Whether or not you should lease or buy a van is almost entirely dependent on your circumstances. Take a look here and consider if you’d benefit from having a new vehicle every few years and if you’d prefer to be able to pay over a monthly contract. If so, then leasing may be for you. There are even options for all performance cars. It isn’t without its hidden costs, though, so here are three ways you can make sure you don’t end up overpaying.
Negotiating Any Initial Fees
Leasing contracts generally operate over a two to three-year period. You’ll see these advertised as “3+23” or “3+35” contracts. This is because you’ll be required to pay the first three payments upfront, in the form of a deposit, followed by the rest over the course of your agreement. While relatively common, deposits are not mandatory and you may be able to arrange a better deal with your lender. If you don’t want to have to pay as much upfront, start by trying to negotiate the initial three-month advance down to one month.
Excess Mileage Rates
Your annual mileage rate will be decided upon at the start of your contract. The minimum you can set is typically 10,000 miles per year (for comparison, the UK average is around 7,900) with a maximum of 40,000. If exceed your agreed-upon mileage limit, you’ll have to pay for a set excess mileage rate on a per-mile basis at the end of your contract. Because of this, it’s highly recommended that you take the time to better understand your current driving habits. You should also try and anticipate any changes that would affect this that might occur during the length of the agreement.
Fair Wear and Tear
Your lender’s fair wear and tear policy refer to the kind of damage they’re willing to accept during the course of your contract. A description will be outlined in your agreement. These often describe specific scenarios in detail, such as scratches above certain lengths or damage to particular areas of the vehicle. The best form of action is to carry out an appraisal of the vehicle a couple of months before the contract is due to expire. This will allow you to arrange to have any damage repaired beforehand.
The secret to running a successful business is carefully planning out your expenses. Make sure you’re aware of all the minor details in the contract so you aren’t hit with any unexpected fees down the line.
Leave a Reply