| Archive for Downsizer For an ethical approach to consumption |
| Nick |
Going to get a new car.New to us, at any rate. The good lady's car is just not reliable enough. I don't have much of a lump sum to use, but I do have significant surplus monthly income, so what are the current options for car buying/obtaining?Clearly I can get finance from the main dealer on a new car, but I'm guessing I'll get a great price, and a huge APR. Anyone any experience of leasing a car (personally, I have a company one)? Does anyone lease second hand cars? And I hear tell of lease deals from dealers that allow you to buy the car at the end, or trade it in for another one. So long since I've had to obtain a car that I don't know where to start, and then I thought of you lot. 
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| Cathryn |
Why don't you get someone who knows to buy you one at auction? | ||||||||
| Nick |
Re: Going to get a new car.
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| Rob R |
I can lend you a brick 
This website seems to say they lease used cars: http://www.carleasinguk.com/funding-options.html |
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| sean |
Re: Going to get a new car.
Then take out a loan. Secured on your house if you feel confident, or not if you don't. It'll be massively cheaper than any sort of finance/car buying scheme. |
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| gil |
I used to know someone who leased his Ladas/FSOs. Changed every three years, as you say, Nick. He thought it worked well as an arrangement, and must have liked the make of car too. | ||||||||
| Nick |
That the cheapest option, you think, Sean?
Yeah, leasing seems to make sense, at least over buying. You can get a brand new Fiat Panda for under £100 a month, including servicing. Why would you buy? I'm not stuck on a new vehicle, btw, it's just that's what you find when you hunt for leasing schemes. |
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| sean |
As far as I can see yes. Leasing is just like buying a car on a credit card then making the minimum payment every month. |
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| Treacodactyl |
Take out a credit card with 0% finance for 6 months? A personal loan could be had at around 7% APR at the moment, you could find a car and see what sort of deal a dealer would do for cash and for financing and then decide. When I looked at leasing it seemed much cheaper to buy. | ||||||||
| Rob R |
College leased all their tractors to keep capital for other things, they reckoned it was definitely cheaper than buying. | ||||||||
| Nick |
Do dealers take credit cards? I suppose they do. |
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| MarkS |
If you keep the finance separate from the purchase you'll get the best deal.
A new fiat panda diesel costs under £6k for example (7k for the entry grand punto) |
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| tahir |
Of course colleges are renowned for their financial nous.... |
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| Cathryn |
As do auction houses 
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| Nick |
Yes, you're right. Yell at me. As for college doing it, I wonder if there's tax reasons to lease, rather than borrow and pay. Certainly, we lease because it helps control cash flow, and is easier to run, (we don't have to worry about selling off cars every few months). But why do businesses lease, and not borrow to buy? Is it the hassle of owning vehicles, or would leasing be tax deductable, but loans (and interest) not be? Dunno. |
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| Rob R |
Lease v Buy | ||||||||
| Treacodactyl |
The last few cars I've bought the dealers took credit cards for the deposit. That way you get protection for the whole amount if things go pear shaped. The dealers might not like you using it for the whole amount but you could agree to add the fee of a couple of percent to the price, it should still work out cheaper. |
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| MarkS |
yes - cant remember the details and there is a tax break if vehicles are your business rather than being used in the business. VAT claimable ? also lease companies buy in sufficient numbers to get huge discounts. their deals with the manufacturers dont allow them to resell within 6 months - which is why some car supermarkets will not let you have the v5 when you buy the car. |
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| Silas |
First negotiate your car purchase. Get the best price you can, then ask about dealer finance - it will very often be cheaper than banks or high street lenders. You can play lenders off against each other just as you would when buying a tangible product like a car. Dealers may take credit cards for car purchase, but the credit card companies do not like it - ask yours first! | ||||||||
| Silas |
Be sure you know the differences between lease, contract lease contract hire, PPP, hire purhase and personal loans - it is very important. | ||||||||
| MarkS |
they can negotiate with the bank. I bought a (used) 911 on switch - the dealer was surprised it wasnt a credit card but said they would negotiate the fee down. also dealers will take recurring credit card authority for monthly payments in some cases (thats how they tried to sell me the above - I must have looked much poorer than their usual customer) |
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| tahir |
Wotcha Silas
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| Silas |
There is no fee to the dealer for taking switch - if they charged you any fee at all you were ripped off. |
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| Silas |
Hi Tahir............ |
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| Rob R |
VAT is claimable on all business expenses, providing they are used for the business or a proportion of as appropriate. Loans are VAT exempt whereas leasing/buying isn't. |
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| Silas |
