Personal Car Leasing?

[moose73]

I have an HP agreement with BMW which will be paid of soon (with no missed payments etc) however since taking this out, my credit rating is now very poor due to a number of CC/loan defaults. These are being paid with payplan.

 

My question is that my car will be due for renewal as its now 7 years old with high milage, but would still be used for deposit.

 

What are my options? would BMW touch me now my credit history (not with them) is poor?

 

is personal leasing the way to go (does this require credit checks?)

 

don't want to secure anything against my house (wife wouldn't let me in any case) and no chance of getting a personal loan.

 

any ideas/comments?

 

Thanks

 

rob

[Jimbo44]

Hi Rob

 

I assume you're not thinking of getting a car through a business, whether it's you as a sole-trader, or in a partnership, or as a 'body corporate? If so what I'm about to say is irrelevant to you as leasing for those classes is a completely different ball-game. You're a private individual getting a car for your normal use?

 

Personal Leasing (or Personal Contract Purchase as some call it) is a variation of Hire Purchase. The reason the repayments are generally lower than 'conventional' HP is that, whilst the 'Guaranteed Future Value', (or Residual value, or whatever other term is used by the finance company concerned) is financed, it is not calculated into the monthly repayment but is repaid as a lump sum when the agreement ends. This 'repayment' happens when the car is sold, traded-in or whatever.

 

It's a virtual certainty that any finance company will do the usual credit checks before taking on any form of new agreement. That applies to PCP as much as HP. In view of what you say, my guess is that BMW finance could well be your best bet as they have a recent record of your 'performance' in making repayments.

 

Do beware though, if you consider any form of PCP plan, that the GFV will be governed to a large degree on the mileage you anticipate doing during the currency of the agreement.

 

Don't fall into the trap of under-estimating this as all you'll be doing is storing up a big bill for yourself. All PCP's I've seen have 'pence per mile' amounts built in for any miles in excess of the stipulated number when the agreement ends. Some of them are horrendous too!!!

[moose73]

yes, I was thinking of personal, however that maychange in April due to the budget, as I may have to start my own limited company up (due to the government trying to stop managed service companies i.e. contracting) but thats for the future.

[Jimbo44]

yes, I was thinking of personal, however that maychange in April due to the budget, as I may have to start my own limited company up (due to the government trying to stop managed service companies i.e. contracting) but thats for the future.

 

If that's the case, RJG, it might be worthwhile keeping your present car until April and then replacing it through the company if you set one up.

 

If you set up a personal lease agreement now you may end up kicking yourself come Apriltime.

 

Talk to an accountant regarding the possible tax benefits/pitfalls too.

[moose73]

got this from yourcarchoice. are they any good?

 

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Hi

Yes we can help with funding no matter what your credit rating is, I have attached our non status stock list, please have a look then give me a call and I will talk you through the options.

Regards

John Newland

yourcarchoice.com

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