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Extending Your Car Lease Contract

If you're nearing the end of your car leasing contract, you may want to know what your options are regarding extending your lease agreement. 

To help you to understand the options available to you, Nationwide Vehicle Contracts has put together a short guide to explain the different types of contract extensions available, as well as the criteria, fees and the process involved in extending your lease agreement.

Woman on the phone reading a contract

Can a car lease be extended? 

Most finance providers will allow you to extend your car lease contract for an agreed period. However, this ultimately depends on your lease provider and the type of lease agreement you have.

What is a car lease extension?

A car lease extension is an agreement between you (the customer) and the finance company to extend the term of the lease contract beyond its original end date. 

With a vehicle lease agreement, there are two types of contract extensions:

  • Informal Extension
  • Formal Extension

What is an Informal Extension?

As the name suggests, an Informal Extension (also known as Extended Hire or a rolling contract) is an informal agreement in which the customer continues to use the leased vehicle beyond the contract end date until collection is requested

Informal Extension is a short-term solution designed to help bridge the gap between lease agreements and, as such, is not available with every finance provider. With an Informal Extension, the finance provider has the right to recall the vehicle at any time.

What is a Formal Extension? 

A Formal Extension is a formal agreement between the finance company and the customer, which allows the customer to extend the lease contract for an additional term, usually six or 12 months. 

With a Formal Extension, a modifying agreement is sent to the customer detailing the extended term, extended-term date and extended mileage agreement, along with the revised monthly rental. 

What is the difference between an Informal Extension and a Formal Extension?

There are several differences between an Informal Extension and a Formal Extension. The best option for you depends on your needs and circumstances and the type of extension available with your finance provider. 

The table below details the key differences between extension types. 


Formal Extension Informal Extension
Admin fee applies Y N
New contract end date YN
Monthly rental changes Y – rentals may be lower
Y – rentals may change
New initial rental required NN
Peace of mind motoring Y N – as funder can recall vehicle at any time
Road tax included Y N

What are the advantages of extending a car lease? 

There are many advantages to formally extending a car lease contract. 

Perks of extending a car lease include:

  1. graphic of car lease extension deals

    Special extension deals

    Some finance providers offer special extension deals which can reduce your current monthly rentals by up to 10%. 

  2. graphic of initial rental fees

    No initial rental required

    Unlike a new car lease deal, an initial rental is not required for a lease extension, meaning you do not need to find hefty up-front costs. 

  3. graphic of personal car lease customer considering finance eligibility

    No credit checks required

    Unlike a new lease agreement, a credit check is not needed when arranging a formal lease extension. 

  4. graphic of clock showing time passing

    Time to decide

    A car lease extension gives you the time to consider your options while removing the uncertainty of being left without transport when your current vehicle lease hire ends.

  5. graphic of road tax

    Road tax included

    Road Fund Licence is included for the length of the extension and will be automatically renewed by the finance provider. 

  6. graphic of known vehicle history

    Known vehicle history

    A car lease extension gives you extra time with a vehicle you're already familiar with.

  7. graphic of money and calendar

    Time to budget

    A car lease extension gives you more time to save for a down payment or initial rental for your next car.

What are the disadvantages of extending a car lease? 

As with every type of contract amendment, extending a car lease also has its disadvantages.

Downsides of extending a car lease include:

  1. graphic of admin fees

    Admin fees apply

    Extending the lease contract may incur admin fees, payable at the start of the extension process. 

  2. graphic of lease car service

    Servicing and maintenance obligations

    You need to continue to service and maintain your lease vehicle in line with the manufacturer's guidelines during the extension period. This is the case for both informal and formal extensions. 

  3. graphic of car MOT

    MOT may be required

    If your vehicle is over three years old, it will require an annual MOT at your cost unless you have taken out a vehicle maintenance package

  4. graphic of vehicle warranty

    Vehicle warranty may have expired

    If your vehicle is over three years old, the manufacturer's warranty may have expired, meaning you are without cover.

  5. graphic of vehicle breakdown

    Breakdown expired

    Depending on the period of cover offered by the manufacturer, the vehicle's breakdown cover may have expired, meaning you are without cover in the event of a breakdown. 

