Discussion
Folks
Have mates who have recently sourced decent lease deals on new and second hand cars / motor bikes / boats etc - all for weekend toys !
Is there any lease deals out there for classic cars or is it a stupid question as I have never seen any leases mentioned in all the various forums and classic magazines ? [ maybe something to do with not being able to calculate depreciation I wonder ? ]
Thanks
Brian
Have mates who have recently sourced decent lease deals on new and second hand cars / motor bikes / boats etc - all for weekend toys !
Is there any lease deals out there for classic cars or is it a stupid question as I have never seen any leases mentioned in all the various forums and classic magazines ? [ maybe something to do with not being able to calculate depreciation I wonder ? ]
Thanks
Brian
dram said:
Folks
[ maybe something to do with not being able to calculate depreciation I wonder ? ]
Thanks
Brian
I think you hit the nail on the had there. In order for it to work for the finance company, they need to offset the depreciation costs. I guess any classic has done as much depreciating as its ever going to do. [ maybe something to do with not being able to calculate depreciation I wonder ? ]
Thanks
Brian
What sort of classic are you after? I might consider leasing the Healey!
I can't see any reason why a classic lease arrangement wouldn't work, it would be arranged like a comtemporary lease with mileage limits and condition restrictions for the car on its return (i.e. failiure to return it in such as condition would result in damages being charged for etc). In some ways the commercial logic behind leasing is better as the values are potentially more stable. There would be restrictions making sure the car was serviced annually and suitably maintained etc.
I can't see any reason why a classic lease arrangement wouldn't work, it would be arranged like a comtemporary lease with mileage limits and condition restrictions for the car on its return (i.e. failiure to return it in such as condition would result in damages being charged for etc). In some ways the commercial logic behind leasing is better as the values are potentially more stable. There would be restrictions making sure the car was serviced annually and suitably maintained etc.
Leasing (contract hire)companys make some of thier revenue reclaiming VAT (new vehicles) this doesnt apply to used cars so the usual route for a used car is PCP (personal contract purchase) where a baloon rental is offset for 3 years.
For a company to set this up would require extensive indepth knowledge of the classic car market and unless very very wealthy would have to present a credible business plan to a bank!!
The banks are no longer keen on investments that may leave them with risky depreciating hard to dispose of assests.(fingers burnt)
For a leasing company to make this work they would have to charge around £200-£300 pcm for a £10,000 investment depends on Vehicle Residual Value and Risk. A 5 year loan will cost £200 so why not just buy one?
If you want a boat you can get a 10 year mortgage through specialist marine finance brokers.
For a company to set this up would require extensive indepth knowledge of the classic car market and unless very very wealthy would have to present a credible business plan to a bank!!
The banks are no longer keen on investments that may leave them with risky depreciating hard to dispose of assests.(fingers burnt)
For a leasing company to make this work they would have to charge around £200-£300 pcm for a £10,000 investment depends on Vehicle Residual Value and Risk. A 5 year loan will cost £200 so why not just buy one?
If you want a boat you can get a 10 year mortgage through specialist marine finance brokers.
Thanks Guys
Agree with all your comments...
Speaking to a few other guys there is a definite customer base and interest for this type of classic ownership [ same as motor bikes / boats etc..]however all very much dependant on maintaining the condition of the vehicle is the bottom line..
In the work I'm in you can lease any piece of plant or kit - new or second hand - compared to a few years ago - the accountants are encouraging this in business.
Lease deals are bound to be introduced for classics some day..
Regards
Brian
Agree with all your comments...
Speaking to a few other guys there is a definite customer base and interest for this type of classic ownership [ same as motor bikes / boats etc..]however all very much dependant on maintaining the condition of the vehicle is the bottom line..
In the work I'm in you can lease any piece of plant or kit - new or second hand - compared to a few years ago - the accountants are encouraging this in business.
Lease deals are bound to be introduced for classics some day..
Regards
Brian
You and your mates could club together and join http://www.cccedinburgh.co.uk/
That way you'll get lots of points, and what do points make...?
...the use of lovely classic cars all maintained by the club.
That way you'll get lots of points, and what do points make...?
...the use of lovely classic cars all maintained by the club.
In the work I'm in you can lease any piece of plant or kit - new or second hand - compared to a few years ago - the accountants are encouraging this in business.
Accountants like leases will cause they are very tax efficient. I dont think the inland revenue will regard a classic car as a legitimate business expense. Unless of course you rent them to a 3rd party or maybe use them to promote your business.
