Hire purchase vs leasing vs PCP for dummies

[KaraGUK]

Sorry for my super basic question but would anyone be able to simply explain the different options for getting my hands on a Tesla? I have experience of hire purchase but not PCP or leasing. How do I work out the costs of each and are there go to places for the best rates? Thanks in advance!

 

[AndrewR]

If you go through Tesla finance which is done by Black Horse you'll be 4.9% APR.

Between HP and PCP this article gives a good overview - PCP vs HP – what's the difference?

With a lease, you do deposit and monthly payments, but then have to give the car back at the end. Tesla only offers PCP or HP directly, lease you have to go through a 3rd party.

Another option is to finance the car yourself with a basic loan or try to arrange your own PCP/HP agreement.

 

[KaraGUK]

Thanks Andrew. I am torn between am PCP Iand hire we as may need a bigger car in 3 years. I am trying to work out if I took the PCP option and saved the difference in monthly costs vs hire when it came to the end of the PCP contract would the money I saved pay off the car? From reading the article it seems to be dependent on the future value of the car. Is that correct?

 

[NorfolkMustard]

With PCP and HP you have an asset to trade, think of PCP like HP but back-loaded (the big (optional) final payment)

Think of a lease as a long-term hire car, you don’t own it but are liable for the full term agreed

 

[AndrewR]

Thanks Andrew. I am torn between am PCP Iand hire we as may need a bigger car in 3 years. I am trying to work out if I took the PCP option and saved the difference in monthly costs vs hire when it came to the end of the PCP contract would the money I saved pay off the car? From reading the article it seems to be dependent on the future value of the car. Is that correct?

Yes, the major difference is backloading on PCP, you need a smaller deposit but then that becomes the optional balloon payment at the end. In terms of what is best for you, only you can make the decision!

 

[KaraGUK]

Thanks that is really helpful! Looking forward to driving a model 3 soon!

 

[Watts_Up]

Sorry for my super basic question but would anyone be able to simply explain the different options for getting my hands on a Tesla? I have experience of hire purchase but not PCP or leasing. How do I work out the costs of each and are there go to places for the best rates? Thanks in advance!

I was reading from another thread that you should be careful with your initial deposit, in case your car get totaled,
as in the majority of cases, you will not receive any money back from the initial deposit.
The OP recommended to have $0 deposit and full payment of the lease as first payment,
and return the car at the end of the lease, or get a new lease with the same conditions if the car get totaled.

 

[Andywil]

Sorry for my super basic question but would anyone be able to simply explain the different options for getting my hands on a Tesla? I have experience of hire purchase but not PCP or leasing. How do I work out the costs of each and are there go to places for the best rates? Thanks in advance!

You will not save money on PCP Vs lease. Lease payments are less per month than PCP simply because you are only basically paying the depreciation.