  6. graphic of early termination fees

    Early termination fees

    An early termination fee may apply if you decide to return the vehicle before the end of the extension contract. 

  7. graphic of car wheels

    Vehicle wear and tear

    It's essential to check any items that may experience wear and tear and may need replacing, such as tyres and windscreen wipers. 

Am I eligible for a car lease extension? 

A car lease extension is at the discretion of the finance provider and is usually only allowed on Personal Contract Hire (subject to finance provider) and Business Contract Hire agreements.

A car lease extension will not be permitted where:

  • The vehicle is not in the final 90 days of the contract
  • A request has been submitted to add or remove maintenance, or a relief vehicle
  • The customer is in arrears or is subject to Default or Insolvency

How much does it cost to extend a car lease?

For Informal Extensions, you will need to contact your finance provider directly to confirm the costs associated with an informal extension. You can find out the contact details for your finance provider by logging into your online Customer Account

For Formal Extensions, we charge an admin fee of £100 excl. VAT for a six-month extension and £125 excl. VAT for a 12-month extension, subject to approval by the finance provider. This fee represents the costs incurred by Nationwide Vehicle Contracts for processing the extension on your behalf. 

The contract extension 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. 

Who handles the car lease extension for me?

All Informal Extensions are handled by the finance provider so you will need to contact them directly to see if you are eligible for an Informal Extension.  You can find the contact details for your finance provider by logging into your online Customer Account

For Formal Extensions, if your current lease contract is with ALD Automotive (for Contract Hire only), Arval UK, Novuna Vehicle Solutions or Leaseplan, Nationwide Vehicle Contracts will handle the contract extension process for you. To request a Formal Extension, please follow the instructions below. 

All other finance providers, including Lex Autolease, are handled by the finance provider, so you will need to contact them directly to request an extension quotation. 

I want to extend my car lease contract, what do I do?

  1. 1 Check Eligibility

    Before requesting a contract extension, please read through the criteria above to ensure you meet the requirements before contacting us. Specifically, we ask you to check that you are within the last 90 days of your lease contract and up-to-date with your vehicle payments.

  2. 2 Contact Nationwide Vehicle Contracts

    Contact the Nationwide Vehicle Contracts team on 0345 811 9595 or email our Extensions team to request a Contract Extension. Please include:

    • Your vehicle registration number.
    • An accurate current mileage at the time of the request.
    • The total mileage you require (the total mileage for your current contract plus the mileage you need for the extension period).
  3. 3 Request Extension with Finance Provider

    We will contact the finance provider to see if you are eligible for a Contract Extension and will be in touch to advise accordingly. Please note a car lease extension is at the discretion of the finance provider, and the finance provider is not obligated to approve any extension request.

  4. 4 Extension Documents Sent

    If you are eligible for a lease extension, the new Modifying Agreement will be sent to us by the finance provider, along with any accompanying Terms and Conditions. We will then email these across to you. Please check the documentation carefully to ensure everything is correct.

  5. 5 Check and Sign Agreement

    Please follow the instructions in the email, sign the Modifying Agreement and return the documentation as requested. Please note the signed paperwork must be returned to us before the expiry date highlighted on the documentation. 

  6. 6 Review Documentation

    Once we have received the signed documentation, we will send this to the finance provider for review. Please allow three to five working days for this to be received and reviewed by the finance provider. 

  7. 7 Date Effective

    Once the finance provider is in receipt of the documents, we will inform you of the new contract end date. You must continue to pay the monthly rentals until the Contract Extension is completed and a new contract end date is given to you.

How long does a car lease extension take?

The process involved in a car lease extension can vary from case to case as it is often dependent on the finance provider. We advise that the process can take up to four weeks from beginning to end, so please bear this in mind when contacting us.

Want to know more about extending your car lease contract?

Still have a question about extending your lease contract? Call Nationwide Vehicle Contracts on 0345 811 9595 to speak to one of our extension specialists, or visit our Motoring Guides hub for further details about the options available to you. 

Excess Mileage Charges Explained Returning Your Vehicle at the End of the Lease

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