Leasing

[johnny bravo]

Any out there that do or have thought of leasing .
What are the pitfalls apart from not owning the van . The price shown . Is this what you pay for your term of leasing.. When they say deposit what does this cover .

 

[Pjj]

Never done it but think the deposit is the vat on the van paid up front

 

[JohnDoeWindows]

I leased a few cars over the years

The price shown is the bare minimum price for the bare minimum mileage etc, you'll find that when you actually apply to lease the vehicle the price will go up.

Obviously there's an excess mileage charge which is quite steep so make sure you overestimate

Any damage that isn't wear and tear they will sting you for, including drilling holes for things like tanks etc so will end up costing you a fortune from a nationwide firm like vanarama - if you were going to do it, you're better off with a local firm, there's one near me called ready rent a van for example so you're talking directly to the man if that makes sense

 

[johnny bravo]

just looking its 1st years payments
5 years @ £283+ vat will bo around £19+ maybe better off buying new instead of leasing . At least if looked after you can recoup by selling . if you will be able to sell diesels in 5 years time

 

[johnny bravo]

just looking the more you look into it the more stress it may bring if any damage occured while leasing . if your own van you can repair or leave it if not affecting the drive
Sounds ok @ £283 monthly £70 a week . + vat

 

[johnny bravo]

think ill stick to ebay as we cant go into the Auctions now only trade

 

[spruce]

Any out there that do or have thought of leasing .
What are the pitfalls apart from not owning the van . The price shown . Is this what you pay for your term of leasing.. When they say deposit what does this cover .

In the old days a vehicle lease on a van would be a 3/35 for a 36 month deal or 3/47 for a 4 year deal.
Example: a 3/35 would be £300 up front and then 35 payments of £100. That figure was always + vat. If you were vat registered you could claim the vat portion back. The finance house also would want to know your annual expected mileage. The higher the annual mileage the bigger the monthly payments. Basically you are leasing a depreciating asset. A van with 30k after 3 years is worth more than a van with 80k.

These days they try to make things look cheaper as they load the deposit (or first installment) and leave a balloon payment at the end. If your van is valued less than the balloon then that's for your pocket. They cover themselves in a couple of ways. If you go over mileage then they charge a penalty for that and will charge for any damage that they don't class as fair wear and tear.

Yes, there are some leases you never own the van and finance law says it mustn't be purchased and used by yourself after the lease has expired, no matter what @dazmond says. Citroen had a lease purchase scheme where you could buy your own van at the end of the contract, but that was 20 years ago. The van was registered in your name from the get go.

I would be careful about Contract Hire.

As with all leases they could penalise you for securely mounting your tank in the back of your van by drilling holes in the floor.

People often thought that leasing was a way of getting a new vehicle if they had a poor credit record. Finances houses were much more strict approving leasing deals than ordinary hp in my day.

It doesn't matter how you finance a vehicle. That vehicle will depreciate whatever finance option you choose. You are financing a depreciating asset.

 

[Iron Giant]

@P4dstar will be able to answer your questions as he leased his van had a tank fitted and may now have bought the van from the lease company

 

[spruce]

@P4dstar will be able to answer your questions as he leased his van had a tank fitted and may now have bought the van from the lease company

@dazmond was told by the salesman that to get around the law he would sell the vehicle to his girl friend and then buy it from her a little later down the line. He would pay the balloon payment to the finance house and the rest would be a paper transaction.

Chances are he could get away with it, but if HMRC do connect the dots then there will be a fine and he would risk an investigation. Whatever they do, he will be flagged up as a person of interest every tax year when he submits his return.

 

[spruce]

@johnny bravo Have a look at this thread

leasing your van

Hi Guys, I need a new van as current one written off. Would you recommend leasing a new for £250 per Month for five years or buying a used van ? I've only got about £2000 Thanks

windowcleaningforums.co.uk

Actually, you participated in it.

 

[scottish cleaning service]

I would like to lease a new van but I don't think they allow you to modify it by drilling holes in the floor and speedlining the floor. If that's the case then we would need to buy a van.

 

[Cghwindowcleaning]

I know people that have leased and put tanks in the back so it can be done.

unless VAT registered and limited I would get a personal loan and buy outright.

 

[matt1458]

My van is on lease, which in 2020 was a good deal and included full maintenance. Negotiated the deal via a broker (if you do it there is zero loyalty from them so just play one off against the other, they’re all competing for the same pool of vehicle stock)

The only thing to be wary of is return charges, I took mine on fully accepting I would need to re ply line it (the “included” ply lining is only basic 3mm or so ply anyway). Fortunately I had a local company build me a tank frame that would use the existing load anchor bolts in the van to save drilling the chassis.

