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How Leasing Works

How does car leasing work?

With a car lease you are paying for the use of that car for a set period of time; typically, 2, 3 or 4 years. You are paying for the depreciation only of the vehicle, thus getting the right lease deal can mean you can drive a much more expensive car for your budget than other methods of funding.

How Vehicle Residuals Effect Lease Payments

When you lease a new vehicle, you’re “buying” the vehicle’s depreciation (the left section).

When the residual value is high, you “buy” a smaller chunk of the car.

If the residual value is low, you have to buy a bigger portion of the car and that makes your lease payment higher.

Taking a car lease helps you avoid any unexpected costs by having a fixed monthly cost for the duration of the lease. You don’t have to worry about depreciation or selling the car as the finance company has responsibility for this. By adding an optional maintenance package on, any servicing costs and replacement tyres can also be covered,

The length of contract you choose can be down to how long you want to take the car for or sometimes can be due to there being a special offer on a particular length of contract (sometimes 2 year deals may work much cheaper than 3 years for instance due to the large discount on the vehicle being divided by a shorter timeframe)

How are car leasing deals structured?

Most car leasing deals consist of an ‘initial rental’ and a set series of monthly repayments. The initial rental refers to how much you’ll pay up front (usually after delivery) and is usually three, six or nine times the monthly payment amount. Car leasing deals are usually referred to by the size of the initial rental and the number of subsequent monthly payments. For example, a 6 + 35 agreement requires an initial rental amount equal to six monthly payments, after which you’ll pay a set monthly payment amount every month for the next 35 months. The total length of a 6 + 35 deal is 36 months (three years). A 9+23 would therefore be an initial rental of 9 payments followed by 23 monthly payments. There is usually a processing fee to be paid just after ordering.

How does the process work?

Do I own a leased car?

No – the finance company buy the car and own it

As such, it’s quite similar to renting a house – you have sole use of it, but it’s still owned by the landlord at all times. If you want to change your car every few years and have a security of a new car under full warranty then leasing could be for you. If you want to own a car outright and run it for a long time then leasing isn’t really for you.

Not owning your leased car means you won’t have to worry about the hassle of selling it on, or how much it may have lost in value (depreciated) in the time you’ve been driving it. Our lease offers are on new cars only (some are pre registered but are brand new). As such they are all covered by the manufacturer’s warranty, meaning you won’t have to pay to fix any unforeseen issues.

How do I insure a leased car?

Just the same way you would for a car you owned outright. On the bulk of our offers we can’t factor it in to the rental so you will need to arrange fully comprehensive insurance. When insuring, you have to put the finance company as owner and keeper of the car. Sometimes as the car is brand new, the registration number won’t show on their database so you will have to give them make and model and explain it is brand new in order to get a quote.

Are there any downsides to leasing a car?

Car leases can be expensive to get out of if your circumstance change- there will be a settlement based around the number of rentals left. You should always consider if you can keep up repayments if your circumstances were to change.

Check our other informative pages:

Guide to personal leasing
Guide to Business leasing
FAQ’s
Maintenance explained

A selection of our latest offers

Special Offer

SEAT

Tarraco 2.0 TDI 150 SE Technology
SEAT Tarraco image

Personal Inc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £2,442.85
£271.43pm

Business Exc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £200
Initial rental: £2,035.71
£226.19pm
View Deal
Special Offer

Renault

Zoe R110 i Iconic ZE 50kWh Auto
Renault Zoe image

Personal Inc VAT

Term: 36 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £2,061.29
£229.03pm

Business Exc VAT

Term: 36 months
Mileage: 5000 miles
Fee: £200
Initial rental: £1,717.74
£190.86pm
View Deal
Special Offer

DS Automobiles

3 Crossback Cross Back 1.2 Puretech 130 Prestige EAT8
DS Automobiles 3 Crossback image

Personal Inc VAT

Term: 24 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £1,807.70
£200.86pm

Business Exc VAT

Term: 24 months
Mileage: 5000 miles
Fee: £200
Initial rental: £1,506.42
£167.38pm
View Deal
Special Offer

Ford

Ecosport 1.0 EcoBoost 140 St-Line
Ford Ecosport image

Personal Inc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £1,677.89
£186.43pm

Business Exc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £200
Initial rental: £1,398.24
£155.36pm
View Deal
Special Offer

Nissan

Leaf N-Connecta 40KW
Nissan Leaf image

Personal Inc VAT

Term: 36 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £2,141.86
£237.98pm

Business Exc VAT

Term: 36 months
Mileage: 5000 miles
Fee: £200
Initial rental: £1,784.88
£198.32pm
View Deal
Special Offer

