Deciding on the van that you lease comes about in many different ways, including the vans that your peers have, the local dealers, a make that you trust and in some cases, a van that is absolutely suited to you and is only provided by one manufacturer
Putting aside the terminology of leasing for a moment, that is covered in the blogs here and here. The terminology and lease types that apply to cars, apply to vans also. What I want to cover today is all those things which our account managers will need to know to tailor your lease to fit your requirements. He will ask you questions about annual mileage, your monthly budget, how long you want to lease a van for , do you want to own it at the end or give it back, how many miles a year you cover and do you want to include maintenance. In more detail:
1.Length of lease or how long you want the van for, normally this will be 2, 3 or 4 years and occasionally 5. Like most of the parameters, it is somewhat interactive and may change to bring it into line with your budget. Bear in mind that whatever time you choose, you will have the van for that period and if it runs past the manufacturer warranty period, is the saving sufficient to cover any repairs that would otherwise be covered by warranty? Conversely, at the start of each lease, you pay an initial payment, so you will end paying more in initial payments but will get a new van every two years
2.Your annual mileage will determine the total lease mileage allowance. Adhering to the annual mileage is not necessary but if you exceed your total lease mileage allowance, you will be charged at a pence per mile charge rate, this is laid out in both your quote and your documents. Your pence per mile is not a punitive charge, but normally proportional to your agreed charges. In agreeing your annual mileage, take a little extra, it is not expensive to have a few miles extra per year but means that if you should need to do some long journeys during your lease, it really is not a problem
3.Monthly rental or your monthly budget, just like the length of lease will vary to arrive at a length of lease that suites you and the van that you would ideally like. At this point in time, it is maybe worth having a look at your options when choosing a new van and how you can maybe have a van that will also be your family car at night and weekend. The blog <here> covered a number of vans that will carry your family and still be an excellent van. Remember when deciding on your monthly rental that your initial payment will be made up of either 3 or 6 times your monthly rental
4.Do you want to keep or give back your van at the end of your lease?. The end of your lease when you use contract hire is completely different to finance lease. At the end of your finance lease, you pay a final payment to keep the van and in this way you are not subject to condition punishments that you would be with contract hire. If you are a clean user of a van, say light delivery, then contract hire will suit you as the van will be handed back with less marks than those used by a builder, contact us at Vanlease and ask for the admin team.
5.Understand your lease Contained within any lease agreement are the additional mileage pence per mile and any break clauses that may exist subject to its type. At this stage, thoroughly read and understand your lease then keep it in a safe place
6. Optimise for tax this is what your accountant is for. When choosing your funding method/lease type, speak to your accountant and choose the most tax efficient lease. They will understand your business and will best answer this question
7.Confirm that you are happy with your initial payment. At Vanlease UK our vans are normally priced on contract hire with 3 payments in advance. But if because you prefer to have lower monthly payments or a shorter period you have asked for a larger initial payment, make sure that you have got this in writing and that it is exactly the same as your final quote
8. Maintenance Most vans that we supply have maintenance contracts. Knowing that your monthly payment is fixed and that it includes your regular servicing plus tyres makes it easier to budget your van costs. Additionally, regular maintenance improves your relationship with your local dealer should you have any issues.
9. Insurance If this is your first van, ensure that your insurance cover is completely suited to all uses that your business that will put the van to. Also, find out if you need to insure the cargo separately and check your excess on each policy
10. Early Termination Different funding methods end in completely different ways and similarly, extensions and early terminations are handled differently. Contact our admin team during your last six months of your contract and we can get all the options for you, we will contact you when you have six months of your contract left