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Choosing your finance package

Once you have decided on the type of new car or van that you want, the next important decision is which finance package suits your personal or business needs.
At leasing.cars we understand that this can be daunting not to mention time consuming. We are committed to helping you understand the many car leasing and contract hire options available to you whether you are researching the best solution for a larger fleet, small business, for personal use or as a company car driver. 
Our team can offer you information on the most efficient ways to finance your new vehicle. Whilst we take care to ensure that our team are suitably qualified and trained to discuss business and personal agreements, we would suggest that you do your own research to ensure that the finance package you choose is right for your own needs.
We are committed to our Best Price First Time policy, you can be reassured that you will be provided with the most competitive car and van contract hire and leasing deals that we can offer.

Our finance options

What it is?

A long-term rental agreement (sometimes known as an 'operating lease')

Who is it popular with?

VAT-registered companies.

How long does it last?

24 to 60 months, depending on business requirements

Is it available with maintenance?

Yes

Additional points:

  • The contract hire company reclaims the VAT on the original purchase, so they can reduce your monthly rentals (these include VAT).
  • VAT-registered companies can claim back 50% of the VAT (blocked VAT) on the finance element for cars and generally 100% for commercials (as long as there is no private use or exempt turnover and they are not on the Flat Rate VAT Scheme).
  • On contracts with maintenance, the VAT on the service element is 100% recoverable.
  • Road fund licence is provided for the full term of the contract.
  • If you opt for a maintenance package, you are helping to fix your companies monthly expenditure and save time managing your fleet.
  • One of the major benefits is that there are no disposal worries, as the future value is underwritten by the leasing company.
  • If the vehicle exceeds the contract mileage an excess mileage charge will apply. Early termination charges may apply if you end the contract before the formal end date.
  • It is your responsibility to maintain the vehicle in accordance with the manufacturer guidelines, additional maintenance packages are available.
  • This is a hire product so you will not own the vehicle.
  • You will be liable to pay for any excess damage that is on the vehicle at the end of contract that is outside of the BVRLA Fair Wear and Tear Guidelines.

What it is?

A purchase product where you agree to purchase a vehicle for a fixed instalment each month with an optional guaranteed final payment.

Who is it popular with?

People who would like options at the end of their finance agreement.

How long does it last?

Typically, 24 to 60 months.

Is it available with maintenance?

Yes.

Additional points:

  • You make an initial payment when you first take out your contract, followed by fixed monthly payments and a final instalment at the end of the contract.
  • You have a number of options as the end of the contract:
    • Hand the car back and let the finance company dispose of the car.
    • Purchase the car for the final payment as agreed in the contract and take ownership.
    • Trade the vehicle in and use any equity towards your next car. You may have to pay the final instalment first to take title.
  • If the vehicle exceeds the contract mileage an excess mileage charge will apply.
  • It is your responsibility to maintain the vehicle in accordance with the manufacturer guidelines, additional maintenance packages are available.
  • You will be liable to pay for any excess damage that is on the vehicle at the end of contract that is outside of the BVRLA Fair Wear and Tear Guidelines.

What it is?

A way of obtaining use of a vehicle by paying a monthly rental.

Who is it popular with?

VAT-registered businesses operating commercial vehicles.

How long it lasts?

Typically, between 24 and 60 months.

Is it available with maintenance?

Yes.

Additional points:

  • The monthly rental is determined by the initial cost of the vehicle (excluding VAT), the period of the lease and the residual value (sometimes called the balloon payment), plus interest
  • Although you never take ownership, at the end of the contract a final rental is payable.
  • Usually, this means the vehicle is sold and a proportion of the proceeds of the sale are returned to the lease holder. In most cases, the customer receives 98% of the sales proceeds, while finance company retain 2%. Or you can hold on to the vehicle for a small annual cost, this is referred to as a Peppercorn rental.
  • On this agreement, you take on the residual value risk, so although there are no excess mileage charges. If you are setting a final rental, you need to consider the usage over the term to ensure that the asset is worth enough to cover the amount, alternatively you can opt for a fully amortised agreement with no final rental.
  • It is your responsibility to maintain the vehicle in accordance with the manufacturer guidelines, additional maintenance packages are available.
  • This is a hire product so you will not own the vehicle.

What it is?

An agreement to buy a car where you pay a deposit, monthly payments for the duration of the contract and then the final value at the end.

Who is it popular with?

People who would like to own a car but do not necessarily have the money to buy one immediately. In particular, non-VAT-registered customers who eventually want to take ownership.

How long it lasts?

Typically, between 24 and 60 months.

Is it available with maintenance?

No.

Additional points:

  • This is a flexible product, so it is possible to put down a larger initial payment, which in turn reduces the monthly payments.
  • The monthly cost is worked out on the difference between the sale price value and the depreciation value plus interest.
  • This is a contract to purchase the car, so it is only for people who are absolutely sure they want to take ownership at the end of the contract.
  • On this agreement, you take on the residual value risk, so although there are no excess mileage charges. If you are setting a final balloon payment, you need to consider the usage over the term to ensure that the asset is worth enough to cover the amount, alternatively you can opt for a Hire Purchase agreement with no final payment but you will pay more per month.
  • It is your responsibility to maintain the vehicle in accordance with the manufacturer guidelines, additional maintenance packages are available.

What it is?

A fixed-term contract where customers pay an agreed monthly rental for a set period.

Who is it popular with?

Customers who don’t want the financial risk associated with selling a vehicle and want fixed cost motoring.

How long does it last?

Typically, it lasts for two, three or four years – though contracts sometimes can be formally extended for longer.

Is it available with maintenance?

Yes.

Additional points:

  • One of the major benefits is that there are no disposal worries, as the future value is underwritten by the leasing company so you have no depreciation risk.
  • Road fund licence is provided for the full term of the contract.
  • If you opt for a maintenance package, you are helping to fix your monthly expenditure.
  • Often manufacturers use this type of finance to promote special offer deals, the cash price of the vehicle is not disclosed so it has less effect on used car values.
  • If the vehicle exceeds the contract mileage an excess mileage charge will apply. Early termination charges may apply if you end the contract before the formal end date.
  • It is your responsibility to maintain the vehicle in accordance with the manufacturer guidelines, additional maintenance packages are available.
  • This is a hire product so you will not own the vehicle.
  • You will be liable to pay for any excess damage that is on the vehicle at the end of contract that is outside of the BVRLA Fair Wear and Tear Guidelines.