buying help with finances plus also buy vs. lease X3

[ITR1]

I'm not sure how to go about next car purchase so thought I'd ask strangers on the interweb for some help
I need a new family wagon and really like the look of the latest X3 which i think sneaks onto a 17 plate. A few reviews suggest the 2.0 is a bit underwhelming so thinking of a 3.0d which looks to be a good mix of torque and economy.
I've leased for 5 years and so am used to budgeting for around £300 pm. AUC cars look to be around £28k or so which i could pay for outright but I'd prefer to hold on to cash at the moment.
I am not sure if I am going about this the right way. Options i think are:
1. buy a used one for around £28k, using £13k cash and £15k loan (keeping car for 4 years clears the loan after 48 months - well, within £600 plus interest) which will hopefully leave me with a car still worth £10k-£14k which I can then either trade in an repeat or sell or keep.
2. stick with leasing, but for a 3.0 it will cost around £27k i.e. the cost of a used new shape (seems daft)
3. use more or less cash to buy the car and increase/decrease the loan size.
4. Not use a loan and buy an F version X3 instead or somethings else for £15 - £20k.

I have considered some other cars, like a 330 estate or 340i and they are similarly priced so above still applies.
Any guidance gratefully received. Thanks.

[covmutley]

Not sure there is a right answer, but I'd ho option 1.

Facelift 2017 plate will be nicer, but still done the worst bit of depreciation.

[ZX10R NIN]

Go with option 1 but with a little twist, if you take BMW finance when they're adding a contribution to the car as well as 1 or 2 free services you can save more money & then you take the loan out to clear the finance.

[kiethton]

Agree with the above - its how we do our dailies: get a 3-5 year old car and run it for 3-5 years - best balance of reliability/modernity/depreciation in my view

[Tall_Blk]

Unless you need the cash for emergencies, I’ll go option 3. The only exception is if the cash is yielding a good return as interest rates on savings at the moment is none existence.

[Pistonheader101]

Honestly I'd use option 4. Live within your means. Don't be taking out loans for a car when you can get a perfectly good car for 15k or less.

[J1990]

Pistonheader101 said:

Honestly I'd use option 4. Live within your means. Don't be taking out loans for a car when you can get a perfectly good car for 15k or less.

That's a fine opinion to have and I agree it's often better financially to do this... But if they can afford the repayments then it is within their means and each to their own as to how people choose to spend their money.

[ITR1]

ZX10R NIN said:

Go with option 1 but with a little twist, if you take BMW finance when they're adding a contribution to the car as well as 1 or 2 free services you can save more money & then you take the loan out to clear the finance.

Ah I see, so go AUC, they throw in some money on the basis that I take their finance, and then just pay it off pretty much straight away? I didn't know if BMW usually make a dealer contrib on AUC but I'll look into it. Thanks.

[ITR1]

kiethton said:

Agree with the above - its how we do our dailies: get a 3-5 year old car and run it for 3-5 years - best balance of reliability/modernity/depreciation in my view

Its what I keep coming back to, I think once you've made the initial outlay you use the car as the payment in to the next vehicle in 4 years time and just get another loan. I wasn't sure if I was missing anything!

[ITR1]

Tall_Blk said:

Unless you need the cash for emergencies, I’ll go option 3. The only exception is if the cash is yielding a good return as interest rates on savings at the moment is none existence.

Returns minimal but I like the comfort blanket of having some instantly accessible!

[ITR1]

Pistonheader101 said:

Honestly I'd use option 4. Live within your means. Don't be taking out loans for a car when you can get a perfectly good car for 15k or less.

I get where you are coming from but I dont see it as an affordability issue as such as I can afford the car outright (so I'd have the loan equivelent in cash, and a bit more). Its more about should I go down the loan route at all as I see it as an ongoing monthly cost, effectively self- underwritten. I'm used to paying that cost.

It is probably a decision only I can make, but I wondered if others take a similar approach. i like the idea of looking out for dealer contribution on finance and then paying it off with a cheaper loan. I hadn't thought of that.

[Challo]

ITR1 said:

I'm not sure how to go about next car purchase so thought I'd ask strangers on the interweb for some help
I need a new family wagon and really like the look of the latest X3 which i think sneaks onto a 17 plate. A few reviews suggest the 2.0 is a bit underwhelming so thinking of a 3.0d which looks to be a good mix of torque and economy.
I've leased for 5 years and so am used to budgeting for around £300 pm. AUC cars look to be around £28k or so which i could pay for outright but I'd prefer to hold on to cash at the moment.
I am not sure if I am going about this the right way. Options i think are:
1. buy a used one for around £28k, using £13k cash and £15k loan (keeping car for 4 years clears the loan after 48 months - well, within £600 plus interest) which will hopefully leave me with a car still worth £10k-£14k which I can then either trade in an repeat or sell or keep.
2. stick with leasing, but for a 3.0 it will cost around £27k i.e. the cost of a used new shape (seems daft)
3. use more or less cash to buy the car and increase/decrease the loan size.
4. Not use a loan and buy an F version X3 instead or somethings else for £15 - £20k.

