Nationwide Vehicle Contracts provides expert advice to help readers avoid common pitfalls when leasing.
Considering leasing a car but not sure how the process works? There's no denying the experience can be stressful, but take on our advice, and you'll save time and money in the long run.
In this blog, we'll provide expert advice on the do's and don'ts of car leasing to help ensure a stress-free leasing experience.
Dos
Do Your Research
Kick off the leasing process by doing your research. Compare rates with competitors and carefully choose what car you want. Consider your preferences, such as budget, engine type, interior quality, and practicality.
Once you know what you're looking for, it will make it much easier to start.
Understand Your Budget
Calculate your monthly budget for lease payments by analysing your incomings and outgoings to ensure you know how much you've got left over. Remember to consider insurance and maintenance costs.
You'll also need to think about car running costs such as fuel. According to NimbleFins, the average motorist spends just under £100 a month on fuel, so ensure you include this in your budget.
Read the Lease Agreement Carefully
Before you agree to any lease deal, ensure you've fully read and understood the lease agreement. Review all the terms and conditions, and ensure you know the fees you'll be paying and when you'll be paying them.
If you don't understand anything, seek the advice of your sales representative, who will be happy to help.
Maintenance Matters
When you get your lease car, ensure you follow the manufacturer's maintenance schedule to keep your car in good condition. This will ensure your lease car's engine is running smoothly and will fix any faults before they cause lasting damage.
As well as helping you stay on the road, adhering to the manufacturer's maintenance schedule will save you money in the long term by reducing the chance of your car breaking down, which is very costly and frustrating.
You should also keep a record of your maintenance and repairs to avoid disputes at the end of your contract term.
Consider GAP Insurance
GAP insurance covers the difference between the vehicle's value and what you owe if it's written off. It's beneficial to add GAP insurance to your lease agreement as it protects you from financial detriment, protects your savings, and enables you to set up a new lease immediately and get back on the road.
In the event that your lease car is written off, GAP insurance will save you a lot of time, effort, and money.
For more information, check out our comprehensive GAP Insurance Explained guide.
Don'ts
Don't Focus Solely on the Monthly Payment
Avoid making decisions concerning your lease agreement solely based on the monthly payment. You must remember that there are other costs, such as the deposit, processing fee, and any extras, such as maintenance and GAP insurance.
Also, consider that a lower monthly payment will come with a higher upfront deposit, so it might cost you more.
Don't Ignore Mileage Limits
If you exceed your mileage limits, you'll be subject to excess mileage charges at the end of your contract term, which could prove costly. Charges vary depending on your finance provider but typically range from 3p to 30p per mile.
Consider how many miles you'll drive annually before you take out your contract to ensure you select the correct number of miles.
Don't Ignore Wear and Tear
Wear and tear is one of the most important things you need to consider when you get your lease car. When returning it to the finance provider, you must ensure the car adheres to fair wear and tear principles.
We'd suggest keeping up with the manufacturer's maintenance schedule and regularly cleaning the interior and exterior of your lease car thoroughly.
For more information, check out our Leasing Wear and Tear Guide.
Don't Assume You Can Simply Exit Early
A car lease agreement is a legally binding long-term contract where you're expected to make monthly payments. If something changes and you can no longer continue with your lease, terminating your lease agreement early can be costly and challenging.
With an early termination, customers can arrange a fee with the finance provider and return the vehicle. Most finance providers charge a fee of 50% of outstanding rentals, so that an early termination could be seriously expensive, depending on your situation.
You must explore all options before deciding to terminate your contract early.
Looking to secure a car lease deal? Nationwide Vehicle Contracts is one of the UK's largest car leasing brokers, offering a range of leasing deals to suit your every need.
Originally posted: 22nd September 2023