A private individual on PAYE cannot take advantage of "business tax breaks"
Chard
Accountants like leases will cause they are very tax efficient. I dont think the inland revenue will regard a classic car as a legitimate business expense. Unless of course you rent them to a 3rd party or maybe use them to promote your business.
A private individual on PAYE cannot take advantage of "business tax breaks"
Chard
Have you considered buying a classic car with a few mates?
I've done it in the past with an s1 Elise and it worked really well.
All needs to be formally documented and you need a contract of sorts which everyone agrees to. As long as nobody tries to take the pi$$ (which is what the contract is there for) it can work out nicely for all involved.
I've done it in the past with an s1 Elise and it worked really well.
All needs to be formally documented and you need a contract of sorts which everyone agrees to. As long as nobody tries to take the pi$$ (which is what the contract is there for) it can work out nicely for all involved.
Back in 2006 I wrote a HP deal for a 1924 - something, it might have been a Bentley. It was bloody expensive whatever it was. I'm a finance broker BTW.
It had a business use - sort of - the guy had a wedding business and it was mentioned that it may become a wedding car, but I seriously doubt it ever saw a blushing bride.
Truth is whilst I claimed it as a depreciation-proof asset and only subject to movement in the classic car market, the finance company valued it at £0 because no valid values were available.
They did it purely on the strength of the client and his business and it was very touch and go and took an age to get done.
In this market you'd stand less than zero chance of funding it like that.
Best you could hope for would be personal loan (rarer than a rare thing for meaningfull amounts) or secured against property or large assets on a chatel basis.
It had a business use - sort of - the guy had a wedding business and it was mentioned that it may become a wedding car, but I seriously doubt it ever saw a blushing bride.
Truth is whilst I claimed it as a depreciation-proof asset and only subject to movement in the classic car market, the finance company valued it at £0 because no valid values were available.
They did it purely on the strength of the client and his business and it was very touch and go and took an age to get done.
In this market you'd stand less than zero chance of funding it like that.
Best you could hope for would be personal loan (rarer than a rare thing for meaningfull amounts) or secured against property or large assets on a chatel basis.
Guys
Thanks again ..food for thought for next Spring !
Lefty Guns
How you doing ! Am enjoying the whisky forum...
I think the route for quality classic car ownership is probably not leasing but to 'car share' same as some mates are doing with the weekend boat that they have - instead of a small boat each they have all contributed towards a decent sized cruiser and share running costs and it's surprising how cheap that becomes ... I appreciate that it needs to be formally signed up etc..
Cheers
B
Thanks again ..food for thought for next Spring !
Lefty Guns
How you doing ! Am enjoying the whisky forum...
I think the route for quality classic car ownership is probably not leasing but to 'car share' same as some mates are doing with the weekend boat that they have - instead of a small boat each they have all contributed towards a decent sized cruiser and share running costs and it's surprising how cheap that becomes ... I appreciate that it needs to be formally signed up etc..
Cheers
B
dram said:
Guys
Thanks again ..food for thought for next Spring !
Lefty Guns
How you doing ! Am enjoying the whisky forum...
I think the route for quality classic car ownership is probably not leasing but to 'car share' same as some mates are doing with the weekend boat that they have - instead of a small boat each they have all contributed towards a decent sized cruiser and share running costs and it's surprising how cheap that becomes ... I appreciate that it needs to be formally signed up etc..
Cheers
B
Cost/Use sharing is pretty popular for light aircraft too I think. Thanks again ..food for thought for next Spring !
Lefty Guns
How you doing ! Am enjoying the whisky forum...
I think the route for quality classic car ownership is probably not leasing but to 'car share' same as some mates are doing with the weekend boat that they have - instead of a small boat each they have all contributed towards a decent sized cruiser and share running costs and it's surprising how cheap that becomes ... I appreciate that it needs to be formally signed up etc..
Cheers
B
I'm not an accountant but...
what if you stuck it on the mortgage?
Rates are very low. You borrow the value of the car against some of the equity in the house. Drive the car around and look after carefully. After a fixed number of years sell the car, hopefully for about what you payed for it, and pay a chunk of the mortgage. Obviously you will have paid interest but you would expect that with a lease.
I am prepared for you to explain why this won't work!
what if you stuck it on the mortgage?
Rates are very low. You borrow the value of the car against some of the equity in the house. Drive the car around and look after carefully. After a fixed number of years sell the car, hopefully for about what you payed for it, and pay a chunk of the mortgage. Obviously you will have paid interest but you would expect that with a lease.
I am prepared for you to explain why this won't work!
in fact a quick google of 'classic car leasing' finds http://classiccarleasing.com/
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