What car leasing is
It’s a little more complicated than this, but in its simplest form, leasing is effectively paying for the use of a car over a fixed period of time as opposed to actually buying the vehicle. It is also known as “Contract hire”.
Whereas if you bought a car outright, or took out an alternative finance agreement the car would be yours to own, with a lease you never actually own it, but the plus side is that your monthly payments are much less.
What you are actually paying for is the depreciation of the cost of the vehicle along with a commission fee – hence the saying “If it appreciates, buy it. If it depreciates lease it.”
What you need to know before you start
In terms of evaluating a lease there are a few factors that you need to consider:
What car have you got your eye on?
The more expensive the car is, the more you can expect to pay for the lease of the vehicle over the duration of your contract.
The initial deposit which you put down
In most circumstances your initial deposit would be 3 times the monthly payment. For example: if your monthly fee was £200, your deposit would be 3 times that - £600. (See, we’re not just a pretty face) You can also choose to pay more for your deposit if you'd prefer in order to reduce your monthly payments.
Something that we like to brag about here is that we let you part-exchange your current vehicle towards the deposit – not a lot of others do, so bear that in mind.
How long do you want to lease the vehicle for?
In most cases, the longer the contract of your lease, the less you pay each month. But the downside is that you are tied down into the contract for a longer period of time – our leasing experts can have a chat with you to work out which length suits your individual needs most adequately if you are unsure.
What is your annual mileage?
The more miles you put on the clock, the less the car is worth. When your contract ends and you give the car back to us, we will probably sell it on, which makes the mileage especially important to us – you need to make sure that you stay under your estimated total or you will incur a PPM (Or Pence per Mile) charge.
Don’t worry too much about this though; you can get in touch whenever you like to re-negotiate your annual mileage limit to make sure that you stay well clear of any additional costs.
Would you like maintenance with that?
You don’t need to take this out, but we do offer maintenance included with all of our contracts. It just means that in the case of something going wrong, you can just give us a call on your dedicated number and we will get the problem sorted on your behalf.