A lease is
essentially a long-term rental agreement, offering exclusive use of a
car for a set period at a fixed monthly price.
As a
business, this is the most cost efficient method of funding the vehicles
as it takes advantage of the tax and vat regulations to reduce the
whole life running cost of your vehicles and is supported by the buying
power of the finance company, to assist in reducing the cost even
further.
The greatest cost of running any new car is
depreciation, and many new cars will lose more than half their initial
value after the first three years of ownership.
Leasing explained
Leasing a car lets you
avoid any unexpected costs by offering a fixed monthly payment for the
term of the lease.
Unlike dealer finance or bank
loans you only pay for the depreciation of the vehicle over the term
rather than the full capital value.
Rather than pay
large deposits you simply pay a small initial amount, usually equivalent
to three monthly payments, at the start of the lease.
Then, at the end of the lease period (typically two or three
years), you simply hand the car back. The job of selling the car and
picking up the tab for depreciation is the responsibility of the lease
company.