[littleblackdog]

Those of you with a new F55 or F56, I have read that more than a few of you have had several previous Minis too, so I assume you all don't run them into the ground. Wondering what the breakdown is between buying (commitment!) and leasing (paying more for the privilege of being able to trade up sooner). I still have not bought one, worried that when I do, the next year's model will have fixed last year's itches, and put back a proper tachometer
Thanks for your input.

 

[kenl]

My f56 is the first car I have leased. I thought I would try this method as I replace my MINI every 2 or 3 years.
I think I will only really know when I come to trade it in.
I did though get £4.5k cashbook from trading in my last car which was nice!

 

[jeremybingham]

Ive done the same for the first time kenl, so much per month then optional final payment or swap the car. time will tell but this pcp thing does enable one to spend more money somehow! is that a dangerous trap mmmmmm! i certainly added the hk stereo and the leds because i could. Certain options seriously increase the px value too.
J

 

[kenl]

Some options do increase the guaranteed final value but you still lose more hard cash I would imagine.

 

[jeremybingham]

Oh yes definitely. You never get back the worth of the option. Can make it easier to sell though.mugs game really but it's great !

 

[radiocaf]

This is my first brand new car, and my first MINI, and I look forward to the 2 year mark when I should be phoned up to offer me a new car in exchange for my old one.

I was told the Media XL Pack and the CHILI Pack add the most value, but also the PEPPER Pack too.

Definitely going PCP (MINI Select) allowed me to add the extras, and next time I'll be more prepared and I'm hoping to be able to completely kit my next car out with everything. I couldn't afford LED Headlights and the Sunroof, but I could afford absolutely everything else I had to have.

I haven't started paying yet, but so long as I find I can cope with the extra outgoing each month, I'd recommend PCP to anyone, and I was once someone who was against it. I know when the new one comes out with new features, I'll be wanting some of those features, but knowing I'm in a PCP contract, I can just wait a couple years for the phone call and order another new MINI with those features included.

Also, the F55 has a proper tachometer, doesn't it? The left hand dial, the one without the screen?

 

[jeremybingham]

I'm sure it does,although I wondered if it was the shape he didn't Like? I've come to the same view as you 're pcp. never considered it. now sold(ha) on it.is that what they do even on a 4 year term. Don't know if I'll want to part with jasper in 2yrs!

 

[AVP]

Hello.

I'm on PCP. We had agreed my spec and monthly payments, but when I went back to add Rear Sensors & Black Stripes the monthy payment went down because of it. Go figure. Added value they said....should of done more!

 

[littleblackdog]

Thanks, so far sure seems like most everyone is leasing (if I understand that is what PCP is).

My comment re: the tachometer is because I love the big one on my R56, don't even look at the speedo except for the digital, drive manual and find it extremely useful.

Hubbie doesn't approve of leasing, we have never leased a car and tend to keep them for 10 years, but I may have to overrule him in this instance. Will talk to the salesman soon to see what the deal is.

Is PCP the Chili Package? Sorry, trans-Atlantic terminology discrepancy is what I am thinking.

 

[Shigaman]

Littleblackdog, PCP stands for Personal Contract Purchase - a relatively new way for people to buy new cars. There was an interesting article in The Guardian last year that explained how PCPs have been behind a new-car boom in the UK, even in times of general austerity and when the market for new cars in other parts of Europe has been sluggish in comparison. I'm in Japan and have bought my own F55 this way.
Here's how that article explains the attraction of PCPs:
"PCP is a flexible form of hire purchase, a bit like part-buy, part-rent home-buying schemes. Customers pay a deposit for a new car and then a monthly sum over a fixed term, usually three years, which covers interest and the depreciation of the car. Unlike hire purchase, customers are not committed to buy the car at the end of the contract; unlike leasing, which is a rental agreement, they have equity in the car and can buy it outright by paying the "guaranteed future value" of the vehicle agreed at the start of the term. What usually happens is the customer uses the equity in their car for another deposit and starts another three-year deal with the same dealer. Dealers love it because it encourages repeat business and consumers appear unconcerned about fully owning a car."
The full article is here
http://www.theguardian.com/money/2013/oct/08/why-britain-cant-stop-buying-new-cars

 

[siriuszero]

Interesting...sounds a lot like how a lease in the US works, at least from what I've gathered. What is the difference between this and leasing for you?

In the US, a lease is basically financing the depreciation of the car for a set term. The car is given an estimate of what it's worth after the term, adjusted for mileage, this is called the residual. There is also an agreed upon price if you'd like to purchase the car at the end of the term.

