UKC

Hi all,

Some car-related pondering...

I currently drive an 11 year old Focus estate that I bought 4.5 years ago. It seems to have had all sorts go wrong, and today it's in to have a lot of work done on the brakes, with a correspondingly frightening bill.

We're thinking it'll be time to change it/get rid around MOT time next February - our choices are to buy another car, perhaps spending a bit more than my usual £2.5k (say up to £5k), but we're also considering leasing.

I only do around 6,000 miles a year, my car is very much the 'second car' (Mr TC has a big Volvo that we use for anything other than local tootlings, and he uses it most days for driving all over for his work), and it's generally only me and the dog (or me and my mountain bike) in my car, so something more Fiesta-sized would be absolutely fine. We live close to a town, but we're still in a village, and the work I do means that it's useful for me to have a car. Leasing would be good in that it would ensure any nasty mechanical surprises were sorted, but it would mean I might be more cautious about what I put into the car (i.e. dog/mountain bike).

Do any UKCers lease a car privately? Have any of you found yourselves in this situation and plumped for either buying or leasing and can explain why you chose what you did?

In reply to Tall Clare:

Frightening bill? Focus brakes are easy - I had one for about 8 years.

Anyway, I think it's replacement is on one of these lease deals - I will pay it off in a couple of years, but at the moment I'm getting free servicing which is worth more than the 4% interest.

So far, we have only put about 6k miles on it since November, as we use my wife's company car for most things and an office move meant I'm cycling/motorbiking to work a lot now.

Being a lease car hasn't put me off putting bikes in it, fitting roof bars or chucking surfing stuff and a pram in the boot - you have to live with it, just be careful with it and treat it as if it's your car anyway.

In reply to LastBoyScout:

This is front brake pipes, brake fluid replacement, rear brake shoes, drums, cylinders, wheel bearings, bleed nipples, and some ABS issue...

The fixed cost aspect of leasing feels very attractive at the moment.

In reply to Tall Clare:

The lease will probably cost you half the price of a new car, then you will have to get another or pay for the rest. So not a good idea imo.

In reply to Tall Clare:


Wheel bearings on a Focus are a pain - you need a 25 ton press to replace them. Local Ford garage mucked up replacing the NSF one to such an extent that the wheel nearly fell off and then, when it nearly did it a second time, said it wasn't their fault that it needed several other new parts!

Anyway, rear brakes aren't hard or expensive to replace - you'll mainly be paying labour. The pipes and ABS might be trickier.

In reply to Tall Clare:

I have considered leasing but never actually done it. I have only really bought 3 cars since 2001. I got a £6k loan for a 3 year old Astra in 2001. It gave me 8 years of cheap motoring. I then gave it to my wife who drove it for another two or three years and got another loan for £10k and bought a 6 month old fancy Astra. 3 years later the family arrived and I swapped it in for a Focus estate (same age). We have had that for four years and I reckon it has another 3 - 5 years in it.

So that basically works out at £1k a year although in reality, once the loan is paid off, you get motoring for free.

So my advice is buy a three year old car that hasn't been ragged and has full service history. Then keep on top of the maintenance so that you don't get hit with an OMG bill.

Leasing doesn't make sense unless you are happy to continuously pay for the privilege of driving a brand new car all the time.

In reply to Tall Clare:

Been looking in to it myself, lease deals only really offers value when compared to buying a new car. Not bought yet, but decided I could not justify buying or leasing a new car and will be buying something a couple of years old.

In reply to ByEek:

I've never had a new car so that's not a motivation - buying new isn't really what makes sense for me. I'm self employed so it could be a business expense but even so... My last car was a Fiesta that cost £2.5k (I think it was eight years old when I got it) and it ran pretty much brilliantly for six years. This Focus has been the opposite...

I get my car serviced once a year - it shouldn't really need more for 6,000 miles a year. I just think this one is vengeance for the Fiesta being so straightforward

In reply to Tall Clare:
True - I guess that is the luck of the draw. Having always bought 3 year old cars, some of the risk is taken away because it is pretty hard for things to go seriously wrong in that time.

I must admit that I have found our Ford Focus pretty expensive to maintain compared to the Astra and I won't bother with a diesel car again especially as our milage is also pretty low.

