Should I lease a vehicle and have I ever leased a vehicle and not known it?
By GB Vehicle Leasing
Often a vehicle is one of the most valued possessions you own and finding the ideal vehicle for you is exciting to say the least. However, a large percentage of the population are unaware of the various methods of acquiring a vehicle, in particular leasing. Therefore, we’ve decided to explore some of the misconceptions of vehicle leasing and provide an overview of what leasing actually is based on our extensive experience in the industry.
Various Methods of Funding
Regardless of the situation, often people are reluctant to explore new routes, and instead decide to stick with familiar territory, such as buying a vehicle over leasing. Also, when speaking to customers, we regularly find that people assume leasing is just one method of funding. This lack of understanding about leasing (and the various funding methods available) along with the unfamiliar territory, can deter some motorists from even considering this option. This is why, when speaking to potential customers, we feel it is key to thoroughly explain what leasing is and the various funding methods. View our slideshow below for more information about the methods of funding.
Methods of Funding by Charlotte Kennedy
How do the finance companies work out the payments?
With all methods of funding, (whether that be personal or business), the finance companies work out the payments by reverse engineering how the vehicle depreciate.
Do you ever own a car?
Furthermore, when speaking to customers, we're often asked “will I ever own the vehicle?” or they’re concerned that they’ll never own the vehicle. But our response is, “Do you ever actually own a car?” By this we mean, unless you buy a car and run it into the ground until it’s basically worth nothing, (which could take 30 years), then do you ever own it? Yes, you originally bought the car but usually after several years, you’ll sell it. Therefore, it’s the difference between the original buying price and present selling price that you should bother about. (See previous example)
Leasing vs Buying
If you usually make price-driven decisions, then here is where things get a little more interesting. We’ve created an infographic which compares the expense of leasing an Audi A3 Sportback with buying the car instead. Our aim is to highlight to importance of looking at the bigger picture and taking the time to make an informed decision.
Key Benefits of Leasing
When buying a vehicle, do you ever look ahead and consider how much you will sell it for? Most people would respond ‘no’ to this question. The majority of consumers will mainly focus on the buying price of the car that it will be so far in the back of their mind what the selling price in several years will be. However, with leasing one of the main benefits is that the job of selling the car and picking up the tab for depreciation is the responsibility of the finance company. This means with leasing, consumers are aware of how much the car is going to cost them over the term of the lease, whereas when buying a car, you don’t know this. Ultimately, leasing allows the consumer to pass this risk over to the finance company.
Another main benefit of leasing is generally the finance company is going to get more discount on the vehicles than you will ever get. For example, if a car costs £20,000 then the finance company might get the car for £17,000 due to them buying in mass quantity. Therefore, their purchasing power is much stronger than that of an individual, even if the consumer has cash available to make the purchase. This benefits the consumer because it can reduce your monthly payments due to the finance companies’ discounts.
Also, as a reputable leasing broker, we offer bespoke and competitive quotes to suit the customer’s requirements. Whether you’re a business or individual, leasing offers the flexibility of choosing an appropriate contract term for you (typically two or three years). Of course, these are just some of the main benefits to leasing, however it’s easy to see why leasing is becoming an increasingly popular option.
A leasing broker is essentially ‘the middleman’ between the customer, the motor manufacturers and the vehicle funders. The leasing industry is regulated by the Financial Conduct Authority and is controlled by the British Vehicle Rental and Leasing Association. There’s a focus on professionalism, honesty and integrity within the leasing industry.
As a BVRLA FCA accredited Leasing Broker member we are quality assured and operate under a strict code of conduct. This reassures you that you are dealing with a reputable company that will offer the highest levels of service. Furthermore, clients deal with a broker system (rather than directly with funders) and this gives customers independent advice. We are able to use the best and most appropriate finance panel for you from a wide panel of funders. Whereas, dealers only generally have one finance company they can use.
At GB Vehicle Leasing, our team are here to guide you through the leasing process, answering any questions you have. With unrivalled customer service, we are here to help both businesses and personal customers with all your car and van leasing needs. So, would you consider leasing a vehicle? If the answer is yes, why not give us a call on 0161 762 5680 and we would be delighted to help you.