Volvo

XC60 2.0 B5 P 250hp Momentum Auto FWD
Volvo XC60 image

Personal Inc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £3,175.74
£352.86pm

Business Exc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £200
Initial rental: £2,646.45
£294.05pm
View Deal
Special Offer

BMW

1 Series Sporthatch 118i 1.5 M Sport Steptronic Auto
BMW 1 Series Sporthatch image

Personal Inc VAT

Term: 36 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £2,321.46
£257.94pm

Business Exc VAT

Term: 36 months
Mileage: 5000 miles
Fee: £200
Initial rental: £1,934.55
£214.95pm
View Deal
Special Offer

Peugeot

5008 Suv 1.2 PureTech 130 Allure Start+Stop
Peugeot 5008 Suv image

Personal Inc VAT

Term: 24 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £2,296.40
£255.16pm

Business Exc VAT

Term: 24 months
Mileage: 5000 miles
Fee: £200
Initial rental: £1,913.67
£212.63pm
View Deal
Special Offer

BMW

X3 xDrive20d M Sport Auto
BMW X3 image

Personal Inc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £2,998.94
£333.22pm

Business Exc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £200
Initial rental: £2,499.12
£277.68pm
View Deal
Special Offer

Kia

XCeed 1.0 T-GDi 118bhp 2 ISG
Kia XCeed image

Personal Inc VAT

Term: 24 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £1,120.28
£124.48pm

Business Exc VAT

Term: 24 months
Mileage: 5000 miles
Fee: £200
Initial rental: £933.57
£103.73pm
View Deal
Special Offer

Kia

Sportage 1.6 GDI 130 Platinum Edition ISG
Kia Sportage image

Personal Inc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £1,967.11
£218.57pm

Business Exc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £200
Initial rental: £1,639.26
£182.14pm
View Deal
Special Offer

SEAT

Ibiza Hatch 1.0 MPI 80ps FR EZ
SEAT Ibiza Hatch image

Personal Inc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £1,560.92
£173.44pm

Business Exc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £200
Initial rental: £1,300.77
£144.53pm
View Deal
Special Offer

SEAT

Leon Hatch 1.5 TSI Evo 130 FR EZ
SEAT Leon Hatch image

Personal Inc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £1,762.56
£195.84pm

Business Exc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £200
Initial rental: £1,468.80
£163.20pm
View Deal
Special Offer

Audi

A6 Avant 40 TDI 204 12V S Line S tronic
Audi A6 Avant image

Personal Inc VAT

Term: 36 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £2,908.44
£323.16pm

Business Exc VAT

Term: 36 months
Mileage: 5000 miles
Fee: £200
Initial rental: £2,423.70
£269.30pm
View Deal
Special Offer

Skoda

Karoq 1.5 TSI 150ps Act Sport Line DSG
Skoda Karoq image

Personal Inc VAT

Term: 24 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £2,106.00
£234.00pm

Business Exc VAT

Term: 24 months
Mileage: 5000 miles
Fee: £200
Initial rental: £1,755.00
£195.00pm
View Deal
Special Offer

SEAT

Ateca Suv 1.5 TSI 150ps Evo FR EZ
SEAT Ateca Suv image

Personal Inc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £2,551.28
£283.48pm

Business Exc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £200
Initial rental: £2,126.07
£236.23pm
View Deal
Special Offer

Volkswagen

Golf 5-Door Hatch 1.6 TDI 115PS 5speed GT
Volkswagen Golf 5-Door Hatch image

Personal Inc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £1,796.47
£199.61pm

Business Exc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £200
Initial rental: £1,497.06
£166.34pm
View Deal
Special Offer

Nissan

X-Trail 1.7dCi N-Connecta
Nissan X-Trail image

Personal Inc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £2,121.44
£235.72pm

Business Exc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £200
Initial rental: £1,767.87
£196.43pm
View Deal
Special Offer

Peugeot

3008 Suv 1.2 Puretech 130 GT Line Premium EAT8 Start+Stop
Peugeot 3008 Suv image

Personal Inc VAT

Term: 24 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £2,306.45
£256.27pm

Business Exc VAT

Term: 24 months
Mileage: 5000 miles
Fee: £200
Initial rental: £1,922.04
£213.56pm
View Deal
Special Offer

Mercedes

E-Class Saloon E220d 2.0 AMG Line Edition Auto
Mercedes E-Class Saloon image

Personal Inc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £240.00
Initial rental: £2,748.17
£305.35pm

Business Exc VAT

Term: 48 months
Mileage: 5000 miles
Fee: £200
Initial rental: £2,290.14
£254.46pm
View Deal

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