What is personal car leasing?
Many companies have enjoyed the advantages of car leasing for some years. However, there’s growing awareness that it’s an attractive option for individual car drivers too!
In fact, there are around two million people in the UK who now lease, rather than own their vehicle.
Personal car leasing is seen as a great way of getting access to the latest models while managing the money spent on annual driving costs.
This guide looks at the topic in more detail and provides tips on leasing cars for individual motorists.
The difference between owning and leasing cars
If you need – or want – a ‘new set of wheels’, you can save hard, use your existing funds, or explore car financing deals. You’re then the owner and take responsibility for all maintenance costs. When you’re ready to change vehicles, you’re also responsible for selling your old car and settling any residual financing arrangements.
The big difference between that and personal leasing is that you never actually own the vehicle. In effect, you have it on long term ‘loan’ and you pay the car leasing company a pre agreed monthly amount in return for the make, model, colour and special features of your ‘dream car’.
The cost implications of personal car leasing
For many motorists, the biggest advantage of leasing over owning is it can save a substantial amount of money!
You don’t need to find a large amount of cash to buy the car outright or put down a deposit. Personal car leasing often involves a relatively small upfront payment, and then easy to manage regular monthly amounts. It can compare very favourably with car financing deals and the interest charged on car loans.
Devaluation of cars
Another great financial benefit of car leasing as an individual is that you avoid the horrors of deprecation! ‘WhatCar?’ estimates that many cars lose between 50 and 60% of their value, in the three years after the first leave the garage forecourt!
(source: https://www.whatcar.com/advice/buying/depreciation-what-is-it-and-how-do-i-avoid-it/n1122)
Greater choice of cars, and regular new ones
Apart from the cost savings from personal car leasing, the big attraction for many is the opportunity to drive the newest models, with all the gadgets and gizmos you could possibly need!
There’s none of that haggling over what’s included in the price or rushing around adding items when you purchase a car.
With personal car leasing, you choose your vehicle from a comprehensive range, with the additional features you want. Then, when you’re ready to change or upgrade, your personal car leasing company provides you with a new car seamlessly and with no stress.
Tips on personal car leasing deals
When considering the best way to have a car, without actually buying it, you should always pay close attention to the contract terms and conditions. Personal car leasing deals vary among providers. A reputable firm will always discuss the ‘ins and outs’ with you and will help you to put together a leasing contract that suits you.
For example, the monthly costs could be tied to the amount of mileage you do. Also, the best personal car leasing contracts have maintenance costs covered, so you don’t face any additional charges for servicing and repairs, for example.
The deal will take account the value of the vehicle (at the start and end of the contract), the timeframe for the lease, and any admin fee involved.
Who is eligible for car leasing
Most individual motorists are eligible for personal car leasing, subject to a check on your credit history. Beyond that, to apply, you will be asked to show a UK driver’s licence and passport, proof of your home address and evidence of a secure and regular income. There will be a few other simple questions you need to answer, for a successful application to lease a car for personal use.