The advantages here are that you can either trade the car for another or walk away at the end of the term.

Disadvantages are that you do not own the car, there are mileage restrictions, and they usually require money upfront in the form of down payments or fees, though some can be negotiated down or eliminated.

 

[littleblackdog]

Thank you Shigaman for the well worded explanation and link, very helpful! I do have to do some more legwork to understand, as Siriuszero says, how our leases work compared to that.

 

[Shigaman]

Hello again - I think that from what Siriuszero says, "leasing" in the US seems to be very similar, if not the same, as the PCP. My understanding is that in the UK traditional "lease" agreements were no more than extended car rental plans with no element of accumulating ownership and usually no option to buy at the end of the lease (but I'm sure there have always been all sorts of variations on this).

 

[rix]

Hello again - I think that from what Siriuszero says, "leasing" in the US seems to be very similar, if not the same, as the PCP. My understanding is that in the UK traditional "lease" agreements were no more than extended car rental plans with no element of accumulating ownership and usually no option to buy at the end of the lease (but I'm sure there have always been all sorts of variations on this).

Quite right... A lease in the uk is usually described as Personal Contract Hire (PCH) when designed for consumers, or BCH when designed for businesses. The systems are identical except VAT is normally included in the quoted PCH costs but excluded from BCH (because a business can normally claim the VAT back. The costs are normally described as the amount of 'deposit' plus monthly payment, eg 6+23 so for exampoe the deposit could be 6x£250 (=£1500) + 23 monthly payments of £250. The agreed mileage I'll by built into the terms, eg 10k per year, with a nominal surcharge for each mile over the agreed limit. The 'deposit' is a bit of a misnomer as you don't get it back at the end of the term, its just an upfront payment. A PCH has no option to buy built in to the deal (although many lease companies will give youbfiret refusal at the end) so you are not accumulating any equity in the car. A PCH is good as a fixed cost way of using a car. Bear in mind that at the end of the term you'll have to find another chuck of money for a deposit on a replacement car, however the monthly payment tends to be less than on PCP.

 

[jeremybingham]

Interesting...sounds a lot like how a lease in the US works, at least from what I've gathered. What is the difference between this and leasing for you?

In the US, a lease is basically financing the depreciation of the car for a set term. The car is given an estimate of what it's worth after the term, adjusted for mileage, this is called the residual. There is also an agreed upon price if you'd like to purchase the car at the end of the term.

The advantages here are that you can either trade the car for another or walk away at the end of the term.

Disadvantages are that you do not own the car, there are mileage restrictions, and they usually require money upfront in the form of down payments or fees, though some can be negotiated down or eliminated.

This is how my UK pcp works.

 

[jeremybingham]

Sorry rix missed your post so repeated you.my dealer seemed to imply that the gteed final value is conservative and you'd have more to give you a deposit but who knows . We're saving to pay it off!

 

[kenl]

Yes, the final payment should be less than the actual value of the car. That way you have a deposit towards the next car.

 

[radiocaf]

I'm sure it does,although I wondered if it was the shape he didn't Like? I've come to the same view as you 're pcp. never considered it. now sold(ha) on it.is that what they do even on a 4 year term. Don't know if I'll want to part with jasper in 2yrs!

Well the manager who was sorting all the final stuff out, and the dealer himself, both mentioned me being called in two years to two and a half years time to bring in the car for a brand new one. They did use the term "might" so I imagine it's likely to happen unless everyone suddenly doesn't want 2-year old MINI's and they end up with a surplus they can't shift?

Hello.

I'm on PCP. We had agreed my spec and monthly payments, but when I went back to add Rear Sensors & Black Stripes the monthy payment went down because of it. Go figure. Added value they said....should of done more!

Oh wow, really? I added them by default, kinda interested as to how much I've saved.

What is the difference between this and leasing for you?

That sounds EXACTLY what PCP is over here.

The easiest way for me to explain it is after deposit, what you owe on the car is split, one part becomes your finance, which you pay off monthly during the contract, the rest is the Estimated Final Value. At the end of the contract, you can either use the car as deposit to get another new car, hand the car back, or pay the Estimated Final Value and then the car is yours.

So if you buy a car for £20,000, pay £5,000 deposit leaving £15,000 left, that £15,000 is split, where you pay finance on £10,000 over the duration of the contract, and the remaining £5,000 is deferred to the end of the contract.

