Van leasing... Any good?

[TIMON]

We are looking into leasing a couple of vans.

Does anyone have any experience of this?

What are the advantages over simply taking a loan out? Etc...

[dig-dug-dan]

I have leased for the past twenty years. Its a no brainer buying outright from new, you lose too much money. Every lease payment is 100% tax deductable. You can buy the vehicle at the end or pay a peppercorn rent.

also leasing means the vehicle is under full warranty from new so if any problems, the lease company deals with it.

my advice is do not lease through a dealer. Always use an independant company you will get a much better deal

[hamdogg]

What's it like on scratches, damages, general wear and year? They sting you at the end don't they? And how would you go about putting a chip box on it etc

[richy_B]

It is very dependent on each company and person. I currently own outright but I am going to lease my next vehicle. What appeals to me is:

 

-A known monthly cost. Generally no surprises. This makes is easier for costing and cashflow. It is also a standard expense rather than a current asset with the capital allowance limitations so may help on your books. I believe the arrangement is the same for BIC.

-A brand new, warrantied vehicle. Looks professional, reliable, hopefully wont let you day losing days work/wasted staff time.

-Wear and tear vs cost. This is where it is very dependant on the individual circumstance but for me as an operator in London I generally only do 30-40 miles a day equating to about 9000 miles a year. This means I can lease something like a single cab ranger or rodeo for cheap (c.£160+VAT). Those 9000 miles will be stop start daily traffic, with 500kg+ in the bed and towing 2000kg+ of trailer. After three years although looking good externally I am sure mechanically it will be feeling it. At this point you just hand back the keys and get a new one. For anyone doing 20k plus mileage they will sting you.

 

A lot of people thinks leasing is dead money and with personal cars I'd probably agree but for commericals it makes sense to me. Horse for courses I guess.

[TIMON]

Thanks, we'll be doing a fair bit of mileage so we need to ask all the right questions when the rep comes on Friday to see us.

Any more thoughts or tips would be gratefully recieved.

Thanks

[Dean O]

I wouldn't buy new, the amount of depreciation is just eye watering.

 

I've bought at three years old, low mileage ex lease and been lucky (though not completely issue free), however I would say that I have formed the opinion from the experience of others - that commercials (particularly vans tippers etc.) are built to last three years - its almost like the manufacturers know that because leasing has become so popular - their offerings only need to last the period of their lease - and then once through auction can begin to fall apart.

 

I had the conversation with my accountant of should we be leasing - he didn't seem to think that it was overwhelmingly better than buying outright a nearly new second hand vehicle - my understanding is that it's depreciation as an asset is written off yearly in any case so it balances out...

 

I'm still tempted by leasing tho' particularly for the issues raised by ritchie_B

[hamdogg]

What sort of prices are we talking for say a tipper?

[nepia]

Thanks, we'll be doing a fair bit of mileage so we need to ask all the right questions when the rep comes on Friday to see us.

Any more thoughts or tips would be gratefully recieved.

Thanks

 

 

Check your mileage allowance and how much it will cost you to raise it; there is an end of lease excess mileage charge. I've just bought outright at the end of a 4-year lease and having exceeded my allowance slightly had to pay just over £400.

No complaints but if you're on an annual allowance of 14,000 miles as I was and you do 18,000 then 9p a mile excess is going to add up to a sizeable bill at the end of the lease that you may not have been ready for.

 

Also look at GAP Insurance; simply it covers the cost of outstanding finance if the vehicle is written off when worth less than any amount you owe on it.

[hamdogg]

What about scratches dintsxetc etc after you have it back?

[dig-dug-dan]

I wouldn't buy new, the amount of depreciation is just eye watering.

 

I've bought at three years old, low mileage ex lease and been lucky (though not completely issue free), however I would say that I have formed the opinion from the experience of others - that commercials (particularly vans tippers etc.) are built to last three years - its almost like the manufacturers know that because leasing has become so popular - their offerings only need to last the period of their lease - and then once through auction can begin to fall apart.

 

I had the conversation with my accountant of should we be leasing - he didn't seem to think that it was overwhelmingly better than buying outright a nearly new second hand vehicle - my understanding is that it's depreciation as an asset is written off yearly in any case so it balances out...

 

I'm still tempted by leasing tho' particularly for the issues raised by ritchie_B

 

if you keep it for 15 years, its worth it. otherwise a lease is more tax efficient