Leasing a car with a view to purchasing it

[CaptainSensib1e]

Afternoon,

I am currently looking for a new car for my wife. As we have recently become new parents I'd like to get her what seems the be the 'mummymobile' of choice around these parts - a Kia Sportage.

I was initially thinking of buying a 2/3 year old one with a view to keeping it for 4/5 years, which would mean it would be under Kia's excellent 7 year warranty for the entire period of ownership.

However I took a look at the lease deals you can get on new ones and they seem very good value - essentially you can lease one for 4 years for under £200 per month.

So essentially you will be paying around £2k a year, which is about the same as you'd expect to lose in depreciation, so leasing seems like it could be a most cost effective option as well as meaning a big chunk of capital won't be tied up in a car.

However at the end of the lease there is a fair chance we'd want to buy the car to own for the remainder of the warranty period. I'd imagine the lease car company would be quite keen, as its a lot less hassle for them than taking the car back to sell on. However does any one have any idea of how much they would ask? In terms of could you reasonably expect a discount over similar cars? Are they usually open to a bit of negotiation?

I'd welcome any advice from someone who has done similar. Thanks

[Ste1987]

Why not just do a PCP, where you actually get the option to buy? Might be worth just asking before getting stuck in. I could be missing something here, it's just that, to me, the whole point of leasing is you get to change your car often without worrying about depreciation. PCP is a similar story, yet there is actually an option to buy at the end.

Edited by Ste1987 on Monday 29th June 15:33

[CaptainSensib1e]

With PCP, you normally have to put down a largish chunk of cash, so the aggregate cost is a lot higher. In essence, PCP just seems like a more expensive way to lease a car.

[Ste1987]

CaptainSensib1e said:

With PCP, you normally have to put down a largish chunk of cash, so the aggregate cost is a lot higher. In essence, PCP just seems like a more expensive way to lease a car.

Not necessarily, unless it's different when buying brand new? My understanding of PCP is you can put down as much deposit as you want to keep payments down, but the way it's structured there really is no point. With contract hire, which I think is what you're looking at, you have to put down a deposit that's equivilant to, for example, 3 months rent.

[bobclayton]

Most PCP's can actually be done at £0 deposit, it's just advertised with a deposit to make an attractive payment!
Worth an ask when you speak to them.

[anonymous-user]

Don't assume you'll be able to buy the car at the end of the lease, it's not always the case. Before taking the lease out ask if it's a possibility or not.

[Jonno02]

My current car would have been along the lines of £240 a month to lease. On PCP I got it for £160 with a deposit of a 1.4 '05 corsa. I know that I'm the exception to the rule though.

I shall be going down the lease route next time though.

[Roo]

charltjr said:

Don't assume you'll be able to buy the car at the end of the lease, it's not always the case. Before taking the lease out ask if it's a possibility or not.

This. Most lease companies have a disposal policy which won't be offered to you.

[sjg]

Drivethedeal are usually good for checking current finance deals and any stipulations around term, deposit, etc.

"The quoted prices on ALL MODELS. (except `1` and 'KX-1' models) include a £600 discount which is conditional upon you taking out PCP finance at 4.9% APR Representative over 36 months with a minimum deposit of 10% arranged by the dealer."

[CaptainSensib1e]

Thanks for all the comments, I'll check out drive the deal as that would seem like the cheapest way to get a PCP deal.

[nickfrog]

At £200/month, what's the deposit on the Kia ?

[GreatGranny]

nickfrog said:

At £200/month, what's the deposit on the Kia ?

I was going to ask this.

Seems a low monthly amount.

Had a quick look and the CRD1 with free metallic paint is £200 pcm on a 3+47.

OP - Why not just take out another lease deal rather than purchasing?

[Ste1987]

GreatGranny said:

I was going to ask this.

Seems a low monthly amount.

Had a quick look and the CRD1 with free metallic paint is £200 pcm on a 3+47.

OP - Why not just take out another lease deal rather than purchasing?

I was wondering the same. Why not just lease another brand new Sportage at the end?

[400SE Dave]

We did this with our XC90. We leased it for 3 years and then bought it at the end - mainly due to the wife not finding anything else other than another XC90 that she would replace it with and with a new model due it would have been silly to go for another 3 years on a role out model.

The price we paid added to the lease payments we had made basically meant we paid no interest on buying the car. From what I hear this seems to work with bigger cars and SUV's.

We did check out a PCP before doing the deal and it worked out more expensive by £120/month.

[talksthetorque]

Ste1987 said:

GreatGranny said:

I was going to ask this.

Seems a low monthly amount.

Had a quick look and the CRD1 with free metallic paint is £200 pcm on a 3+47.

OP - Why not just take out another lease deal rather than purchasing?

I was wondering the same. Why not just lease another brand new Sportage at the end?

^^^^^^^^^^^^^^^^^^^^^
This.

And the one above that
At the end of the lease you will be asking yourself exactly the same question you are asking now.
Do I buy a 4 year old car, or do I lease a new one?
The only thing is in 4 years, it will heave 4 years of your driving in it instead of your second hand purchase now, which has four years of someone elses.