Most people on PCP contracts get a phone call from their dealer when the car is at it's highest market value for used cars (usually 2 years), offering them another brand new car in exchange for their old one. The owner gets a brand new car, the dealer makes money both on what you paid for the car whilst you had it, and on what they sell it for to the next buyer.

The only other options are finance (or hire purchase), where you pay the entire balance (less a deposit) over monthly payments, with no final payment at the end to pay and no mileage restrictions. Your monthly payments are usually higher because a chunk of what you owe is not deferred till the end of the contract.

The final option is leasing, where you hire the car for as long as you want, but don't have any ownership/responsibility of it. The bonus of this is if you don't want to worry about servicing and repairs, the dealer has to pay for these as the car belongs to them.

Yes, the final payment should be less than the actual value of the car. That way you have a deposit towards the next car.

I actually did not know that. That's awesome. I plan on saving up as much as possible over the time I have this car so if and when they call me back to swap for a new car, I'll have a massive deposit.

 

[siriuszero]

Well the manager who was sorting all the final stuff out, and the dealer himself, both mentioned me being called in two years to two and a half years time to bring in the car for a brand new one. They did use the term "might" so I imagine it's likely to happen unless everyone suddenly doesn't want 2-year old MINI's and they end up with a surplus they can't shift?



Oh wow, really? I added them by default, kinda interested as to how much I've saved.


That sounds EXACTLY what PCP is over here.

The easiest way for me to explain it is after deposit, what you owe on the car is split, one part becomes your finance, which you pay off monthly during the contract, the rest is the Estimated Final Value. At the end of the contract, you can either use the car as deposit to get another new car, hand the car back, or pay the Estimated Final Value and then the car is yours.

So if you buy a car for £20,000, pay £5,000 deposit leaving £15,000 left, that £15,000 is split, where you pay finance on £10,000 over the duration of the contract, and the remaining £5,000 is deferred to the end of the contract.

Most people on PCP contracts get a phone call from their dealer when the car is at it's highest market value for used cars (usually 2 years), offering them another brand new car in exchange for their old one. The owner gets a brand new car, the dealer makes money both on what you paid for the car whilst you had it, and on what they sell it for to the next buyer.

The only other options are finance (or hire purchase), where you pay the entire balance (less a deposit) over monthly payments, with no final payment at the end to pay and no mileage restrictions. Your monthly payments are usually higher because a chunk of what you owe is not deferred till the end of the contract.

The final option is leasing, where you hire the car for as long as you want, but don't have any ownership/responsibility of it. The bonus of this is if you don't want to worry about servicing and repairs, the dealer has to pay for these as the car belongs to them.



I actually did not know that. That's awesome. I plan on saving up as much as possible over the time I have this car so if and when they call me back to swap for a new car, I'll have a massive deposit.

All interesting! Thanks guys!

We do not have that PCH plan. If you're financing, it's either a lease (similar to your PCP plan) or a standard fixed term loan. Some states also have MINI Select, which is kind of a hybrid of the two. You have a fixed term loan, but the loan is only for a portion of the car, like a lease. At the end of the term, you have a "balloon payment", which you are responsible for. You can either pay this amount off, refinance it into a fixed term, or if you have equity (which you usually don't) you can trade it in. The big difference between this and a lease is you own the car and can do whatever you want with it at any point in the loan.

You get lower payments than a fixed rate loan, but you have to be careful about the balloon. I did this on my Countryman and I have been paying extra on every payment so now, my term is almost up and I'm trading in, but I have a decent equity in my car I'll use as a deposit into a lease on my F55.

 

[radiocaf]

All interesting! Thanks guys!

We do not have that PCH plan. If you're financing, it's either a lease (similar to your PCP plan) or a standard fixed term loan. Some states also have MINI Select, which is kind of a hybrid of the two. You have a fixed term loan, but the loan is only for a portion of the car, like a lease. At the end of the term, you have a "balloon payment", which you are responsible for. You can either pay this amount off, refinance it into a fixed term, or if you have equity (which you usually don't) you can trade it in. The big difference between this and a lease is you own the car and can do whatever you want with it at any point in the loan.

You get lower payments than a fixed rate loan, but you have to be careful about the balloon. I did this on my Countryman and I have been paying extra on every payment so now, my term is almost up and I'm trading in, but I have a decent equity in my car I'll use as a deposit into a lease on my F55.

That MINI Select is exactly what our PCP is. I didn't, however, know you could overpay to build up equity... That's interesting to know!