Car Leasing Guide

Car Leasing at Lease Cars Direct could not be simpler

(If you wish to view our car leasing special offers immediately please click this link Car Leasing Special Offers)

Here we will give you a step by step guide on the whole car leasing process starting with the benefits of leasing cars through to returning your car at the end of the lease contract.

When choosing to lease a car please ensure it’s the right product for you, the best way to describe if it suits your needs is to least the type of people it would not benefit as is suits most people and will save most people £1,000s.

People car leasing would not work for:

1, Customers who want to put a large deposit down and pay a monthly payment for a fixed term to then own the car at the end of the agreement and have a period of cost free motoring.

2, Customers who do over 40,000 miles per year diesel, or 33,000 miles per year petrol as Car Leasing Companies will limit the contract mileage to these parameters.

If you wish to do any of the above we recommend a car purchase on finance either from a main dealer or agreeing a personal finance deal with a bank or building society.

THE FIRST STEP

The first step to car leasing is to quash the myths that people believe that it is no good because you are paying for something you'll never own or that the mileage is restricted to 10,000mpa or the prices go extremely dear.

The truth is that should you wish to own a new car every 2 to 3 years then you will not pay more than what you would pay on finance. The facts are that you would definitely save money on 99% of all contract hire against buying on finance.

To understand this better please go to our Car leasing v Buying page which explains this fully with examples.

STEP 2

The biggest decision you make when starting to lease a new car is choosing the correct vehicle a lot of people have a budget in mind but are sometimes pleasantly surprised that cars which they thought were out of their price range are actually not. Car leasing deals are offered monthly that offer great value and can be at greatly reduced rates. If you are prepared to be flexible you will almost certainly find a great offer on a car that is similar to your first choice. However at lease cars direct we recommend you go and test drive any car you choose before committing as it is essential it meets your requirements. Most car dealers and main dealerships will stock a car that you choose and make it available for test drive.

STEP 3

Now you have chosen the car or van you wish to contract hire, you now need to look at where you can get the best deals from a reputable car leasing company. There has been an influx of car leasing companies opening in the last 12 months as contract hire and leasing begins to see a big rise in the percentage of people changing from buying to leasing. These fly-by-night companies have somewhat diluted the industry and started to use practices that reputable companies to not condone or carry out, false advertising, deposits payable to them rather than the finance company, cashing deposit cheques before the car is delivered etc. These car leasing companies are to be avoided at all costs. The best way to check if a car leasing company is reputable is ask for a list of supplying dealers they use and a contact name so you can verify their service stands up. We believe that the cheapest deals don’t always deliver the best value service and usually carry hidden catches, all finance and vehicle details should be supplied upfront in the quotation not when a signed order is placed. A lot of the smaller lease car companies sub broker deals and add their profit in which dilutes the deal and costs the customer more so we recommend you look at the most prominent companies on the internet, ones that have high listings in the organic searches proving they have being established a long time to achieve these rankings.

STEP 4

Choosing a mileage, Car leasing mileage limits are sometimes an off putting factor to people looking into the car leasing industry for the first time however this should not be the case. When you choose an annual mileage you should get it as close to you annual distance travelled, we appreciate and understand that sometimes this can not always be achieved and we also realise that circumstances change so to advise you on what happens in these cases here are some simple explanations.

Q. What happens if you exceed the mileage on the contract?

A. At the quotation stage the car leasing company should provide you with an excess mileage rate which will advise the cost for each extra mile you cover. e.g. if the excess mileage rate is 4p and you go 1000 miles over allowance at the end of the car lease contract you will be charged £40 one off payment.

Q. If circumstances change and the customer maybe moves house or accepts a new job whereby the mileage increases substantially what can be done?

A. In this case we recommend you contact the finance company direct that the car leasing agreement is with and ask to negotiate a new price for an increased mileage. In our experience finance companies are very understanding and fair with this process.

Q. All the deals on the car leasing websites show prices on mileages of 10,000mpa, when I increase the mileage the price goes up, why is this?

A. As with buying a car and then selling it further down the line, the lower the mileage the better the sale price. This is the same for the leasing companies as when they receive the car back three years down the line the residual value will have dropped if the car has a higher mileage, therefore they have to offset this cost at the beginning of the contract hire.

