Amending the Mileage on Your Lease Contract

Here at Nationwide Vehicle Contracts, we are often asked by customers about the option to amend the mileage allowance on a lease contract, otherwise known as a contract amendment.

Mileage is one of the major factors in defining how much your leasing plan will cost, therefore it is vital to choose a mileage allowance that reflects your driving habits. But occasionally customers may want to amend their annual mileage allowance to avoid paying an excess mileage charge.

To help explain the rules surrounding contract amendments, Nationwide Vehicle Contracts has put together a short guide to explain the process involved in a contract amendment including the criteria and the fees involved.

Types of contract amendments may include:

• Mileage extension (e.g. changing annual mileage from 10,000 to 12,000)
• Mileage reduction (e.g. reducing annual mileage from 10,000 to 8,000)
• Term extension (e.g. extending a lease agreement from 24 to 36 months)
• Adding breakdown cover (e.g. adding recovery to your contract for extra peace of mind)

Throughout this guide, we will be specifically looking at the process involved in amending the mileage (increasing or reducing your annual mileage allowance) on your lease contract.

Why would a Mileage Amendment be required?

There are many reasons why a customer may wish to amend the mileage on their lease contract. While we always advise that you choose a mileage allowance that reflects your driving habits at the start of your lease contract, major changes in your circumstances could impact your driving style. Potential scenarios may include:

• Moving home or job in such a way that means you are likely to exceed your agreed mileage
• Use of second car or company car means you’ve not used your lease vehicle as often as expected

It is important to note that any changes to your contract, including mileage amendments, are at the discretion of the finance company and are NOT available for every contract, therefore it is important to find out what your available options are before taking out your initial lease agreement.

What is the criteria for a Mileage Amendment?

The criteria for a mileage amendment varies from funder to funder and from contract to contract. A mileage amendment is subject to several criteria:

• Most finance providers will not allow you to amend the mileage in the first 12 months of the contract.
• Most finance providers will only grant a contract amendment if there are 6 or more payments outstanding on the original agreement.
• Depending on your finance provider, a mileage amendment may not be permitted for customers on a Personal Contract Hire agreement.
• Depending on your finance provider, a mileage amendment may not be permitted for Sole Traders or Partnerships with less than 3 partners.
• For some funders, the mileage amendment must be at least 10% plus of original contract mileage.
• An administration fee of £100 exc VAT will be charged per vehicle mileage amendment request.

Can anyone apply for a Mileage Amendment?

No, because this option is not available with all funders. A mileage amendment is at the discretion of the finance provider and is available on all products. A mileage amendment will also not be permitted where:

• The existing account has arrears or is subject to Default or Insolvency.
• The Modifying Agreement has not been completed in full.

How much does it cost?

In the instance that a mileage amendment is permitted, the funder will also calculate a new rental and will issue you with a new quotation.

Nationwide Vehicle Contracts Ltd also charge a fee of £100 excl. VAT per vehicle mileage amendment request. The contract amendment fee is payable by debit or credit card or by BACs payment and will be taken on receipt of your signed finance documentation detailing the amendment.