UNDERSTANDING LEASING

By Keith Jackman, Marketing Director, Lookers Mercedes-Benz Leasing is a long-term rental agreement offering the exclusive use of a vehicle for a set period of time at a fixed monthly charge. Leasing helps you avoid any unexpected costs by offering a fixed monthly payment for the term of the lease, meaning you don’t have to worry about depreciation or selling the vehicle as this is taken care of by the leasing company.

At the start of a leasing contract, you will pay an initial rental fee - usually equivalent to the sum of three monthly payments - and then make monthly payments for the duration of the contract term. At the end of the contract, usually 24-48 months, the vehicle can simply be handed back without any further obligations.

Driving a new car every two, three or four years is just one of the benefits to leasing. Not only will you be driving a brand new car every few years but leasing also allows you to drive away with fixed lower monthly payments, lower deposits, inclusive road tax and breakdown recovery, flexible contract duration and mileage terms and all vehicles include standard manufactures warranty.

Contract hire is a finance solution available to sole traders, partnerships and limited companies. It’s a very popular choice for VAT registered companies as they can claim back fifty percent of the VAT on the finance element. Rental costs take into consideration estimated annual mileage, selected models and optional maintenance packages. Once the agreed term has finished you can return your vehicle at no extra cost, provided the vehicle has not exceeded its mileage allowance. This leasing option is an excellent choice for businesses with quick changing or updating fleets, who are looking to minimise their short-term expenditure.