Financing a Car

[weemster]

Hi All,

I know there have been a few posts regarding this subject.

I would like to finance a car. I don't really want to own the car. Intended term of 2 or 3 years with a annual mileage of 10k. Its basically a choice between Contract Hire OR Contract Purchase either through the Company OR Personal - I would be very interested to hear from other people about their experiences/ideas/considerations etc.

[threaded]

Don't! It is way cheaper to buy it outright and then sell it in a few years. Also if the car or dealer gives you any trouble it is way easier to get things sorted. There is nothing worse, even career threatening, than being saddled with a lemon for the whole contract term.

Consider this: if your bank won't lend you the money wonder why anyone else would! Contract Hire and Contract Purchase are only ways of making you pay a higher interest rate.

If you do decide that it has to be one or the other, go Contract Hire. BUT do make sure it really is Contract Hire. I know of one major group that regularly cons unsuspecting customers by giving them paperwork that purports to be Contract Hire when in reality it is Contract Purchase.

threaded in "cash is king" mode

[ratewhore]

As I've said each time this question has come up; my accountant (well known contractors accountant) told me that when you run the business, there is not much between buying/leasing yourself or through the company, particularly when you take into account servicing, insurance etc.

I have a hybrid car contracted through the business and when you look at just the leasing figures, theres very little difference in it either way. As I don't want to own a depreciating asset, I took the company lease route. And of course, because it's a hybrid, I get reduced personal tax liability on it...

[tim123]

As I've said each time this question has come up; my accountant (well known contractors accountant) told me that when you run the business, there is not much between buying/leasing yourself or through the company, particularly when you take into account servicing, insurance etc.

I have a hybrid car contracted through the business and when you look at just the leasing figures, theres very little difference in it either way. As I don't want to own a depreciating asset, I took the company lease route. And of course, because it's a hybrid, I get reduced personal tax liability on it...

And as I've said before (but perhaps not here), how does your company owing it shield you from the depreciation?

tim

[Gibbon]

If you're doing 30K + miles a year buy on HP. Once you have paid 1/2 the repayments and your/their car's value is less than the oustanding balance then you can hand it back. I have twice, it is in clause writen into the 1974 credit agreement act. I even had the same company offering me more car finanice.

[ratewhore]

And as I've said before (but perhaps not here), how does your company owing it shield you from the depreciation?

tim

it's a lease...