wyliss Posted January 4, 2008 Report Share Posted January 4, 2008 My wifes company car is due to be handed back in April and we have two choices. They are either opt into the company car scheme (she gets £210 p/mth to use and to be honest by the time we add on the Masterlease maintenance fee the cars available are real poor and small) or they give her an interest free loan of £5k and she has to go it on her own with an additional loan she has to take out herself. We have just been on the Fords of Winsford site and for example we have seen a Volvo S40 54 plate for £10k, the thing is how can we approximate its value in 2 years time when its time for a change?, we dont want to purchase a car thats going to be worth less than £6.5k in 2 years time as we would owe £1.6k to the finance company for her loan and also the original £5k back to the company she works for. Any help appreciated. Link to comment Share on other sites More sharing options...
shark_90 Posted January 4, 2008 Report Share Posted January 4, 2008 Can you use the £5k loan to pay payments on a PCP type agreement? i.e. you pay x amount per month for 24 months at which time it goes back to the dealer? Link to comment Share on other sites More sharing options...
gizze Posted January 5, 2008 Report Share Posted January 5, 2008 If you get £210 a month that is £163 take home at 22% or £126 at 40%. So not much of an allowance really. However at least it is £163 or £126 you are getting, an interest free loan means she gets sod all. It is just a loan. if you borrowed the £5k over 2 years you at 7% the interest would only be £272 anyway. You have that in the company car opt out after 2 months. You sure you have got the what they are offering you correct?? You sure they aren't offering you £5k over a set period rather than £5k as an interest free loan?? £210 over a year is £2500, I would think they are offering £5000 paid over two years towards a car?? If not then take the opt out plan, the loan is a joke! £10000 over 3 years with a final value of £5000 will be roughly £270 a month. But I would get the offer sorted first as it doesn't make sense as it stands, you are being offered £5000 over 2 years with the first over and £272 over 2 years with the second offer. Link to comment Share on other sites More sharing options...
gizze Posted January 5, 2008 Report Share Posted January 5, 2008 Or are they offering to put in £5k with no charge? on the understanding that the £5k is to be repaid at the end of the term or when she leaves?? Link to comment Share on other sites More sharing options...
wyliss Posted January 7, 2008 Author Report Share Posted January 7, 2008 Thats spot on Gizze. The 5K loan off her company has to be repaid if she leaves the company or decides to opt back into to the company scheme, if she opts out she gets the 5K loan and about £210 per month to purchase her own car. The monthly amount is the same if she decides to stay in the company scheme. We are going to get a price off Masterlease today or tom for a Nissan Qashqai opting into the scheme and will compare that price with a quote off contracthire&leasing.co.uk for same. Only difference here is that you have to pay for your own insurance etc. I suppose opting into a co car scheme is the hastle free way really but as ever its also the cost. Link to comment Share on other sites More sharing options...
wyliss Posted January 7, 2008 Author Report Share Posted January 7, 2008 The 5K is only an interest free loan from her company to put towards a car purchase, if she decides to leave or opt back into the scheme she would still have to pay it back. I suppose what you could do is put that into a high interest account and let it sit there and use the monthly allowance (£210 plus maybe a contribution from us) for the PCP. We are doing a bit more research on this over the following week so knowing what women are like types of car/age may change. We looked at a Nissan Qashqai on PCP and that worked out at approx £200 +vat p/mth 3+24 period but we have to get our own insurance which for my wife would probably be around £50 per month. Will get a price for opting into the scheme off Masterlease later. Keep ya posted. Link to comment Share on other sites More sharing options...
gizze Posted January 7, 2008 Report Share Posted January 7, 2008 No, what you would do is buy a car that is 3 months old and has lost 25% off list take out a balanced lease purchase, and use the £5k as deposit, you would then set the balloon payment at £5k less than you would have if you had not had it, meaning when you sell the car you get the £5k back to give to the employer or roll onto the next car. Say you buy a Nissan Qashqai at 3 months old for around £13k. You put the £5000 in as a deposit take a balanced lease payment loan out over 24 months with a balloon at the end of £3000, this is £250 a month. The car should be worth £8k as a minimum, meaning you pay off the £3000 owing and get your £5k back, if the car is worth more you get some more back in your pocket. No point earning interest on the £5000 at 3 maybe 4% if you have a loan costing you anything from between 8-12%. Link to comment Share on other sites More sharing options...
gizze Posted January 7, 2008 Report Share Posted January 7, 2008 Personally I would rather buy an X3 2.0 diesel on an 05 plate, you can get them with 20k miles on them for £14-15k if you shop around. Put the £5k in, pay £255 a month with a balloon of £5000, in 2 years time that will get £10k all day long if it has less than 60k miles on it. Link to comment Share on other sites More sharing options...
wyliss Posted January 7, 2008 Author Report Share Posted January 7, 2008 Thanks for all the info Gizze. As you can tell I am new to the leasing stuff, whats actually are balloon payments and balanced lease plans? Is there a website which may explain all this to me? Cheers Link to comment Share on other sites More sharing options...
shark_90 Posted January 7, 2008 Report Share Posted January 7, 2008 [ QUOTE ] Personally I would rather buy an X3 2.0 diesel on an 05 plate, you can get them with 20k miles on them for £14-15k if you shop around. [/ QUOTE ] You'd buy an X3? Link to comment Share on other sites More sharing options...
garcon magnifique Posted January 7, 2008 Report Share Posted January 7, 2008 Call it opinion if you like, but I think anyone who buys an X3 should automatically be banned from any kind of car enthusiast forum. The X3 is an anti-car. Link to comment Share on other sites More sharing options...
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