Careful here, vat on car ( and some commercial vehicles) is just not that straighforward. Contract hire payments are subject to VAT, lease purchase and hire purchase payments are not. Even so, you may not be able to recover ALL the VAT even if you are VAT registerd. |
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| tahir |
Not quite true, there's a flat rate fee regardless of amount, it's usually pennies. |
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| Rob R |
Sorry, I was referring to the college doing it. As far as claiming it back goes it would depend wether or not it is available for personal use or not. If so you would only be able to reclaim 50% of the VAT on the finance side, but 100% on the maintenance side. If it's all business use, then 100% on it all. |
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| Maxwell Smart |
As far as I know the only way you will get all your VAT back on a motor vehicle is if you can proove it NEVER gets used for personal use. Not easy to do. Nick - speak to your accountant. If you have your own business and you lease it generally makes more sense from a tax point of view. |
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| Behemoth |
Some do but may pass on the 2% transaction charge. |
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| MarkS |
they didnt charge me. the guy who took the payment took the receipt over to someone else and I heard him ask them to talk to the bank to negotiate the handling fee. |
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| Silas |
If it is a used car it has to be VAT qualifing, not many of these around! If it is a new one you may be able to reclainm the vat on purchase, but will have to charge vat when you sell it. |
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| Nick |
Without wishing to derail any debate, the car will be for my wife, and nothing to do with a business at all.
Tha Vat/tax debate came up because we were wondering if businesses preferred leases to loans for some reason, and if I should think along the same lines. |
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| Silas |
The only finance options that affect the VAT are Contract Hire and contract lease, neither of which are designed for the domestic consumer. Plain old conventional HP is usually the best route - I would give any form of PCP a very wide berth if I were you. |
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| Cho-ku-ri |
Why has nobody suggested either making do, or buying (recycling) a cheap car until you have saved enough to buy the car you want. If you have a decent surplus of wages each month it shouldn't take long. Borrowing money to buy an asset that will plummet in value is an obvious no no. 
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| Jonnyboy |
Assuming he wants to buy a new small car, the obvious advantages are increased reliability and safety, plus decreased emissions over an older vehicle.
If his wife is settling for something she doesn't want then it's a different kettle of car parts |
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| Nick |
You're right, of course. However, the money we had saved, we've invested elsewhere, and it's bringing in a monthly surplus now, so we are essentially using our savings to work for us.
Practically, my wife's car is beginning to cut out on her during journies. We've had it in the garage a couple of times, and it's some kind of intermittent electric fault. Parts have been replaced, but because it's an intermittent fault, we are struggling to fix it. It's a vehicle of such an age and value that's it's not worth spending much more on trying to repair the issue. I'm away at work for days on end sometimes, and leaving her with an unstable car and two small kids isn't much of an option. The recent flooding has brought it to a head, it failed again when it was damp, and we were unable to get it out across the fields. We'd like to replace it with something able to cope with either the water or the field route before the winter turns up. This means we'll have a few months saving but need finance, of some form for the rest. So, yes, you're right, but the way we've structured our finances, we're able to borrow and it makes the most sense to fit our lifestyle. We could change lifestyle, but that would mean either giving up work for one of us, or making the kids walk the 2 miles into school, and 8 miles to town. So, here we are, looking at borrowing.
And as for cars plummetting in value, that's not necessarily the case. We may not go for a new vehicle and also we'll get a daily return on it as useage. The financial value is only one part of the value of owning a car. |
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| Cho-ku-ri |
I'm sure you have thought it through, but all the money gurus hate 'borrowing', especially if you have savings else where. I'm sure you have worked out the returns on your investments etc after tax, but bear in mind, money lenders do so, to earn more cash than if they invested it in a similar way to which you have. Remember there is no such thing as either a low interest or 0% loan on anything. You are paying for it in the inflated purchase price. IMHO.
Obviously if your wife's car is "dead", then it is time to replace it. Good luck on your new choice. 
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| Nick |
As an alternative, I don't suppose Reiki love works on old VWs? And if so, does it come with an insurance backed warranty?
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| Rob R |
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| Cho-ku-ri |
Reiki love does work on old VWs BTW.
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| Rob R |
Perhaps you could send some NLs way 
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| MarkS |
what sort of old vw (model and engine) and tell me more about the problem. My brother is a vw specialist. |
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| Nick |
You can smile, CKR, we paid cash, in the end. (Mostly).
