Is Leasing or Buying your Next Car The Best Option for YOU?
Choosing whether to buy your next car or lease can be a tough decision to make, as there’s pro and cons either way. Customers in the UK spend on average around 3 months looking at all the options before finally deciding which model they would like to drive, with the next big question these days being should I buy or lease?
When the time comes for a new car, what many people don’t do and really should, is take into consideration the financial aspects of purchasing a new car and whether buying or leasing is the best option for you.
To give you more of an understanding of what the difference is between buying a car versus leasing, Flexed have compiled the following key differences that you might want to consider before making your decision.
In order to be able to lease a car with Flexed, you’ll need to fill out the appropriate Business Lease or Personal Lease application form and undergo a credit check to ascertain whether or not you’re eligible for vehicle finance. Most car leasing companies are looking for a ‘good’ to ‘excellent’ credit score but here at Flexed, we have our own in-house finance department who deals with each application individually, so don’t be disheartened if your credit score is poor, as we have other options available. If your application falls into a ‘grey’ area, we may ask for a refundable deposit to sit on your account which will be refunded back to you at the end of your lease period.
2. Upfront Costs
At Flexed, we don’t charge a standard deposit for our leases, plus what your final quote comes to per month, is what you’ll pay for however long you lease the car for. This means you know exactly how much you’re paying every month and don’t have to find the extra money for a deposit that you would normally have to find when purchasing outright.
3. Mileage Costs
All of our cars include a 1,250 miles per month allowance but if you’re wanting anything more, this will obviously have an impact on how much you pay every month. If you exceed your agreed mileage allowance, you’ll have to pay an excess mileage fee at the end of your lease contract which is calculated at a small fixed amount for every mile over you cover. Obviously, owning your own car means you aren’t restricted by any kind of mileage limit, however when you come to sell the vehicle, a high mileage may have an impact on how much you get for it.
4. Outright Ownership & Depreciation
When you lease a car through a Personal Contract Hire (PCH) or Business Contract Hire (BCH) agreement, you never at any stage own the vehicle or have any chance of owning it, as it’s simply returned once your lease term ends. With vehicle leasing, you essentially pay a monthly amount so that you can drive a new car, knowing it must be handed back at the end of the contract. This might be considered by some as a disadvantage, as you may feel like you’ve nothing to show for your money, however, when you lease a car rather than buy outright, you don’t have the worry of depreciation in value or having to sell the vehicle on when the time comes, plus you can swap make and model anytime you like with our short term car leases once you’ve completed the initial 28 days!
On average, new cars lose over half of their value within the first three years of ownership.
5. Vehicle Maintenance
With our short term car lease, maintenance is included as part of your lease contract, plus a manufacturer’s warranty comes with the car of your choice. Maintenance includes servicing, tyres and general fair wear & tear cover. We also include breakdown cover as part of the lease, so if the worst happens, help is on the way!
6. Road Tax
When you purchase a new car outright, you have to remember to tax your vehicle every year to avoid punishment but not when you lease a car from Flexed, as UK Road Tax is included in the price!
7. Tax Benefits
If you take out a Business Contract Hire (BCH) agreement for a new lease car or van, you can claim back 50% of the VAT if you’re VAT registered and if the vehicle is used solely for business purposes only, you can claim back 100% of the VAT at the end of your lease period.
No matter which option your choose, both leasing and buying have their advantages and disadvantages, so you must decide what’s best for you after weighing up the pros and cons for both. Whilst owning your own car gives you that feeling of actual ownership and being able to do what you want with it, leasing takes away a lot of the hassle that comes with outright ownership of a car – easy and affordable monthly payments, no worries about depreciation or having to sell the car on, access to a wide range of new cars that vary in price and style, flexible leasing for as long as you want, chance to swap vehicles as many times as you like, extras included in the price such as UK road tax, vehicle maintenance and breakdown cover.
Drop us a quick email to email@example.com or chat with a member of our team NOW using our online ‘We Are Here!’ service – we’ll gladly answer any leasing questions you may have.