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Should I buy or lease my new car purchase?

shutterstock_298063157Buying a new car is an enjoyable and very exciting experience. If you don’t mind waiting, you’ll be able to design your car exactly to your specifications so that the factory can then build it accordingly. Even if you’d prefer not to wait there are so many great deals out now with cars that have already been built, you’ll certainly find something that will tick all your boxes. Visit Car Buyer for a complete guide on the best new cars for 2018: https://www.carbuyer.co.uk/news/156714/new-cars-2018

Once you’ve decided to take the plunge to buy your new set of wheels, the next question you’ll have to face is how to finance it. With so many good deals out there now, it’s hard to know whether you should buy with cash, lease or get finance. Here we look at the options available, so you can work out which would be the best option for you and your circumstances.

Cash

If you’ve managed to save your pennies it’s probably burning a hole in your pocket whilst you deliberate over choosing the right make, model and getting all of your specifications. But before you take the plunge it’s worthwhile going through the facts.

The biggest downside of buying a brand-new car is that you will lose money on the car as soon as you drive it off the garage’s forecourt. A car’s biggest depreciation is all in the first 2/3 years, so bear this in mind if you are thinking you may switch your car in a couple of years’ time. If you’d like to work out a car’s depreciation, follow this link: https://goodcalculators.com/car-depreciation-calculator/

There is also a risk with brand new car purchases that you could encounter problems due to the newness of the technology etc.

shutterstock_287342567Leasing – Personal Contract Hire (PCH)

Leasing a car has become more popular in recent years. Historically this type of purchase was a common form of buying a car by companies for their staff. Nowadays it is reaching out to the personal market and is becoming ever more popular. You can find out more about these type of contracts by visiting Zen Auto.

There are several reasons why people are finding this an attractive finance option, especially compared to PCP contracts (Personal Contract Purchase). If you’d like to drive a brand-new car every few years this option could be right up your street. Unlike a PCP you won’t have to pay a balloon payment at the end and if you chose all the servicing can be included in your monthly payments. And what’s more your monthly payments are likely to be much less than a PCP simply because the leasing company can buy the cars from the manufacturers at high discounts which they pass onto their customers. Another reason that the monthly payments are low in comparison is that the VAT is paid on the monthly amount rather than the value of the car brining the cost down.

 

However, the downside of PCH, is that you will never own the car. At the end of your contract, which can be anything from 2-4 years, you simply walk away. You must also be careful not to go over the mileage amount that you agreed at the beginning of your contract otherwise you may have to pay penalties when you hand the car back.

Make sure you look at all your options carefully, so you can choose the right option for you and your finances.