And, MarkS, thanks, but it wasn't worth spending any more cash on it, to be honest. |
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| VSS |
The question i have difficulty with is knowing when it is not worth spending any more on. My Discovery has been a fantastic car, so reliable and versatile, BUT it is costing me quite a lot to keep it on the road.
The advantage is that i know about the things that are wrong with it and what is likely to need fixing next. If i buy a replacement i could just be buying a whole load more trouble. What is the best thing to do when walking is not an option? |
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| Jonnyboy |
What did you get Nick? 
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| Nick |
A low emission Prius thingie. | ||||||||
| tahir |
Be good offroad I reckon | ||||||||
| Jonnyboy |
Cool, nice to see someone putting their money where their mouth is. |
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| orangepippin |
There has been some criticism of the Prius in terms of its "whole life" environmental impact - i.e. the metals used in the batteries. No idea whether that is just counter-marketing by manufacturers with alternative solutions.
There is also some good stuff on the 4Car website about using better driving techniques to get better fuel economy, basically drive a bit slower than you usually do. |
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| Jonnyboy |
You mean that he could have got a more suitable 4x4 and if he had driven it sensibly and kept it a long time then his overall 'whole life impact' might be less? | ||||||||
| Silas |
Probably not as environmentally friendly as they wuld have you believe............. |
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| orangepippin |
The environmental impact of a car is not just the published mpg. The manufacture and disposal impacts must also be taken into account. I’ve heard that mining and subsequent disposing of the metals used in the Prius batteries have quite a high environmental impact, but as I said, I don’t know if that is true or not. There is some info here: http://en.wikipedia.org/wiki/Toyota_Prius - it includes an amusing comparison “A Hummer is more energy efficient over its lifetime than a Prius”, as well as Dept of Transport CO2 assessment (joint 2nd, the VW Polo 1.4TDI is first). Also it is worth noting that many small diesel cars do a better mpg than a Prius in some scenarios – I believe the Prius is best in city driving where it can take maximum advantage of the re-generative braking, whereas on say a long motorway journey it is essentially a petrol car and a small diesel will do a better mpg. I have an old Subaru. It used to do 30mpg. I found in the petrol strikes a few years back that if I stuck to the inside lane of the motorway and did 60mph instead of 70+ I could get 37mpg. Still not great, but better than before. I’m aware a Prius or indeed almost any new car will do better mpg than this of course. |
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| Nick |
Alright, I lied. I bought a Jeep. | ||||||||
| tahir |
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| Nick |
Bah, it's fit for the job I need it to do, it was well within budget, and, most importantly, it was the right colour for her.
I did, at least, talk her out of the Wrangler Sahara Unlimited, although it was very, very cool to drive for a while. |
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| orangepippin |
Colour is important.
Toyota have a sort of 4x4 Prius too. Probably a compromise too far though - not that environmentally friendly, and likely to get stuck if the mud is too thick. |
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| Jonnyboy |
I feel violated. |
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| Mary-Jane |
Whaddya expect? This is Nick we're talking about...
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| Nick |
D'ya know, I'm hurt. What have I ever done to you two? PMs do not count for this discussion. | ||||||||
| Jonnyboy |
Soft target, I can't help myself. |
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| Rob R |
Could be worse, he could have bought an aging supercar & wrecked it on the way to Slough...
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| Nick |
? Does this mean anything to anyone? (What am I missing?) | ||||||||
| Rob R |
Top Gear, what I saw last night | ||||||||
| Nick |
Ah, yes! Seen that. But I bet they had enough fun to make up for it. | ||||||||
| Treacodactyl |
Don't forget the chrome bull bars and empty roof rack. Oh, and one of those cycle carrier things that has a two foot pole sticking out about head high from the back of the car. If you come round this way you'll fit in.
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| Nick |
No, no extras. Although I might add a tow bar, is that OK? I sort of need it for towing livestock and bales and stuff. Ideally in a trailer, like. | ||||||||
| Behemoth |
A Jeep?! You'll sell your children to buy the spares.
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| Nick |
Then everyone's a winner. | ||||||||
| Mary-Jane |
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| dougal |
Trying to catch up, I *was* going to ask whether a Prius could take a tow bar, but decided I ought to read back a bit. Shan't ask now... |
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| Northern_Lad |
That's just cruel: either get them to walk, or let them sit inside, don't just drag them along. |
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| Northern_Lad |
There's not enough fun in the World to make up for Slough's existance. |
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| Maxwell Smart |
If its Diesel then just stick veggie oil in it and you're all set.... |