First time leasing, any advice appreciated...

[bcc996911]

Hello All

Posting under a different username here as don't have access to my usual account (not sure that's relevant!)

Anyway I'd be grateful if anybody could give me any pointers / advice / things to look out for when taking the plunge on leasing a car through a business?

For the last 20 years or so we have always bought used cars outright (normally at 4 - 5 years old), and have tended to run them until they become too unreliable / old to continue as a daily. However we have both had enough of spending an increasing amount of time at the local garage chasing niggling faults around old high mileage cars and have decided to go down the leasing route. I think!

I have been looking over the last couple of months on leasing websites and have seen various offers including;

For 10k per annum

Land Rover Defender 2.0 P400e X-Dynamic SE 110 5dr Auto [2021].
£5900 initial payment, followed by 48 monthly payments of £650 (excl VAT).

Land Rover Range Rover Sport 2.0 P400e HSE 5dr Auto [2021.5]
£4900 initial payment 48 monthly payments of c£550 excl VAT

Volvo Xc90 2.0 T8 Recharge PHEV R DESIGN 5dr AWD Auto [2021] - not sure we want a Volvo though.
£4500 initial payment - 48 monthly payments of c£500 excl VAT

Normally when buying a car I have a good idea of whether to price is good value, or too expensive etc. but I'm really struggling to get my head around what represents good value on lease deals. Especially as having never bought a new car before I'm not sure what sort of discounts can be expected on list price etc.

Also as above would appreciate any advice on potential pitfalls or indeed benefits of leasing. Don't know why but I'm having a bit of a mental block on it...

Thanks!

[codenamecueball]

bcc996911 said:

Hello All

Posting under a different username here as don't have access to my usual account (not sure that's relevant!)

Anyway I'd be grateful if anybody could give me any pointers / advice / things to look out for when taking the plunge on leasing a car through a business?

For the last 20 years or so we have always bought used cars outright (normally at 4 - 5 years old), and have tended to run them until they become too unreliable / old to continue as a daily. However we have both had enough of spending an increasing amount of time at the local garage chasing niggling faults around old high mileage cars and have decided to go down the leasing route. I think!

I have been looking over the last couple of months on leasing websites and have seen various offers including;

For 10k per annum

Land Rover Defender 2.0 P400e X-Dynamic SE 110 5dr Auto [2021].
£5900 initial payment, followed by 48 monthly payments of £650 (excl VAT).

Land Rover Range Rover Sport 2.0 P400e HSE 5dr Auto [2021.5]
£4900 initial payment 48 monthly payments of c£550 excl VAT

Volvo Xc90 2.0 T8 Recharge PHEV R DESIGN 5dr AWD Auto [2021] - not sure we want a Volvo though.
£4500 initial payment - 48 monthly payments of c£500 excl VAT

Normally when buying a car I have a good idea of whether to price is good value, or too expensive etc. but I'm really struggling to get my head around what represents good value on lease deals. Especially as having never bought a new car before I'm not sure what sort of discounts can be expected on list price etc.

Also as above would appreciate any advice on potential pitfalls or indeed benefits of leasing. Don't know why but I'm having a bit of a mental block on it...

Thanks!

The leasing thread on here quotes 22% of the cars retail price over 2 years as representing a good deal. Doing it from the price the car is actually bought at is playing on difficult mode, but can represent a stonking deal if it inches in around that figure. Are these leases, or PCP?

I wouldn't want to be paying £550 a month on a Land Rover Sport out of warranty though...

[bcc996911]

See, thanks, that is useful advice already. I hadn't thought about the what happens if something goes wrong with the car on a 48 month deal after the 36 month warranty runs out. Useful advice!

Guess I could extend the warranty, however the whole point of this exercise is to remove the cost / risk of running cars out of warranty.

In answer to your question, these are lease deals through a business.

[codenamecueball]

bcc996911 said:

See, thanks, that is useful advice already. I hadn't thought about the what happens if something goes wrong with the car on a 48 month deal after the 36 month warranty runs out. Useful advice!

Guess I could extend the warranty, however the whole point of this exercise is to remove the cost / risk of running cars out of warranty.

In answer to your question, these are lease deals through a business.

The other advice given in that thread is buy the deal, not the car. If you go looking for a specific car you'll never find a deal, but a class will get you a deal if you keep your ear to the ground and pull the trigger quickly. I highly suggest lurking that thread and signing up to the lease deal emails they recommend.

With a quick glance at LeaseLoco, I've found a RRS P400E coming in at a bit less than your quote on a 36 month term, however with just 5000 miles a year. https://www.leaseloco.com/car-leasing/land-rover/r...