In reply to Tall Clare:

I've never been too convinced on leasing. Seems a good way to puff people into a new car at a fee that wouldn't buy them a new car. But if you don't want or need a new car you can do it cheaper elsewhere. Another post describes pretty much what I have done...
Buy a newish car and keep and keep as long as sensible while saving a bit... buy a newer one and keep as long as possible and repeat.
I have eventually got to stage of having enough savings to spend 10 to 15k on a sensible size car every 10 years or so. No interest paid (int received in fact) and car is mine so no worries if it does get dinged/worn etc.
The maths for me is pretty much (we do this for a big car and a sensible car, so for sensible one).
Spend 10 to 15k on something reasonable, low mileage, nearly new, mid spec, mid engine, loads around so plenty to choose from and good haggling possibilities... say a golf, an astra, a focus, an Alfa Guilleta or whatever. Take your pick. Best picking something that depreciates like crazy (rules the Golf out but hey, I've always wanted one after years of fords and Vauxhalls) as you want it as cheap as possible at 6 to 18 months old as you will keep it until its a banger so final value is meaningless to you. As you do small mileage you could also consider a 1 year old with say 30k on it - likelihood is that its been a rep car and 30k of motorway mileage plus servicing will make it pretty unworn in all reality and it'll still have plenty of warrant. If you pick a Kia or a Hyundai they have long warranties (5 and 7 years I think).

Save £100 per month and in 10 years you have £12k plus interest to replace car with. Plus a few hundred for selling/trading your existing one. On my golf I budget £85 per month to cover servicing/replacement parts/insurance/tax and AA cover (doing say 10k per year). That means it costs me £185 per month to own the vehicle, if I can get around 10 years out of it..... If you can lease and run one for less, happy days but I doubt it. Leasing tends not to cover running costs, they are on top (although tend to be lower as you probably only need a service or two and perhaps some tyres before handing back). If I have huge mechanical disaster, I can dip into the replacement fund to tide me over but in reality, buying nearly new, the £85 per month running costs are ample and a surplus builds up in first few years that will probably then be eaten into in second half of cars life as it gets older and more worn.

In my experience over the years, I have done better buying cheap bangers and running a year or two or buying nearly new and keeping a long time than I ever did spending £4 to £7k on 3 to 6 year old cars... those ones are tricky as they are new enough to be too good to bin but old enough to possibly have issues you can't spot straight away and are already drifting out of the sailing through MOTs and Servicing with nothing extra required stage.

Bear in mind with leasing they will want the car back in a fair condition for its age so if you have a run of bad luck with people dinging you/scratches/dog/bike damage etc, you may get hit with rectification charges. On your own car you simply shrug and put up or get repaired as you see fit. And if keeping to 10 years old a few trolley scrapes/dings etc are neither here nor there. Its also easier to justify roof racks/bike carriers etc as you know you will get many years use out of any extras or accessories you obtain.

In reply to Tall Clare:
There may be a nice 57 plate Honda Civet coming to the market soon. One careful midget ginger owner. In good nick and with a tow bar (for the bikes).

I can put in a good word and she might leave you a bag of Haribo and patch up the stiletto marks in the roof lining.

In reply to Tall Clare:


Any? Check the T&Cs. Supposedly, if you are worried about unpredictable maintenance costs, 3rd party service/warranty deals are better value for money than the ones dealers flog to clueless new car buyers...?

In reply to Tall Clare:

Always remember to get gap insurance for a lease car with a balloon payment - if you write it off you will get the current value of the car not the invoiced amount so you could end up owing a large chunk to the finance company. For gap insurance avoid the sales pitch at the garage Mrs C just got an Evoque and landrover offered gap insurance at £499, I looked on-line and got the same cover for £150 - also check your main insurance policy, some offer two years gap insurance included in the main policy.

As a general rule I was told by a commercial manager type that you should always avoid buying a depreciating asset (i.e. a car) - say you spend £35,000 on a new car it will generally lose 50% of its value in three years so you've spent £17,500 - if you get a lease car and can put a reasonable deposit (£12,000)- you can get that lease car for £200 a month so £2,400 p.a. so you spend £7,400 over three years if you've'd looked after the car you can exchange it for a new car - spend a futher £7,400 over the next three years - you never own the car outright ... personnaly I don't care about that - Mrs C gets a new car every three years, warranty cover, servicing and roadside assistance included - she's happy and can pay the £200 a month herself. I'm happy because she's not driving an old banger.

