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What is Contract Hire?
Contract Hire is the most popular choice of vehicle financing for VAT-registered Companies. Minimum outlay and maximum cost control, especially when the maintenance and relief vehicle options are included.

Contract hire is also a VAT-beneficial financing package, with one regular monthly rental payment for an agreed period of time and mileage. Deprecation, finance, Road Fund License and disposal are included, but roadside rescue, maintenance and relief vehicle provision are options that can be added and charged to the rental payment.

What Is Contract Purchase?
Contract Purchase is for Companies whom want to acquire high value cars and have the option to purchase the vehicle without the deprecation risks.

Fixed monthly instalments are made based on time and mileage. The vehicle is shown 'on' the company balance sheet, and the company can either retain ownership at the end of the contract or return the vehicle.

What Is Lease Purchase?
Lease Purchase is an ideal car finance package for Non-VAT-registered companies whom want eventual ownership of the vehicle.

A Lease purchase is an agreement where the company acquires ownership when all the payments including the option to purchase, have been made. Part of the capital may be deferred into a "balloon" payment at the end of the agreement which equates to the anticipated market value of the vehicle at the end of the agreed leasing period.

What Is Personal Leasing?
Personal Leasing, Personal Contract hire or Personal Contract Purchase are perfect solutions for private individuals who want a hassle-free and cost-effective way to finance and maintain a vehicle of their choice.

A fixed monthly rental based on time and mileage is agreed. A small deposit can be arranged and a maintenance package can be added on. At the end of the period the vehicle is returned and another one taken, allowing a new car every two or three years without the hassle. Perhaps the best thing though is that a personal lease does not attract benefit in kind taxation. Many company car drivers opt out of having a company car and take extra salary.

What Is Finance Leasing?
A Finance Lease is ideal for VAT-registered companies who want to handle the administration of their vehicles, and have the asset shown on the balance sheet.

A VAT-beneficial finance option where the hirer can choose to pay the entire cost over the agreed lease period, plus an interest charge, or pay lower monthly rentals during the lease period with a final payment based on the anticipated resale value of the vehicle.

What About Insurance?
The lessee i.e. the customer, is responsible for the insurance of the vehicle as appropriate with its intended use.

How Does the Maintenance Option Work?
If you take out a leasing scheme, certain funding options will give you the choice of a Maintenance package. The maintenance package is an additional cost and covers routine servicing and repairs, (except bodywork repairs) for the duration of the contract. Work is carried out at the dealer of you choice although it is your responsibility to ensure that the vehicle is maintained as specified by the manufacturer and that any repairs are carried out as soon as possible.

Will my car have Breakdown Cover?
Most new vehicles have breakdown cover for the duration of the manufacturer's warranty. If it doesn't breakdown cover can be arranged through either the AA or RAC at an additional monthly charge.

What Is a Relief Vehicle?
Most main dealers have courtesy vehicles available for when your vehicle is being serviced or repaired. However for longer repairs or for accident repairs this is not always possible. If you have a contract hire lease, a contract purchase lease or a personal contract hire, then a relief vehicle provision can be added to the monthly rental to cover you in such circumstances.

What Is GAP Insurance?
If your vehicle is stolen or written off in an accident, there may be a shortfall between the value of the vehicle and the outstanding finance amount. In these circumstances GAP insurance would cover the difference.

Can I terminate the contract early if I want to?
Yes, you may terminate the contract at any time before the contract due date but this may incur penalties especially near the beginning of the lease. A quotation for the penalty will be readily available. The industry norm is 50% of outstanding rentals. This is a guideline only.

Can I change the terms of the contract, i.e. length or mileage at any time?
Depending on the contract and the changes needed this can be done but advice will be forthcoming.

What happens if I exceed my contract mileage?
At the time of quotation the 'excess mileage' penalty will be declared. If at the end of the lease the vehicle has exceeded the agreed mileage then the penalty fee will be due. If the vehicle has exceeded by a small amount the charge will not be much. The 'excess mileage' penalty takes into account the extra depreciation and maintenance suffered by the leasing company.

Can I buy the vehicle at the end of the contract?
Yes, there are no restrictions for personal contract hire or contract hire but business users would need to buy the vehicle through a third party if it was a finance lease. Ex- lease cars are a good second hand proposition as they are normally well maintained.

Can I swap the vehicle in the middle of a lease for another vehicle?
This can be done but the original lease will have to terminated and therefore charges may apply

Will the car be supplied locally?
Vehicles are sourced from reliable dealers whom can offer the necessary discount and service. Wherever possible a local dealer will be used.

Where do I take the vehicle for servicing?
If you do not have a maintenance package the vehicle must still be serviced and maintained as per the manufacturer instructions. If you have a maintenance package this also applies and can be serviced at a nominated dealer. What warranty is there on a vehicle?

Most vehicles come with between 12 and 36 months of warranty. If a used vehicle is supplied then the balance of the manufacturer warranty still applies

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