Lease Transfers

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Just looking on the US forum, and there seem to be a few people wanting to transfer their leases, mid term. Apart from a lease transfer fee, they just take over the monthly payments....obviously there is a settlement at the end, but seems an easy way to get into car with nothing down as such. Wonder why finance companies can't do that here...
 
Don't think I could Lease as I'm sure "cash is still king" and I like the comfort of owning the car outright :)
 
Kryton said:
Don't think I could Lease as I'm sure "cash is still king" and I like the comfort of owning the car outright :)
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There are many reasons to lease cars, but as it happens none of which work for me financially and I agree that buying outright is my preference.

I guess if you can find the right remaining lease it could be perfect. Say you wanted to get a large car for just 1 year then it would be just a fixed payment and no buy/sell or capital outlay involved.
 
I'm just curious to know if I had leased the car instead, would I have lost less than having bought it outright and sold it....I know I have taken a huge hit on it, and that's what's stopping me selling it now. If I had leased it, would I have been any better off, say after 3 years?

Also do residuals on cars or should residuals on cars dictate what we buy? Just because one can afford to lose £20K in a year on a car, doesn't make someone clever by virtue of the fact they may be able to afford it. I certainly can't afford it and I try to block it out in my mind how much I've lost!!

I bought my Range Rover Sport at a year old for £39K (new was £52K) and sold it 3 years later for £24K, and that made great sense to me....
 
Nickm said:
I'm just curious to know if I had leased the car instead, would I have lost less than having bought it outright and sold it....I know I have taken a huge hit on it, and that's what's stopping me selling it now. If I had leased it, would I have been any better off, say after 3 years?

Also do residuals on cars or should residuals on cars dictate what we buy? Just because one can afford to lose £20K in a year on a car, doesn't make someone clever by virtue of the fact they may be able to afford it. I certainly can't afford it and I try to block it out in my mind how much I've lost!!

I bought my Range Rover Sport at a year old for £39K (new was £52K) and sold it 3 years later for £24K, and that made great sense to me....
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Interesting thread this. I bought a house in Aug 2006 which following the economic woes is now worth about 10% less than I paid for it. I know falling house prices is a concept Londoners find hard to imagine but up here in t'North it's a grim reality !! During that time I've probably paid £70k in mortgage repayments. I wish I'd bloody rented instead of buying and invested my equity elsewhere !!

Residuals certainly dictate which car I buy because like you Nick, I can't afford to throw good money after bad. Or perhaps more accurately residuals tell me which cars I definitely WON'T buy. That's why I never buy brand new for example. I let someone take the first year hit as you did with the RRS.

Do I wish I'd waited a year or two to buy my M ? Yes in some ways but I've had two great years owning it and I paid £25k so if I get rid in 2 years time for £13-14k I don't think that's bad in 4 years.

My next car will be some derivative of the 911 because in that category of car not only is its ability better than its peers but its residuals are too. A happy combination.
 
The buy new or second hand is different and I'd never buy new again as argued above. I keep cars longer and save money best spent elsewhere and use conventional finance. Case in point is an XF purchased for £30k 15 months old, 14k miles and depreciated near £30k for the first owner. I'll at worst lose £20k in the next 3 or 4 years and have a small residual asset. Leasing new would be at least twice the finance payments (excluding capital injection).

My daughter has her cars on pcp which are close to leases. What she likes is a fixed outlay for a know period with no capital to put in and can just trade or walk away every 2 years.

Values have changed so much and her first Mini was a no brainier to just hand back as depreciation was greater than the pcp cost, so a real winner. Now they have adjusted and lease prices seem much higher so the benefit has much reduced :(

It would be interesting to see the real arguments for buying part leases and how they wash out over the remaining term.
 
Yes happy days when the GRVs were set at what turned out to be unrealistically high levels. I think the only time depreciation is less painful is when you keep the car for a longer period (the 5.5 years I've had my Zed are the longest I've ever owned a car, I've bought and sold five others during that time LOL) and frankly the value now probably isn't an awful lot less than it was at three years, supporting CJs argument about s/h being much better value. :)
 
Leasing can make sense sometimes, either personal leasing or as a PCP. The current Z4 20i deal is a good example of a decent PCP.