Also when asked how many miles you do - do for a low annual mileage - it's cheaper to pay the excess mileage charges than theuplifted monthly payments a higher mileage costs.

In reply to Tall Clare:

I was pretty much in the same boat as you last year.

My boss made me think about leasing as that what he did after losing 19 grand in 2 years buying and selling a nearly new merc.

He now leases a big bmw as he reckons it's a better deal for him.

I didn't and don't have his type of cash so was looking at mid range cars.

I ended up buying a car from one of these motor supermarkets getting a loan from the bank for the extra 4 grand I needed to get the car I wanted.

Leasing a mid range cars just didn't seem attractive at all when I totted everything up at the time. To me it would only make sense on the big wee whoo expensive cars.

Good luck

cheers

Gaz

In reply to Tall Clare:

I have looked at leasing a few times but the deals never look good enough for me to take the plunge. I had a work van provided for the last few years but recently gone self employed and looked into buying a newish car/van or leasing something. I ended up getting a well looked after £300 mk3 astra... We do have a nice car if we go anywhere but must admit having an old car is great I don't worry parking a anywhere and money wise it made sense. Pretty simple to work on so I keep a little fund for repairs and figure come MOT I'll see if it survives.

In reply to Tall Clare:

Adding to the chorus. After the money pit VW Polo Saloon, and again now with Humphrey, I have looked into it. It just doesn't make financial sense for me. Others have gone into all the ins and outs already so I won't try to add to that.

In reply to John Rushby:



I would actually pay more for a car with some of those.

In reply to Tall Clare:

I am presently in a winter tyres / XKR /F Type conundrum*


*I have no children.

In reply to John Rushby:


Does it shit expensive coffee beans? Or is that a different midget mammal?

In reply to cander:

I think its more a case of 'don't BORROW' money to buy a depreciating asset. And keep that asset as long as possible to mitigate effects of depreciation being far steeper in first few years than last few.....

I don't follow your figures. Surely the deposit put down is largely lost come vehicle return time and should be included in your monthly costs? i.e. if a car is worth £35k new and worth £20k when handed back 3 years later, what the garage/finance company need from you is £15k.... they take that in the form of £200 per month for 36 months which is 7,200, they also take a deposit of £7800 making £15,000 you have paid. At end of 3 years broadly speaking you hand car back and walk away or buy it for the agreed return value of £20k. Whether that makes sense depends if you want to buy it and whether the return value is higher or lower than you could buy a 3 year old same car at a dealer.

On your example you pay £7400 and £12,000 which is £19,400 or £540 per month. Unless you actually get deposit back in full, in which case I have totally got wrong end of stick.

They make their money as they can borrow to finance your leasing cheaper than you can, and obtain bulk discount so don't actually pay £35k for the car.... The deal is usually structured so that you come out with some surplus ('equity') towards your next deposit to keep you hooked into the scheme. People I know who have gone onto leasing have invariable ended up with ever increasing costs or ever 'worse' (smaller/or more basic) cars as the initially attractive looking deals generally didn't yield as much equity as expected, leaving less in pot to refinance next time round.

I think leasing makes sense to those who are happy paying a large monthly cost to have hassle free motoring and a new car every 2 or 3 years, without ever actually having to come up with the starting cost of a brand new car to start the ball rolling. It lets you get that new car on smaller monthly payments than if you simply tried to borrow £35k over 3, 5 or even 7years. None of that sounds terribly like how the OP currently runs her cars.

Thanks all, some really interesting thoughts here. I don't have to make any decisions for the time being - and I certainly intend to get my money's worth out of this latest repair bill! - but it's most likely that I'll be continuing my 'elderly car' path, perhaps just a bit newer than previously...

In reply to Tall Clare:

Leasing makes no sense in your position.

The most economical way to get a reliable car is to buy a model known for its reliability and one that someone else has already taken the depreciation 'hit' on it.

Think about a 2 year old Honda Civic (or Jazz). The petrol model will do as you're not high milage. Then your motoring will be cheap and trouble free for the next 12 - 15 years. Sorted.