If you're feeling bold, here's a 2 year deal on a P575 SVR which beats your price of 10k a year. Still 5000 miles and a fat initial payment though so you won't get to enjoy it too much.
https://www.leaseloco.com/car-leasing/land-rover/r...

[bcc996911]

Thanks for that; I'll have a look at the lease thread.

Sorry my initial post wasn't very clear; the 10k I refer to is annual mileage. I need a a deal that allows 10,000 miles a year.

I've now started to search on 36 months though rather than 48 months after your first comment.

With reference to buying the deal rather than the car, unfortunately the new Defender is about the only new car that meets our criteria and that the wife actually likes as well. As it's quite a big financial commitment and a step up for us, I need her on board!

She also like the full fat RR but I think they're just too much monthly at c£750 so I chucked the Sport in there as it looks a bit cheaper than the Defender.

Cheers

[Belle427]

Have you looked at the Jag F Pace too?
When I looked there seemed to be better deals on them, I'm guessing they are much the same underneath.

[SlowAndDull]

Another consideration is servicing costs - leases can oblige you to service at a main dealer, with associated costs. I had a V90 on a 2 year deal - second service was due just after handing back, which I understand would have been over £600 (2 months’ lease payments).

I’m a recent convert to leasing (particularly now with EV BIK rates) - and am surprised how cost-effective they are. Same as you I’d always bought 3-5 year old cars and run them into the ground. My V90 cost £8.5k to lease for 2 years, after which it was sold at a main dealer for £21k. Considering it’s a £45k list car, someone has to be losing money somewhere!

[covmutley]

I'd say you are a few years too late to leasing. Nearly all the deals now seem very average, unfortunately.

I had a lease car when they were cheaper, but didn't find it as hassle free as I thought. Tyres still puncture, it still needed a service, I was conscious of the milage limit on the deal and I knew that I would be charged for any mark on the car at the end. But the question was, how much??

I did collect a couple of shopping trolley type dings and a kerbed alloy, and it cost me about £400 from memory. I thought that was fair enough, but handing a car back and paying money to do so just didn't sit right with me.

In your situation I would buy a 3 year old approved used car to get the manufacturer warranty, and rinse and repeat every 2 years. I think that would be significantly cheaper, if that matters.

Couple of other things.. I completely agree that you need to shop the deal, not the car. You really have to jump on a good deal so thst may mean no test drive, Options are generally a bad idea as they just charge you for it over the lease term, being locked into a deal could be a pain if your circumstances change. ...

Edited by covmutley on Thursday 18th February 07:19

[MarkJS]

covmutley said:

I'd say you are a few years too late to leasing. Nearly all the deals now seem very average, unfortunately.

I had a lease car when they were cheaper, but didn't find it as hassle free as I thought. Tyres still puncture, it still needed a service, I was conscious of the milage limit on the deal and I knew that I would be charged for any mark on the car at the end. But the question was, how much??

I did collect a couple of shopping trolley type dings and a kerbed alloy, and it cost me about £400 from memory. I thought that was fair enough, but handing a car back and paying money to do do just didn't sit right with me.

In your situation I would buy a 3 year old approved used car to get the manufacturer warranty, and rinse and repeat every 2 years. I think that would be significantly cheaper, if that matters.

I think your first point is incorrect - there are still some very good lease 'deals' around, but as mentioned you need to go for the deal - not the car. M135i's & the latest Golf GTi's are pretty cheap to lease right now (as an example). The deals in the OP arent great but he/she seems to be looking at a particular type of car 2 of which from the same manufacturer.

I would always rectify any cosmetic issues with my (private) car before selling it, or expect the cost of repair to come out of the money I get for it from the buyer so they can rectify. Same result as you paying when you hand your leaser back.

All of that being said - I didn't find leasing was for me (for the moment at least). On a 2 year deal, within 3 months, I was thinking about what I would get next. Also, delivery times are all over the place so you have to be very lucky or be prepared for some inconvenience when it means going from one lease car to another. But, if you're up for it, then no problem at all.

[covmutley]

MarkJS said:

I think your first point is incorrect - there are still some very good lease 'deals' around, but as mentioned you need to go for the deal - not the car. M135i's & the latest Golf GTi's are pretty cheap to lease right now (as an example). The deals in the OP arent great but he/she seems to be looking at a particular type of car 2 of which from the same manufacturer.

I had a look at m135 the other day. About 460 for a 3+23 on 10k. The old m135 and golf r were under 250. Trl deals was banging the 135s out. Had a look on his baby bmw page and it's like a ghost town now

Wasn't the alfa 4c available for under 300?

Edited by covmutley on Thursday 18th February 09:31

[Hfs1889]

If you're going through a business then is the BIK tax a consideration for you?

