During the course of our lease deals and transactions, some of the queries which are quite common include questions related to the “initial rental”.
As in this instance, our customer was receiving a company car allowance from his employer, a local estate agent and as such they wanted to avoid any big initial rental style deals…
The prices advertised on our website are based on a 6-spread initial rental, which means that if you are looking at a monthly rental of £300 inc Vat, the initial rental would be £1800.00 inc Vat (i.e. £300 x 6)
The initial rental is not a deposit and so this is not an amount that you would receive back at the end of the agreement.
Additionally, unlike a PCP-style agreement, the amount of initial rental does not influence the overall cost as this is not an interest-led product.
Whether you make a big or small initial rental, the price you pay across the term is relatively equal; it is merely about structuring a deal which is based on your individual requirements.
As we work alongside a select number of finance companies, each has a different approach as to when the initial will be taken.
In most cases, you can expect the sum to be taken by direct debit within 7-14 days AFTER delivery. In a minority of cases, the finance company will take this either shortly before or on the day of the delivery.
In any case, do ensure you have enough money within your bank account to discharge this obligation sensibly.
For more information on no deposit leasing or low initial rentals check out this article in our help and advice section, or simply get in touch with a member of our helpful team who will happily walk you through some options and best deals currently available.
