Residual Car Purchase

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  • AmithS
    Platinum Member

    • Oct 2008
    • 1520

    #1

    [Question] Residual Car Purchase

    Hello All,

    Are there any benefits to purchasing a car using the residual method as opposed to the normal loan type?

    Thanks,
  • Dave A
    Site Caretaker

    • May 2006
    • 22803

    #2
    It makes it easier for you to drive a car you couldn't really afford otherwise

    Probably easier to justify if you think of it as a rental. Just don't for a moment think that you actually own the car.
    Participation is voluntary.

    Alcocks Electrical Services | Alcocks Pest Control & Entomological Services | Alcocks Hygiene Services

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    • AndyD
      Diamond Member

      • Jan 2010
      • 4946

      #3
      As Dave said it's effectively leasing the car and purchasing it at the end of the agreement. I would be careful of how much the residual is at the end, it can be far more than the market value of the car at that time which would be a little depressing.
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      • wynn
        Diamond Member

        • Oct 2006
        • 3338

        #4
        Look at it this way;
        Under residual lease they buy the car and you pay for it, then they sell you the car and you pay for it. Simple?

        Rather lease a car for the business that way it all comes off tax and you get to use the car for half price.

        Oh and you don't have any maintainance costs.
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