Pick-Up Finance

MW Vehicle Contracts are appointed credit brokers of five of the top leasing and contract hire companies in the country, including Network Vehicles (part of the worldwide LeasePlan brand), Lex Vehicle Leasing, Alphabet, Arval and Hitachi. MW Vehicle Contracts are also proud members of the BVRLA (British Vehicle Rental and Leasing Association). Below you will find a brief overview of the differences between the main finance options for vehicle leasing. If you would like a more in-depth analysis of the options available to you, please do not hesitate to contact us

Contract Hire (CH)

Ideal for companies who need vehicles on a fixed monthly budget with the option of including maintenance. At the end of the term you simply hand the vehicle back with no risk of any short fall in the vehicle value.

Main benefits of Contract Hire include:

  • Fixed rentals for the whole package, making budget planning easier.
  • Flexible terms to meet your requirements with variable duration and mileage terms.
  • Road Fund Licence included for the duration.
  • Servicing and maintenance costs can be included in the monthly rentals.
  • Contract hire removes depreciating assets from the balance sheet and the associated risks of owning a vehicle(s).
  • In the case of VAT registered companies, a percentage of the VAT on each rental can be reclaimed

Features to be aware of:

  • No option to purchase or own the vehicle at the end of contract.
  • Early termination will end the agreement but will not result in ownership
  • Possibility of excess mileage charges if the vehicle is returned with a higher mileage than stated on the contract.


Personal Contract Hire (PCH)

Very similar to business contract hire, personal contract hire (PCH) is based on a fixed term contract where customers pay an agreed monthly charge for the use of a vehicle for a previously agreed period.

Main benefits of Personal Contract Hire

  • Fixed rentals for the whole package, making budget planning easier.
  • Flexible terms to meet your requirements with variable duration and mileage terms.
  • Road Fund Licence included for the duration.
  • Service and maintenance costs can be included in monthly rentals.
  • No depreciation or disposal risks at the end of contract.

Features to be aware of:

  • Vehicle must be returned in a well maintained condition
  • Early termination can be expensive
  • You must have fully comprehensive vehicle insurance
  • You will never own the vehicle


Contract Purchase (CP)

For companies who want their own vehicles but who want to avoid any risk of depreciating assets

Main benefits of Contract Purchase include:

  • Similar benefits to contract hire - fixed payments and flexible agreement terms.
  • Servicing and maintenance costs can be included in the monthly payment.
  • The finance company guarantees the resale value of your vehicle at the end of the contract purchase agreement for a known and fixed amount.
  • Ownership passes to the customer (you) at the end of the agreement after all payments have been made.

Features to be aware of:

  • Large final payment, based on vehicle predicted value to take ownership.
  • Road fund license for first 12 months only.


Finance Lease (FL)

Finance lease- How it works

The final rental is pre-set at the start of the agreement and calculated according to the contract term and anticipated mileage.

At the end of the agreement you will have a number of options:

Option 1: Trade the vehicle in with us for a new one. Depending on the condition and final mileage, we would offer a value that could exceed the final balloon rental**

Option 2: If you want to retain the vehicle for a further period, some of our funders offer a straight forward re-finance option.

Option 3: You can sell the vehicle to a third party. You will retain any equity** after the final rental and any proceeds of sale fee from the funder have been paid.

Option 4: At the end of the agreement you can pay the final rental and retain the vehicle. The funder will charge a single annual secondary rental fee (sometimes also called a peppercorn rental) until such time as the vehicle is sold. A proceeds of sale fee may then be payable to the funder.

**At the end of the agreement there are no direct charges for excess mileage or damage to the vehicle. However there could be a shortfall (the difference between the sale price achieved and final rental) at the end of the agreement depending on market conditions and also if the anticipated annual mileage is considerably exceeded or the vehicle disposed of with extensive mechanical or bodywork issues.

Optional maintenance contract includes Routine service requirements as per the manufactures scheduled guide lines, Maintenance items, Replacement tyres and MOT tests. (Further details available upon request)

Main features and benefits include:

  • Finance Lease is a tax efficient option where you choose to pay either the entire cost of the vehicle (known as fully amortised lease) including charges, over an agreed lease period or opt to pay lower monthly rentals with a final rental based on the anticipated resale value of the vehicle (residual value).
  • At the start of the contract usage parameters (term and mileage) for the vehicle are agreed. Assuming this does not change, the monthly rentals are fixed for the full duration of contract. You benefit with fixed costs but do take on the administration and operating risks. At the end of the contract you may continue to operate the vehicle under a annual secondary rental charge, although at no time take ownership of the asset, and must sell on to a third party.
  • No damage recharge as you are responsible for disposal of the vehicle.
  • Finance lease has advantages for VAT registered companies and businesses as they can reclaim 50% of the VAT on the finance element for cars and up to 100% for commercial vehicles (subject to no private use). 100% of vat on the (optional) maintenance element of contract rental can be reclaimed.
  • Optional full maintenance packages (dependant on funder)

Features to be aware of:

  • You will never own the vehicle as the vehicle must be sold to a third party as the end of the agreement
  • Operating risk associated with the vehicle


Lease Purchase (LP)

Main benefits Include:

  • Lease Purchase is an agreement designed to offer vehicle funding where the customer (you) wishes to purchase the vehicle.
  • As the vehicle will appear on balance sheet, you benefit by having a 'writing down' allowance against your tax liabilities, either all in the first year or spread over a number of years.
  • A very cheap way of buying a vehicle as you attract full fleet discounts that we pass on to you.

Features to be aware of:

  • The customer (you) is liable for the full value of the vehicle with no option to return at the end of the agreement.
  • Lease purchase does not include maintenance or any other services.


MW Contracts only employ fully qualified and certificated finance specialists (ask other companies if they can say the same?). Please call for free valuable advice. Members of the BVRLA - there to protect you! We are proud to be a Network Platinum Broker.