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When it comes to your next vehicle, you might be bamboozled by all the different funding options and not know which one is best for you. Here at MWVC, we consider ourselves very well versed in all leasing and funding options, and we want to help take the headache out of it for you. By reading this article, we hope that you will gain a better understanding of your options and the terminology, which in fairness can be confusing and sometimes misleading.
Just the wording of ‘Leasing’ and ‘Hiring’ can lead to confusion, to hire a vehicle you will effectively be borrowing it for a very short term, maybe a day or two until the job is done. Leasing is about having the use of a vehicle for a number of years and are responsible for running it and insuring it. A short term hire from businesses such as Enterprise or Herts would not be cost-effective or tax efficient if you were running that vehicle for a number of years.
When looking around our website, you may notice that both ‘hiring’ and ‘leasing’ are used interchangeably within the car industry and sometimes meaning the opposite of what you might expect.
We want to keep things as simple as possible, which can be difficult when we offer so many different options, which is why we always ask that you contact us to talk about your options as each customer's situation is unique, and we want to offer the best deals for you.
At MW Vehicle Contracts, we pride ourselves at being able to offer a wide range of finance options to customers; both business and personal, to ensure that we are able to provide quality vehicles to just about anyone. We have a number of guides and videos on our website that help to explain the different finance options that are available.
So which is the best option? Leasing, in terms of vehicles, means that you will never own the vehicle. You agree to a set monthly rental and the length of the contract that you want, and when that is completed you return the vehicle, and you are free to start another lease. This is called Contract Hire - see how confusing it can be, as the word ‘hire’ is used, but really it is a lease as you won’t own the vehicle at the end, - and this can be for Business (BCH) or Personal (PCH) leasing. You can read more about it in the blog article What is Contract Hire?.
Leasing is sometimes the best option as you can always ensure that you have a new vehicle, and you have the option of adding maintenance into the pricing so you don’t have to worry about any other costs for the duration of the lease, and then when it is over you just upgrade and start again. Your vehicle will most likely always be within the manufacturer's warranty and be covered if anything were to go wrong at any point, and the maintenance package bridges the gap if your contract goes outside the warranty.
As a business, there is also another way that you can finance your new vehicle, and that is with Finance Lease. This can sometimes be confusing, and we have a PDF for you to read if you need more information. Hopefully we can give you some of the important points to help clear any confusion.
Finance Lease has some fundamental differences to Contract Hire and HP, for starters you do not have to stick to a certain mileage, or worry about every small mark as you are not returning the vehicle and there is no penalty charge for condition or excess mileage. Finance Lease can be a viable option for your business as it offers some great tax savings, big vehicle discounts and flexibility. Prices are quoted without VAT and if you are a VAT registered business then you may be able to claim 100% of the VAT back. Like Contract Hire, you set out your initial rental, and you have a set monthly rental for the duration of the predetermined term of the lease.
What is different is at the end, where there is a large final rental. This final payment is based upon the predetermined mileage and condition of the vehicle as discussed at the start of the contract, so you are not paying more than the vehicle is worth. You can sell the vehicle to anyone, family, friend, or in some cases even back to us. If you sell for more than the cost of your final rental, then you get to keep the profits (after a small sales fee) and you can start the process all over again with a brand-new vehicle. We have a short video on our site that helps explain all this.
As with all the other finance options, we know that it can be complicated, and we always recommend that you call us so that we can discuss the different options with you and explain in more detail anything that you may not fully understand. Our staff are fully trained and will work to ensure that you get the best deal they can possibly give you.
We are proud members of the BVRLA (British Vehicle Rental and Leasing Association) which helps to set out guidelines and accountabilities to ensure that we provide the best possible service to you and that both parties are protected by laws and legislation. Legislation that ensures that we inform you, the customer, of your obligations during the term of your contract, whether leasing or hiring, and that you are aware of our obligations and duty to you. A copy of the guidelines is available to download from the BVRLA site, or we can email you a copy if requested.
Terminology can be confusing, but please don’t be afraid to ask if you are unsure about anything. Hire, lease, Contract Hire, Hire Purchase or Finance Lease. The funders that we work with look at every application, and we work with them to ensure that the best deal is put forward to you. Hopefully some of the terminology has been cleared up for you and you are able to make a clearer decision when it comes to funding your next vehicle purchase. Our special offers also give you an even better deal on your next vehicle of choice.
We want to ensure that you have the best service and the best deal going, and we work hard to ensure that that happens. Our staff here at MWVC will go above and beyond to ensure that you get the right finance for you, we are always on the end of the phone if you encounter any problems, yes we all know that filling in the finance form can be a pain, but we will help you any way that we can. All our quotes are tailor-made and unique to you and your business or personal needs.
