent it a big monthly fee, then give it back or start all over again. Has never ever made any sense to me why anyone does that but I get it must work for some people?

Because it's miles cheaper than any other option.

The total cost of my lease for my new Tesla is £23k over 4 years but a new Tesla actually costs £45k. I'm saving over £20k by not owning the car. Indeed I have to give it back but then I'm onto the next one.

If you do HP/PCP then you will pay far more than the car is worth because of interest and depreciation. Once you eventually own the car it'll always be worth far less than you have already paid so it's not exactly an investment.

If you want to own then it only makes sense to pay cash and avoid paying interest but who is able to do that?

Would you buy a house that you know progressively becomes worth less over time? It'd make far more sense financially to rent and leave that problem to the owner.

 

[somapop]

To be honest mate it totally depends on your financial situation. Without a deposit you might struggle with most options but I've done a run through of the different ones and my experience with them.

1) If you think your financial circumstances might change in the future then I'd be very careful about PCH (leasing) as it's a contract and you can't get out of it without buying yourself out. You pay a big deposit (usually 6-12 months up front), pay the monthly repayments and at the end you give the car back, you never own the car. It's often the cheapest way to get a new car because ownership isn't priced in so you're basically paying to borrow a car for a few years. With leasing you won't have to apply for finance and there's no interest to pay. Long term depreciation and road tax is also not your problem as you don't own the car.

2) PCP is similar to leasing but ownership is priced in. You pay a deposit which can be varied however lower deposits will increase your monthly repayments and add more interest to pay. At the end of the payment period you can pay a settlement figure to own the car outright, or you can give it back, or you can trade it in for something else, or you can sell it yourself. At this point it really depends on your situation, most people will trade their car in or sell it to get the equity out before the end of the agreement.

A good option is to look at approved used cars on PCP at local manufacturer dealers. You will pay a lot less than a brand new car and they won't be far off brand new (usually 1 previous owner, 1-3 years old, less than 10,000 miles). Dealers also often throw their ex test-drive cars onto approved used and these will be well looked after and have decent specs. I'd look at this route if you want a cheaper really nice, newish car and obviously don't mind it not being quite brand new.

The last option is to go for something from the likes of Cinch, Arnold Clark etc. They'll offer PCP and the cars can be cheaper than approved used car at dealerships but the cars often won't be as good. Cinch for example offers used cars that are traded in from other customers but the history is unknown and they could have damage and other problems. They should be upfront about these problems but you probably won't see the car before you buy it so it can be risky.

For me I've always done approved used from dealers on PCP. On my current car though I've leased because my finances are quite stable (I think!) and otherwise I couldn't afford the car brand new on PCP where it was miles more expensive.

Was thinking along the dealership used line tbf and I feel it's my only option.

Not sure how that works without a deposit but I'll cross that bridge when I come to it.
I think my hesitancy is having a deal without comparison if I enter a forecourt.

I've mentioned the VW T - Roc a few times as I've had a great experience with a VW in the past, it gets decent reviews and I genuinely like it (that as to count for something).

Not that I want all the bells and whistles, but standard air con (after not having a working air con for years), DAB/Sat Nav are musts.

There's Kia and Hyundai's to look at.....but I keep gravitating towards the T- Roc.

So, not having the leverage of a broker in my back pocket (or significant car knowledge) and no family to rely on for advice.

 

[somapop]

Hi folks.
Apols for dragging this back up from the depths!

Was looking over this again this week. I asked a few Qs on a VW T-Roc forum which has helped.

Essentially it might be best to go via something like Car Wow (tend to have slightly better deals than dealerships apparently).
But it's probably best for me to take a trip to a VW dealer (there's a large one on Stockport perched on the M60).

I'm still not 100% sure on what kind of financing deal I should go for, but PCH looks like a good bet.

I have to admit I'm a little bit apprehensive about the visit to the dealership (hard sell etc). I've not owned a car for so long, I'm a little out of sorts with all this. But the important bit is I need a car now, but also want something it will be a pleasure to drive.

Case of just popping down with a bunch of questions, having a look at a few cars and options then taking it from there (do you have to schedule an appt or just rock up?)