I'm moving from a personal lease to a business lease this year because I can get a better car (with the VAT taken into account) and the BIK is minimal on the PHEV I'm getting compared to other options. I can also be flexible with how I pay myself with the split between PAYE, Directors loan account and dividends so it works for me.

[MarkJS]

covmutley said:

I had a look at m135 the other day. About 460 for a 3+23 on 10k. The old m135 and golf r were under 250. Trl deals was banging the 135s out. Had a look on his baby bmw page and it's like a ghost town now

Wasn't the alfa 4c available for under 300?

Edited by covmutley on Thursday 18th February 09:31

Arnold Clark currently doing this. There's a PH thread running somewhere and there are also some better deals on the 128ti:

BMW M135i
10k miles per annum
3 + 35
£346 per month

I saw the latest Golf GTi being offered at £280 pcm + VAT earlier this week

I understand this isn't like the the old deals of the M140i & Golf R etc, but there are some decent value lease offers out there.

[ilikejam]

As others have said, the cardinal sin is to lease something out of warranty - then you're on the hook for fixing someone else's car.

When considering your mileage, try to find out what the excess mileage charge is. A few years back I had an Audi that was cheaper to take a 5k p/a deal and then pay the excess charge than it was to take a 10k p/a deal up front. In the end I actually only did 18k over the term so saved even more.

Broker sites are good for surfing to get an idea of the models on special offers at the moment. If you see one you think looks good, give a few dealers a call direct and see if they can match it - that way you don't have to pay the broker admin fee. Also check WhatCar Leasing for direct dealer deals.

A lot of people seem to worry about the end of lease charges, but unless you just lurch from kerb to fencepost to wall it's really not an issue. The first lease I had (Audi A4) had picked up a couple of trolley dents, a chipped windscreen and kerb rash on one of the alloys. I was charged a grand total of £36. The end of lease charges are almost universally cheaper than having the repair done (because they have no intention of actually repairing anything before shifting it on).

A friend of mine had seemingly done his best to dent every panel and scratch every alloy on a Mini a few years back. The inspector totted it all up and the calculation was £900. He then phoned Mini finance (or whoever it was) to contest it and they said they'd look into it. 2 weeks later he got a letter saying it had all been cancelled and nothing to pay.

Edited by ilikejam on Thursday 18th February 14:10

[plasticpig]

ilikejam said:

As others have said, the cardinal sin is to lease something out of warranty - then you're on the hook for fixing someone else's car.

Edited by ilikejam on Thursday 18th February 14:10

That's assuming your leasing without maintenance included. If you are leasing with maintenance then the lease company pays to fix it out of warranty.

[bcc996911]

Thanks for the above everyone; all food for thought and definitely helpful on the leasing out of warranty advice.

I think I'll keep an eye on the big sites and see what comes up over the next few weeks / months.

Luckily as the car will be leased through a Partnership rather than a limited company we won't be liable for BIK and can claim certain elements back on both tax and VAT the accountant has confirmed today.

I added up maintenance and depreciation costs on the current vehicle over the last 4 years and it's cost c £270 pcm + £250 pcm in fuel so c£520 pcm for an old car that's starting to throw up regular faults (air suspension issues, electrical gremlins) etc.

Seems ideal to lease a new RR Sport for c £550 pcm before I claim back elements of this through the business. Mon - Fri only do about 25 miles a day so this would be on the battery range meaning fuel costs of c£1.50 for an overnight charge.

Unless I'm missing something and applying the logic of the man maths it seems a no brainer to me... famous last words

[anonymous-user]

Unless you can put up with the basic spec on a RRS HSE it will add up pretty quickly.

[maz8062]

The maths add up apart from why you’d look at 10k per annum given the low mileage that you cover during the week. 6 or 8k may work out cheaper, or 5k plus the cost of excess.

[Shackattack123]

01WE01 said:

Unless you can put up with the basic spec on a RRS HSE it will add up pretty quickly.

And never actually driving the car

My mate works for JLR and he says avoid the hybrids like the plague. One was in the workshop for 3 months waiting for a new battery pack from overseas

[anonymous-user]

I have had 1x FFRR p400e for 16k miles and have another p400e on order to join it in the garage...

Never had an issue with the batteries, nor heard of any.

Though I will concede all the dealers are st.

[bcc996911]

maz8062 said:

The maths add up apart from why you’d look at 10k per annum given the low mileage that you cover during the week. 6 or 8k may work out cheaper, or 5k plus the cost of excess.

Yes not a bad shout - I'll have a look at excess mileage costs compared to upfront.

Her mileage over the last few years has been a pretty steady 11 - 12k per year made up of the 25 mile commute / school run which is about 6,000 per year and then business mileage whilst at work, plus family holidays (French Alps a couple of times per year, a few weekends away and general weekend day trips) must add the rest.