I have considered some other cars, like a 330 estate or 340i and they are similarly priced so above still applies.
Any guidance gratefully received. Thanks.

I wont comment on the finance piece, but in terms of the car dont rule out the 2.0d. Yes is lowered powered compared to the 3.0d. We had that version and while a little sluggish off the line, its perfectly fine for the majority of family requirements.

[Scootersp]

ITR1 said:

I get where you are coming from but I don't see it as an affordability issue as such as I can afford the car outright (so I'd have the loan equivelent in cash, and a bit more). Its more about should I go down the loan route at all as I see it as an ongoing monthly cost, effectively self- underwritten. I'm used to paying that cost.

It is probably a decision only I can make, but I wondered if others take a similar approach. i like the idea of looking out for dealer contribution on finance and then paying it off with a cheaper loan. I hadn't thought of that.

I'd look at what personal loans you can secure, look at the total payable for the loan range and so work out your cost to finance ie additional cost over just paying in cash. At the moment it's likely to be pretty low and I'd say it's worth having the cash buffer and loan. You seem sensible and so the cash will sit there or be invested etc and not spent.

Cash gives you options and credit I think may become harder to get in the future while currently being as cheap as it ever has been to use. If you are used to £300 then just use a loan calculator to see what x years of that will let you borrow then top up with cash.

Very roughly 3 years of £300 per month gets you £10K and only about £200 per year for the not using the £10k of your cash from the start......it's not a great deal to pay for the flexibility it gives you.

[ITR1]

Scootersp said:

I'd look at what personal loans you can secure, look at the total payable for the loan range and so work out your cost to finance ie additional cost over just paying in cash. At the moment it's likely to be pretty low and I'd say it's worth having the cash buffer and loan. You seem sensible and so the cash will sit there or be invested etc and not spent.

Cash gives you options and credit I think may become harder to get in the future while currently being as cheap as it ever has been to use. If you are used to £300 then just use a loan calculator to see what x years of that will let you borrow then top up with cash.

Very roughly 3 years of £300 per month gets you £10K and only about £200 per year for the not using the £10k of your cash from the start......it's not a great deal to pay for the flexibility it gives you.

Thanks, yes this is reinforces what I was thinking. Debt is currently cheap. We'd keep the car for 4 years.

[ITR1]

Challo said:

I wont comment on the finance piece, but in terms of the car dont rule out the 2.0d. Yes is lowered powered compared to the 3.0d. We had that version and while a little sluggish off the line, its perfectly fine for the majority of family requirements.

Thank you, I'll certainly test drive one when I can. Tbf I read a reivew last night which said the 2.0d is hard to overlook esp if you have the acoustic glass to drown out any noise it makes !

[Jamescrs]

I'm not sure BMW will throw in incentives to take their finance on AUC's, they didn't with me when I bought a M240i off them in September and I told them I was looking at a personal loan to finance the car, they asked me what the APR was on the loan (2.9%) and that was the end of the conversation really.

[ITR1]

Jamescrs said:

I'm not sure BMW will throw in incentives to take their finance on AUC's, they didn't with me when I bought a M240i off them in September and I told them I was looking at a personal loan to finance the car, they asked me what the APR was on the loan (2.9%) and that was the end of the conversation really.

What finance rate were BMW offering out of interest (no pun heh heh).

[Pistonheader101]

ITR1 said:

Jamescrs said:

I'm not sure BMW will throw in incentives to take their finance on AUC's, they didn't with me when I bought a M240i off them in September and I told them I was looking at a personal loan to finance the car, they asked me what the APR was on the loan (2.9%) and that was the end of the conversation really.

What finance rate were BMW offering out of interest (no pun heh heh).

they usually do 6.9% IIRC

[ZX10R NIN]

ITR1 said:

Thank you, I'll certainly test drive one when I can. Tbf I read a reivew last night which said the 2.0d is hard to overlook esp if you have the acoustic glass to drown out any noise it makes !

The 3.0d is the more desirable car & will be worth more as it's more sought after.

[ZX10R NIN]

ITR1 said:

Ah I see, so go AUC, they throw in some money on the basis that I take their finance, and then just pay it off pretty much straight away? I didn't know if BMW usually make a dealer contrib on AUC but I'll look into it. Thanks.

Yes that's it, yes BMW do add contributions onto cars you have to keep an eye out, it normally happens as new reg's come online.