What is leasing?
On the whole ‘leasing’ is a pretty loose term which is often used to refer to various types of car finance. More precisely, the word refers to the product technically known as contract hire. Fundamentally, car leasing (or contract hire) is a form of long term car rental not too dissimilar to the way you might rent your home.
Leasing essentially allows you to pay a negotiated upfront payment, known as an initial rental, followed by fixed monthly payments. Your brand new car will be covered by the manufacturer's warranty over an agreed period of what is usually two, three or four years with an agreed mileage cap. Whilst you will not legally own the car, for most intents and purposes it is yours to use as if you do. Once your contract is over, you simply hand the car back.
How much does leasing cost?
The cost of a lease depends on which vehicle you choose, how long you want to keep it for, how many miles you drive and the sum of your initial rental. Generally the lesser the miles per annum and the longer contract, the cheaper your monthly payments will be.
As you’d expect, the more money you put down up front, the less your monthly payments will be and vice versa. Leasing is incredibly flexible in this sense because it doesn’t matter which way you choose to do it; the total cost of the lease remains the same, it’s all down to personal preference!
In the leasing world you might come across complicated ‘payment profiles’ such as ‘6+35’. Fortunately this seemingly complicated profile is relatively plain sailing. This is simply a division of the total cost of the lease, with in this case the initial rental (payment) being six times that of the 35 monthly payments thereafter.
Generally, you can choose to put 3, 6, 9 or 12 initial rentals down over 2, 3 or 4 years, however some of our finance providers will allow as few as 1 initial rental, thereby making your first payment the same as every proceeding payment albeit at a higher monthly cost. Don’t worry if this doesn’t make sense to you, all you need to know is how much money you want to put down up front and our friendly team will do the rest!
Vehicle Excise Duty (road tax) is covered as part as your monthly payment throughout the lease contract. Other than maintenance and running costs of your vehicle (see below). For the first time ever, we no longer charge an admin fee, meaning you now get an extra £179.99 in your pocket.
Is car maintenance included?
By default our advertised pricing is based on customer maintained contracts, meaning maintenance costs are not covered by the finance company and it would be your responsibility to cover the costs of having your car suitably maintained and serviced at an approved garage.
Don’t worry about your shiny new car simply ‘giving in’ on you and leaving you with expensive repair bills though. Whether you opt for maintenance or not, your car will be covered by the full manufacturer’s warranty meaning mechanical and electrical faults will be covered and fixed free of charge.
If you think budgeting for maintenance costs might cause you a headache, then a maintained contract is an ideal solution for you. This means servicing, tyres, replacement parts and labour are covered - all you have to do is take your car to one of our approved garages making maintenance of your new car a done deal as soon as it’s delivered!
Maintained contract or not, you are wholly responsible for the vehicle which does mean you (or your insurance) must cover the costs of any accidental damage to the car. De-hire charges (or end of lease charges) do apply in instances where larger scratches and scrapes are present upon returning the car. Don’t let this scare you though, as we understand it is not possible for the car to return in showroom condition, so smaller blemishes and age-related wear as outlined in the Fair Wear and Tear guide are fine and will not be charged for.
How many miles do I need?
When you are organising a lease you will be asked to specify your annual mileage. Typically the more miles per year you do, the more expensive your payments will be. It is important to advise of your mileage as accurately as possible because if you exceed this allowance you will have to pay an excess charge measured in ‘pence per mile’, which will vary depending on the car and contract you take out.
In instances where you feel you cannot accurately gauge your mileage it might be a good idea to have a good discussion with our team of specialists who can help you out. Sometimes paying for more miles in the first case might work out cheaper, or simply paying the excess mileage charge may work out cheaper - it all depends on each finance provider we work with and how many miles you think you could go over by.
Does leasing include insurance?
The simple answer is: as standard, no. But it can.
Typically in a lease you will be responsible for organising insurance for your lease car, just as you would for a car you legally own. This must be fully comprehensive cover and your insurer must be aware that your car is a leased vehicle meaning you are the registered keeper, not owner.
If you want insurance to be included as part of your lease contract, we do offer something called Just Fuel Leasing. This contract hire deal bundles everything from insurance, maintenance, breakdown cover, accident management and total loss shortfall protection into one easy-to-manage monthly payment.
Can I modify my lease car?
If we’re being completely honest, if you’re planning to go all out fast and furious on your next car, then leasing isn’t for you. Generally modifications are not allowed on a leased car although in some instances arrangements for reversible modifications can be made with explicit permission.
More and more people are embracing contract hire and for good reason, so have a browse through our best offers and see if anything tickles your fancy. We understand car leasing and contract hire can be a confusing place, so if you have any further worries or questions before you commit to a contract you are more than welcome to contact us and fire away.