Looking for your next car lease?
Before you do sign up to a new lease vehicle, make sure you know the basics of the leasing process so that you understand exactly what it is you are signing up for! Here are the 5 things you need to know before leasing a car online!
Specifically:
1. Contract hire – this is a fixed term contract for 2, 3 or 4 years (and anything in-between) to use a vehicle (car, van or minibus). You never own the vehicle (the registered owner will be the finance company – Lex, Leaseplan, Hitachi, Alphabet etc) and this is therefore classed as a “usership” style product. For customers who wish to purchase a vehicle, you need to consider other finance products as this is not suitable (i.e. hire purchase or PCP).
2. Annual mileage – this influences the price considerably. The lower the miles, the lower the depreciation of a vehicle AND therefore the lower the cost. The annual mileage you select must reflect what you actually cover per year (personally or business). If you return a vehicle with mileage that exceeds the contract, you will pay excess mileage. This is an amount of money shown as “pence per mile” on your order form/contract. This is only calculated at the end of the contract when the vehicle is returned to the finance company. Some finance companies may allow you to change the mileage up and/or down during the course of the contract.
3. Term – as highlighted above contact hire is generally organised on a 24, 36 or 48 month term. Some finance companies offer bespoke 18 month deals BUT anything lower is generally the reserve of car hire companies on “flexi-leases”. While the monthly rental is often cheaper when you take out a longer contract, you need to ensure you want the vehicle for that length of time. If you have a 48 month contract, are you comfortable having a vehicle beyond the vehicle warranty period? If you take a lower term, do bear in mind that some finance companies will expect the vehicle to be returned; you cannot always extend the contract. Also consider that a contract is fixed and the only way in which you can return the vehicle is go through an “early termination” process which involved paying half of the remaining rentals.
4. Maintenance – you have the option to maintain the vehicle yourself (driver-maintenance) or have this included (funder-maintained). Do not presume than all servicing, maintenance and tyres is included automatically with leasing a vehicle.
5. Insurance – this is never included with contract hire agreements. You must insure the vehicle yourself. Before you commit to a vehicle (especially for younger drivers) do ensure that you receive an insurance quotation.
When a customer contacts us and says “how much to lease that car”, you can see (when reading the above) why it is not possible to simply provide an easy quote.
To ensure everything meets the needs and requirements of a customer, we ensure that each quotation is created bespoke to the customer.
Leasing a vehicle is a commitment; the team want to ensure this is correct for them.