Step 5

Once all the key decisions are made by the customer you then have to apply for the finance part of the lease agreement, this involves in most cases filling out a lease cars application form and providing some key details as you would when applying for any finance. However since the credit crunch and the banks failing us they have decided to punish customers by making the credit underwriting procedure a laborious and sometimes lengthy process while they do various checks, please expect to provide bank statements, proof of address etc for a personal lease and with businesses you will almost certainly need accounts and a trading history. Once all this information is submitted you will receive a decision as to whether you have been accepted or declined. This decision can take as little as 2 hours to sometimes over a week depending on the speed you supply the necessary information. If declined unfortunately we can not supply exact reasons why as the finance companies do not give us access to this decision, we recommend you use our free credit check and see if you uncover anything.

If accepted you move onto the order stage.

STEP 6

Once all the above is complete and you are happy you then move into ordering stage, the car leasing company will send a final order form, this will detail all the car particulars and any extras you may have ordered. It is imperative at this stage that you double check all the fine details as mistakes can be costly and cannot be rectified. Once the car Leasing Company receives the signed order they will then place that order with the supplying dealer. Once this is placed both the customer and the Car leasing company are committed to the order and receive penalties if cancelled. Once the order is placed you will receive a call from a reputable company’s administration team to advise an estimated time of delivery, this administrator will keep you up-to-date throughout the period up to delivery. Once the car is close for a delivery date the Car leasing company will send out you finance documents and request your initial payment cheque, the car cannot be delivered until these documents, cheques and proof of ID are in and accepted.

STEP 7

FREE!!

Delivery of your new car and commencement of your contract hire agreement. Delivery (unless otherwise stated) will be free to any address nationwide in the British Isles, deliveries to Northern Ireland are only to the nearest port on the British Isles. When your car is delivered it will normally be on a transporter or driven by a delivery company. We recommend that you do the following checks when your car arrives.

1, Check for any damage, scratches, missing extras, your warranty and service book, alloy wheels etc. If any of these are not as you require we recommend you decline the delivery and do not sign the delivery note. However if it’s a minor detail then we recommend if you wish to sign for the car that no matter how minor you make a note of it on the delivery note and inform your Car Leasing company before signing.

2, Check the mileage, if the car has been driven as a delivery method it may have several hundred miles on, therefore you need to note this on the delivery note so it does not come out of your agreed allowance.

STEP 8

Throughout the term of your contract you need to ensure the car is maintained to an acceptable standard, this means adhering to the service schedule and keeping the car in a roadworthy condition. Please check the parameters in the handbook at the beginning of the contract hire agreement. Maintenance contracts are available should you wish to include the cost of maintaining the car in your monthly rental, please look into this at the point of quotation.

STEP 9

End of the car leasing contract, we recommend if you wish to lease another car or extend your current lease car that you make contact with the Car leasing company 3 months prior to the expiry date to arrange a vehicle in time for the return of your current vehicle. When returning your current vehicle which in most cases will be free of charge collection, we recommend you take detailed photographs of the condition.

STEP 10

WHAT IF??

Q. I can not afford the payments anymore?

A. In this instance we recommend you contact the finance company immediately, do not leave it and miss payments as this will be detrimental on your credit. Most finance companies have departments that will help you chose the correct option to end your lease or arrange repayment plans.

Q. I no longer wish to lease a car what can I do to hand the car back?

A. Most finance companies will allow you to return the car but be prepared to pay a cancellation fee which in most cases will be 50% of the remaining rentals

Q. I have decided I wish to get a new car and I still have a year left on my contract hire agreement what can I do?

A. As in the previous question the fee to cancel is normally 50% of the remaining rentals, we can take this fee and add it into the new car lease you wish to take, this will increase your monthly rental slightly but gets you into the car you want.

We hope this guide has been informative and we highly recommend the car leasing product as a cost effective way to drive a better quality car with a lower monthly cost, this also provides the hassle free ownership of not having to sell at the contract end. If you have any further questions please don’t hesitate to contact one of our experienced team.

Lease Cars Direct recommends OnYourMind.Com find information on houses to buy or rent, New Jobs or Car and home insurance.