In reply to Tall Clare:

if you want a new car get an ex-demo. There are always cracking deals around ( look at some of the volvo ones). Helps avoid the depreciation issues.Usually you can package in servicing for 3 years, and negotiate. leasing can be viable but bear in mind upfront costs/deposits and costs when the deal finished. Make sure you understand it.Certainly for low mileage it can be well worth it. I always take the view that somebody somewhere wants to do a deal as they need to shift a car that week to meet a target.

In reply to neilh:

But *don't* buy an ex-demo if the garage it is from is in an area with lots of speed bumps. That is a recipe for steering problems.

Neil

In reply to Neil Williams:

I know you mentioned that issue on a prior thread. I do wonder (having driven new cars, bangers and run cars for long durations myself) how much of the issue you had was really down to speed bumps and bad driving for a few (low thousands) of miles? If I bought a demo with say 3 to 6k miles on it, and it had 'steering problems' caused by getting a bit of a thrashing every now and again by salesmen, delivery lads, test drive rocket pilots etc I'd be more inclined to question the fragility of the car itself than anything else and to be suggesting that it isn't or merchantable quality! If a car can be bust that easily there's no hope of it lasting.

I drive over plenty speed bumps, I drive fast where I can, I carry heavy loads, I drive car miles up and down farm tracks and unmade roads, and I generally keep my cars multi years and have never had issues with wheels, steering or even shocks.... And that's on tens of thousands of miles. How much damage can really be done within a proportion of the small number of miles on a demo?

In reply to Ferret:

Do you buy premium cars, though? The effect on those may well be far less than on cheaper cars - this one was my first vehicle and while pretty much new was right down the bottom end of the market.

Neil

In reply to Jim Lancs:

I did this more or less - Toyota not Honda though

In reply to Tall Clare:

Nothing to do with leasing (I do, but via Ford Options so not what you're looking for) but another big Up for the Fiesta. I have had a stream of them for the last 15 years and they are reliable and cheap to run/maintain and, when in an accident at 80 mph, it provided brilliant protection.

In reply to Neil Williams:

Nah - afraid not, although not utter bargain basement. Newer stuff I've owned and kept a while has been Fiat, Alfa (both notoriously fragile but didn't seem to be an issue), Vauxhalls etc. Plus I've also had (over a long history) a properly old Sierra I had into its teens (owned by me for a long time) plus teenage Hondas, Vauxhalls and Alfas that either I had a long time or I had 2 or 3 years at the end of their lifes.

Interesting - I guess if you are talking total tin can its a possible but hey, if its nearly new the rectification should be under warranty as they can hardly claim it to be fair wear and tear surely? I really am intrigued as I would be seriously worried if somebody admitted to me that a nearly new car wasn't capable of dealing with a few speed bumps for a few miles. What's it going to be like at end of 100,000 miles of careful or even 'normal' use?

In reply to Tall Clare:
My sister leases her car and has done so for a long time. She reckons it's great for the following reasons:

- Servicing, new consumable parts (tyres, exhausts), and road tax are all taken care of (obviously the level of care is specific to the contract)
- She doesn't buy the car off at the end of the lease period, she just rolls it over and gets a new car every 3 or 4 years, which given that she does quite high mileage for her work is good
- She can get a better car than she could afford to buy either new on credit, or second hand outright
- The people she leases off are really helpful - she has had early car upgrades several times, and recently after my niece was born when it became clear that their 6-month old 3-door car wasn't working for them, they swapped it for a 5-door version at no cost to her - obviously your mileage may vary with this one.

Her take on it is that it isn't a good method of buying a car outright, but if you don't care about actually owning the car and are willing to pay a set price per month indefinitely there are a lot of benefits.

Edited to add: she mostly leases Fiestas a Focuses (Foci?). I myself have never leased and although I haven't looked into it in much depth, I am not sure it would make financial sense for me either.

Leasing makes sense if you buy new or newish cars are are worried about depreciation, and you borrow the money to pay for the car anyway. You know up front what you're paying for the next 3 years.

If you either use savings or don't buy newish cars it won't be cheaper.

You can bundle in servicing a maintenance and only pay the average cost, rather than risk a large bill on the higher chance of a lower than average running cost. If the cost of not having a working car is substantial - eg self employed, then it might be cheaper that the chance of having to use taxis or hire car.