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Car Ownership cost USA v UK

Car Ownership cost USA v UK

Old Nov 15th 2017, 12:32 am
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Default Re: Car Ownership cost USA v UK

Originally Posted by Nutek View Post
Yeah.. No.
Obviously we still have some work to do.
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Old Nov 15th 2017, 12:58 am
  #77  
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Default Re: Car Ownership cost USA v UK

Originally Posted by S Folinsky View Post
The "bimmer" "beemer" dichotomy strikes me as an affectation.
Allegedly it originates from Boston. ‘Nuff said.
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Old Nov 16th 2017, 10:41 pm
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Default Re: Car Ownership cost USA v UK

Originally Posted by Jaag View Post
i.e. compare two scenarios of a 36 month lease costing $12,600, where you total the car in month 3.

1) $9k down, $100/month - month 3 you have paid out $9,300. Insurance pays out the remaining $3,300 to end the lease (+FMV) to finance company
2) zero down, $350/month - month 3 you have paid out $1,050. Insurance pays out the remaining $11,550 to end the lease (+FMV) to finance company

The end result, is you're insured, everything is paid off, settled with the finance company etc, so "all is well", but the amount you've lost is very different.
In the UK under either scenario the insurance would pay out the value of the vehicle. (the cost of supplying a vehicle of similar age and condition)

In scenario 1, the vehicles value would (should!) be well above the $3,300 termination fee and you would get the difference, giving you some of the $9000 back.

In scenario 2, it should match the termination fee and you would get nothing (maybe a small + or -).

Doesn't insurance work the same way in the US?
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Old Nov 30th 2017, 7:35 pm
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Default Re: Car Ownership cost USA v UK

Originally Posted by richard42 View Post
...Doesn't insurance work the same way in the US?
I don't know TBH. But I did happen to come across this thread from LeeseHackr from a dealer that sums up the risks of paying a lease upfront;

"In essence, when a car is totaled, the depreciation risk of a one-pay lease is similar to that of a conventionally financed vehicle. The risk tends to be greatest during the first few months into a lease, when depreciation is steepest.

Say the car has a selling price of $40,000, a residual of $25,000, and a one-pay lease of $15,000. The car is totaled 2 months into the lease and insurance pays the market value of $36,000. You get the difference between the market value and residual ($11,000), which means you’ve paid $4,000 to drive the car for 2 months.

With a monthly lease, depreciation is divided evenly into monthly payments, and you can simply walk away from the lease if the car is a total loss.

Also, Honda is generally quite good with estimating residuals. The risks of a one-pay lease are higher on a car with inflated residuals. I’ve seen BMWs and Benzes where the market value equaled the residual value with months left on the lease – which would be bad if a one-pay lease car were totaled.

Hope this helps!"


Source: LeeseHackr : Chevy Bolt $150/month $0/down (CA)
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