The problem with buying and selling traditionally is that your car always seems to be worth less than what you thought it would be worth when you bought it and did the calculations. When I got my SLK350 in 2007 deals were scarce, there was a bit of a wait if you ordered one, and therefore I got about £1500 off list for a demo car. I wasn't that bothered as at that time 3-ish year old cars were trading for rock bottom of £20k and retailing for £25k and upwards.

But fast forward to 3.5 years later when I come to sell it, and Mercedes are shifting face-lifted Sport models with sat nav for £10k under list at a year old, so when I had been banking on getting minimum £20-21k for mine I ended up getting £16.5k.

Nickm, I feel your pain. Who would have though BMW would be offering an £8k deposit contribution on the M Sport.
 
we took PCP for our mazda... and in the meantime have been saving the extra that will be required for the balloon payment. That extra lump sum has been offsetting our flexible mortgage quite nicely too.

took a straight loan for the DS3 though - worked out cheaper than the dealer was offering.
 
The PCP scheme is good for people who swap their cars on a regular basis, every 2 years say. With the exception of the current Z4 offer the overall cost is usually more than conventional finance.
The key advantages though are, low repayments, and the option to either buy the car outright after the agreed term, part ex it for a new one, or simply hand it back. Plus you have a guaranteed future value, i.e the final lump sum payment. A good thing to have if valuations plummet.
 
I disagree, if I was on a PCP, I'd be well within negative equity by now. My car has dropped £16K in one year....
 
The big issues with PCP's as I see it are that interest is payable on the GFV for the entire term of the PCP' which is often not understood and these days the GFV has had to be set much lower given the drops in values predicted by the end of the term and still often leads to loss of the initial deposit and/or no equity to carry forward.

Not against them at all but they don't suit everyone.
 
Nickm said:
I disagree, if I was on a PCP, I'd be well within negative equity by now. My car has dropped £16K in one year....
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Which could also be the case if it were a conventional loan. Dependant on how much of the car is financed and how long for, along with how much it depreciates.
 
cj10jeeper said:
The big issues with PCP's as I see it are that interest is payable on the GFV for the entire term of the PCP' which is often not understood and these days the GFV has had to be set much lower given the drops in values predicted by the end of the term and still often leads to loss of the initial deposit and/or no equity to carry forward.

Not against them at all but they don't suit everyone.
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And of course they can bite you on the bum....if you state annual mileage at 10-12k then rates are reasonable, otherwise they rocket.....but if you want to chop the car in at the end and have exceeded that stated mileage (which kept your payments lower) you get whacked with mileage charges too. They get you all ways. :(
 
But the key thing to remember is, whether you buy it cash or on a PCP, the price your car goes down by is always coming out of your stash......never anyone else's. Certainly not the finance company.

There is an argument say, why pay 100K cash for a car, when you could lease it, and use your money elsewhere. I have been told to do that by a couple of people now. Look at footballers for eg, they earn say £100K a week, and very little they buy is cash, cars and houses included.

Moral of the story, whether you're losing 20K or 100 K, a loss is a loss, whether you own it or not, I can't see it being a wiser decision either way to be honest........
 
Nickm said:
There is an argument say, why pay 100K cash for a car, when you could lease it, and use your money elsewhere. I have been told to do that by a couple of people now. Look at footballers for eg, they earn say £100K a week, and very little they buy is cash, cars and houses included.

Moral of the story, whether you're losing 20K or 100 K, a loss is a loss, whether you own it or not, I can't see it being a wiser decision either way to be honest........
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Not sure I agree with that, I know a footballer who has a contract with one of our companies who pays cash for everything and I'm sure his team do the same.

Yes a loss is a loss as you say, but what matters is how you are financially able to cope with that loss. :)
 
That's a good point...whether you care about losing such money is another matter. But I would have thought being financially astute makes you care for losses more so. Going by your previous car and your new 911, you seem to have that angle covered and you jumped ship at the right time on the Z.
 
What about the inspection at the end of the lease ? From my experience of company cars, if there is the slightest mark, they hit you with a repair charge. Would you really want to be taking responsibility for a car that may have a huge cost coming with it to repair to 'reasonable standards' ? I wouldn't.
 
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