Residual Car Purchase

[AmithS]

Hello All,

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

Thanks,

[Dave A]

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.

[AndyD]

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.

[wynn]

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.