Car Leasing, Contract Hire, Lease Purchase - HELP!

Last Updated: 1st May 2018
Car Leasing, Contract Hire, Lease Purchase - HELP!

10th May 2012

Leasing Explained..... So many options available but which one is the right one for me?

Car Leasing?

Leasing is effectively a long-term rental agreement, 2 or more years with a fixed monthly payment.

With leasing, you never obtain ownership of the car you drive – you “rent” it for an extended period of time.

At the end of the period you hand the car back and walk away or, by signing a new agreement, choose a new car.

As an individual the rental agreement will be financed, we work alongside some of the worlds biggest banks and finance houses offering the best rates available.

Most often, the monthly payments on a car lease may be significantly less than those you would have incurred had you financed a loan on the same vehicle.

Effectively, it may cost less to lease a new car over a short period of time, than it would cost to buy the same car and trade it in.

Leasing is often a good option for people looking to consistently drive newer cars.

There is also the option for private individuals to Lease Purchase;  especially popular if you are new to leasing - the security of being able to purchase the car at the end of the contract is appealing.

As a business.... Lease Purchase or Contract Hire is the most popular leasing option as it is a tax-efficient way to finance vehicles.

Think of it as an effective way for you to finance and pay for the depreciation of the vehicle during the lease period.

At the end of the lease term you either buy the vehicle, for its residual value, or simply give it back.

Lease Purchase is ideal if you want to

  • Use an asset without the risk of ownership.
  • Upgrade your vehicle with the latest or best models suited for your business.
  • You have the option to include a maintenance package (servicing, replacement parts and tyres)
  • You drive the vehicle you want without having to make a lump sum payment.
  • At the end of the lease term you have the option to buy the vehicle.

Your financial status and type of car you are considering should be your main deciding factor, we think ‘If it appreciates, buy it. If it depreciates, lease it’.

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