Author Topic: Leasing a new car  (Read 1463 times)

taylost3

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Leasing a new car
« on: August 07, 2017, 07:15:58 AM »
I currently have a lease car which goes back in November. I've seen an offer for a BMW M140i which is so tempting, help talk me out of it please, we already have a small Mazda2 that's paid for I can use but as a bit of a petrol head the BMW is calling me and I'm struggling to resist.  It is a good deal at £300 PCM for a 36k car but that's 11k that can help me FIRE early, I'm torn, help wise mustachians.

Monkeytennis

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Re: Leasing a new car
« Reply #1 on: August 07, 2017, 12:40:07 PM »
11k @ 6% compound interest over 12 years = c.£20k, thats probably a year off your FIRE date..... or using the 4% rule £800 a year post FIRE. Thats a holiday for a week every year for the rest of your life.

taylost3

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Re: Leasing a new car
« Reply #2 on: August 07, 2017, 12:49:52 PM »
Bloody good point that's exactly the kick up the a$$ I needed, I can do without the car! Must stay strong

UKMustache

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Re: Leasing a new car
« Reply #3 on: August 07, 2017, 01:22:25 PM »
That price sounds a bit low, how long is the lease and what mileage?  I've never had a lease car but that sounds a lot of car for the money.

taylost3

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Re: Leasing a new car
« Reply #4 on: August 07, 2017, 01:45:11 PM »
It's a 5 door auto 8k per year 35 x £300 and a £900 deposit. It's a bargain for the car but still 11k I don't need to spend.yiu can get some amazing lease deals I currently have a Scirroco R that's costs me£125 pcm with 2k I paid upfront.

skip207

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Re: Leasing a new car
« Reply #5 on: August 07, 2017, 02:09:45 PM »
The car market is suffering at the moment.  Diesel scandal, new VED rates, uncertain future of the internal combustion engine, increased congestion charges etc etc etc.

As you point out there can be some very cheap lease deals out there.  VWs in particular.  Golf GTD for 199 a month.  Sure its £2400 a year but its a fixed cost.  I bought a 5 year old used car and its probably lost more than 2400 a year, that's before I fix minor faults which would be covered under warranty.




taylost3

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Re: Leasing a new car
« Reply #6 on: August 08, 2017, 06:39:55 AM »
The car market is suffering at the moment.  Diesel scandal, new VED rates, uncertain future of the internal combustion engine, increased congestion charges etc etc etc.

As you point out there can be some very cheap lease deals out there.  VWs in particular.  Golf GTD for 199 a month.  Sure its £2400 a year but its a fixed cost.  I bought a 5 year old used car and its probably lost more than 2400 a year, that's before I fix minor faults which would be covered under warranty.

There have always been some amazing deals on lease cars to be fair for various reasons I think this M140i is the end of the line with BMW going to 4 cylinder x drive 1 series as of 2019. If anyone is interested in leasing I know it's not very MMM but check out piston heads they have a leasing thread with some brilliant offers.

skip207

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Re: Leasing a new car
« Reply #7 on: August 08, 2017, 07:14:42 AM »
Ahh a fellow car guy eh?  Watch out they burn us at the steak round here!!

(MMM gets mentioned in the finance section on PH now and then)

taylost3

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Re: Leasing a new car
« Reply #8 on: August 08, 2017, 07:23:19 AM »
Absolutely I'm a huge petrol head and my lust for some shiny new metal is having an impact on my FI for certain. I've decided against the M140 but now a C63 is taking my eye and trying to take my hard earned £££'s! Must resist!

skip207

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Re: Leasing a new car
« Reply #9 on: August 08, 2017, 07:31:03 AM »
Its not very MrMM but yes I enjoy the sound of a flat plane V8 ;)


taylost3

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Re: Leasing a new car
« Reply #10 on: August 08, 2017, 07:35:33 AM »
Yea it's an absolutely epic noise, however, the novelty soon wears off and I'll be lusting after something else so the sensible part of me will hopefully win out and I'll stick to the Mazda2 we have at home all paid off when my current lease car goes back.

cerat0n1a

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Re: Leasing a new car
« Reply #11 on: August 08, 2017, 09:01:25 AM »
Sure its £2400 a year but its a fixed cost.  I bought a 5 year old used car and its probably lost more than 2400 a year, that's before I fix minor faults which would be covered under warranty.

What's in it for the company selling you the lease? How are they making money on the deal? (Genuine question - the sum cost of all the cars I have ever bought over 20+ years is still only 4 figures, so I have no clue about new car economics.) Don't you have to pay an amount upfront on top of the £199 per month? How much do people typically pay for damage/cleaning when the lease finishes?

taylost3

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Re: Leasing a new car
« Reply #12 on: August 08, 2017, 09:06:41 AM »
The lease companies will get a huge discount on the list price of new cars. Say for example a car is 30k rrp they may be able to buy it for as little as 20k with certain discounts. They lease the car for 2 years at say £250 a month earning them 6k in 2 years. they then sell the car for 18k maybe and make 4k. That's a very simple version of how I think it works but could be wrong.

You get charged for certain damage but fair wear and tear is acceptable in accordance with guidelines by a 3rd party. Cleaning is a quick once over with the hoover and a bucket and sponge prior to returning the car.