Car leasing can be confusing, but it shouldn’t be!
There are so many terms thrown around in the leasing industry sometimes that even we (the experts!) forget what they mean. So, we’ve decided to write a quick guide to hopefully answer some questions helping to make the whole leasing journey easier.
Some lease deals you may see online are advertised as ‘Business’ only. Meaning that you would have to be any of the following below to qualify for the lease.
Limited Company (LTD)
Limited Liability Partnerships (LLP)
However, if you’ve found the perfect deal but you’re not a business, just give us a call! We’ll be able to find you something similar.
Contract hire has the same definition of what is considered a normal lease. It just depends on which leasing company you visit, as people will refer to the same thing with a different name.
As you technically ‘hire’ a vehicle for a contracted period of time, this is where the name has naturally come from.
View our latest contract hire offers here.
The contract term just refers to the total length of the contract. This is normally displayed as months or years, depending on how and where it’s advertised.
Car leasing contracts tend to normally range between 24-48 months. However, if you are looking for something shorter, you could always check out our friends over at Flexed!
Fair Wear and Tear
When driving on UK roads, it’s inevitable that your car will have normal age-related and road use marks. Such as stone chips and minor scratches. So most lease agreements will have some sort of standard fair wear and tear guide.
Meaning that if there is damage to the vehicle, which doesn’t exceed their limits it won’t be chargeable. However, before entering your lease contract it’s always best to check what these limits are.
Prior to the return of your vehicle, you can always call your funder to pre-inspect your car before collection. Allowing you to have time to rectify anything to avoid or mitigate your end of lease charges.
The funder is the company that is behind the buying, selling and managing the contract of your lease vehicle. These will often be the vehicle’s registered owner, meaning your monthly payments will be paid towards them.
At the end of the contract, most funders will contact you to arrange the collection of your vehicle but will not necessarily arrange a replacement. To quote on your next lease, just give us a call directly.
Maintenance and Service
Maintenance and service are required for the general upkeep of the car. The longer you have a car, the more likely it is for things to start need replacing (like tyres). All cars will also require a full service at some point, which involves changing its oil and filters etc. Ensuring that the car continues to run at a high standard.
You can actually include your maintenance and service into your monthly lease rental. Just speak to a member of our team to find out more.
MPA (miles per annum)
Most lease deals will have some sort of mileage limit in place. As the vehicle funder will have based the lease quote roughly on what the car’s expected mileage will be at the end of the contract. So you will often see monthly rentals advertised with the mileage limit and the contract term together.
The contract mileage is normally broken into yearly amounts. For example, you’ll often see something like 10,000 MPA. Which is equal to 10,000 miles per year. Giving you a guide as to how many miles you’re allowed in your contract.
However, it’s worth noting that the mileage at the end of your contract is based on the total amount of miles the car has travelled. So if you go slightly over in your first couple of years, you will always have that option to recoup the mileage in the final year.
The payment profile of a lease contract is the way the payments have been structured. Generally, lease offers are made up of 3, 6, 9 or even 12 equally monthly payments are made up front. The number after signifies the number of monthly payments remaining.
For example, 3 + 35 payment profile is equal to 3 monthly payments up front followed by 35 monthly payments.
Typically, the more you put up front the cheaper your monthly rental. However, the total amount payable throughout the contract remains about the same. It just depends how you prefer to structure your lease.
Personal lease deals are not that much different to what a business lease could offer. One of the only exceptions is that everybody is able to qualify.
It’s worth noting that most personal leases include VAT as part of the monthly rental. Which is a great way to determine whether or not that the offer you’re looking at is either a business or personal lease.
If you’d like your own personal quote today, call 01904 55 75 44 or email email@example.com today!