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Why
should I lease or hire a car? |
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As an
example, if you lease or hire a car that could cost £20,000, but is worth
only £13,000 after 36 months, you pay for the £7000 difference (this is
called depreciation) plus finance costs. When you buy, you pay the
entire £20,000, plus loan interest charges, plus fees. This is
fundamentally why leasing or hiring offers significantly lower monthly
payments than buying, these contracts also allow you to drive a more
expensive car than you could afford if buying outright, and a new car
every two or three years.
Bear in mind
that you will be subject to a credit check by the finance house prior to
acceptance, if you know you have credit issues inform
us and we will usually source the right finance option for you.
Contact us to
quote you for your new vehicle, we will be happy to help.
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Is
there a mileage limit? |
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Car Lease and
Hire contracts limit the number of miles you can drive, from 6,000 miles
per year up to 150,000 total miles for the contracted period. If you
exceed your limit, you incur "excess mileage" charges at the end of the
contract. To keep the cost of the lease as low as possible, try to
ensure that you are only contracted for the miles you think you will
drive. Higher mileage contracts means higher monthly payments.
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What
level of wear and tear is expected? |
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Car Leasing and Car Hire
companies require that you return their car at the end of the contract
with no more than "normal" wear-and-tear. Anything more and you'll pay
for the damages. You are responsible for insurance, upkeep, and
maintenance just as with a purchased car. Some people mistakenly believe
the finance company is responsible. |
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Do I
have any ownership of the vehicle? |
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When you
lease a car, you don't have ownership, unless you choose to buy at
contract-end - which about a third of all leasers do. Leasing is not all
that different than buying with a loan, in which case the bank holds the
title and you don't own your car until the loan is paid off.
A Hire
contract however does not allow you to buy the vehicle, at the end of
the contract you simply return the vehicle to the finance company.
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How
often can I get a new car? |
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One of the
benefits of leasing or hiring a car is that you can drive a new car every one,
two, three, or four years. To many people, this is an acceptable trade
off with having to make ongoing payments considering the benefit of
always having a new car that is always under warranty. And should you
lease you still have the option to buy at the end of the contract if you
decide you want to keep hold of a particular car.
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Do I
need to make a down payment ? |
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Making a down
payment can substantially reduce your monthly payment amount. If you
think you might ever want to end your lease early, an initial down
payment can reduce or eliminate the cost of early termination. It is not
however necessary, most car lease and
car hire contracts require a deposit of 3
monthly installments as an initial payment, followed by 11,23,35 or 47
further payments, dependent on the contract period chosen. |
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What
does full maintenance mean and what does it cover? |
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Full
Maintenance is an additional cover over and above the normal dealers
warranty for you. You pay an extra premium per month on top of the
agreed car finance cost and this covers you for everything except for
insurance and petrol. As all leased cars are required to have their
services, a full maintenance contract also covers this cost, as well as
any tyres that may be needed. Generally, a full maintenance contract is
not financially advised for contracted mileage of under 15,000 miles per
year as the extra cost can outweigh the normal costs incurred of
maintaining your car. But it does offer piece of mind.
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Does
the cost include delivery? |
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Yes. Your new
car will be delivered to your chosen address be it home or work.
The lead time
for delivery very much depends upon the make and model you have chosen,
if the car has to be ordered from the manufacturer you can wait up to 6
months for a high specification vehicle, if you are less choosey about
colour, spec etc a car can often be sourced direct from stock and
delivery can be within 4 weeks.
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What
cars make the best lease cars? |
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Ideally the
best cars to lease on a contract lease, whether it's business or
personal, are the makes that hold their value for a longer period. If a
car loses its value quickly over the contract period this can increase
your monthly payments as this is what the payment calculation is based
on. The
example in question 1 above should help illustrate
this point.
There are
over 40,000 makes, models and options of vehicles currently available in
the UK, speak to your broker for help and advice, they will also keep an
eye out for any deals for you to consider.
For further
advice contact us.
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What
happens if my car breaks down? |
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All cars
leased supplied come with a manufacturer's 3 year warranty. If the repairs that
are needed arise through use by the driver the agreement owner has full
responsibility, unless a full maintenance contract is arranged. If it's
an issue that is covered by the warranty simply book the car into your
nearest garage that specialises in the particular make of car and ensure
that you take all the contract paperwork with you. The repairs will be
covered fully by the warranty and at no cost to you.
more information about short term car
leasing
more tips on
leasing a car |