Return condition is based on BVRLA standards which is a bit ridiculous for vans, fair wear and tear is a bit ambiguous and varies by funder. Some of them will still also give you a purchase option at the end of the lease, mine does, but again it’ll depend on funder (and what they want for it)

I’ve leased a few cars and now this van so got a fair idea on how it works, one thing I’ve noticed recently is like all new vehicles lease prices are nuts at the moment.

Bearing in mind mine doesn’t go back until June next year, broker called me a month or so ago saying if I didn’t consider the next one now they can’t guarantee it’ll turn up in time, and the best price I could haggle was over 1.5x the current price.

There are always deals out there but it’s a bit of a minefield and you have to be prepared in advance before the lease finishes. Personally I’m still considering buying what’s best to do when this one comes to an end

 

[matt1458]

Also make sure you understand the difference between lease purchase (no handback options and you HAVE to buy at the end) and contract hire (long term rental with return charges and limited purchase options depending on funder at the end of the term)

 

[spruce]

It's the old saying; you get nothing for nothing, and very little for 6 pence.

At the tail end of the day, the van will depreciate the moment it is registered. In 3 years it will depreciate the same amount no matter how it's financed or paid for. The leasing option for business users was never meant to save anyone money. It was targetted toward the small to medium business community who ran a few vehicles but couldn't justify the cost of a dedicated fleet manager. It was also a way for business to acquire a vehicle and dispose of it after a few years with minimal effort. The motor manufacturers encourage leasing as it provides a ready market for new vehicle sales, and let's be honest, finance houses make more money from leasing deals, especially when they include full maintenance. It also provides the finance houses with a ready-made customer base, as the chances are someone who leases will lease the next vehicle. They also know the exact time frame the customer will have that vehicle for, whereas they have no idea how long you will keep your vehicle if you finance it using HP or a personal loan.

It's very easy to get into leasing with minimal deposit etc, but once someone is on the leasing treadmill, it becomes more difficult to get off. As @matt1458 says, the next deal could well be more expensive. Yes, the price of vehicles has increased considerably in recent years, but what will @matt1458 do? How will he manage his own expectations? Will he still lease again at a higher price to drive a brand-new vehicle, or will he be content to go back to an old banger? How will his customer's react? Will they see him as overcharging if he went from a new van to an old banger?

The motor industry has been very astute here by introducing the leasing option. It's generally to their advantage, not ours.

 

[P4dstar]

I leased my van in 2018. At the time I had a 10 year old Vivaro with 110k on the clock. After 2 replacement gearboxes in 6 months I decided I needed something reliable and signed up to a lease. My Citroen Dispatch cost me £290 per month including vat and a service package and upgrading to 12.5k miles per year. At the time I had 50ish customers equating to a regular income of around £500 per month and had just gone full time so this was a risk. The lease was with LeasePlan.

I had the option to purchase the van at the end of the lease, or continue with monthly payments no contract or extend the contract. I never told them of the modifications, I went one further and had a hot water system fitted in May this year once I had decided to buy the van.

At the time the retail value of the van was 26k. I paid a £1000 deposit and then a further £14000 in lease fees. I then bought the van for £16500. To be honest it wasn't a bad deal in the grand scheme of things. Not sure what they would have made of the modifications had I returned the van at the end. They covered all servicing and repairs in the price and the RFL was paid for me each year.

If I was starting over with this I would purchase a van, on finance if it was unaffordable off the bat, and make all the modifications I feel like. This is something I may end up doing in the new year for van number 3.

 

[P4dstar]

Also just to add Vanarama are known for being massive con merchants. Their trust pilot was shocking when I was van shopping.

 

[scottish cleaning service]

I leased my van in 2018. At the time I had a 10 year old Vivaro with 110k on the clock. After 2 replacement gearboxes in 6 months I decided I needed something reliable and signed up to a lease. My Citroen Dispatch cost me £290 per month including vat and a service package and upgrading to 12.5k miles per year. At the time I had 50ish customers equating to a regular income of around £500 per month and had just gone full time so this was a risk. The lease was with LeasePlan.

I had the option to purchase the van at the end of the lease, or continue with monthly payments no contract or extend the contract. I never told them of the modifications, I went one further and had a hot water system fitted in May this year once I had decided to buy the van.

At the time the retail value of the van was 26k. I paid a £1000 deposit and then a further £14000 in lease fees. I then bought the van for £16500. To be honest it wasn't a bad deal in the grand scheme of things. Not sure what they would have made of the modifications had I returned the van at the end. They covered all servicing and repairs in the price and the RFL was paid for me each year.

If I was starting over with this I would purchase a van, on finance if it was unaffordable off the bat, and make all the modifications I feel like. This is something I may end up doing in the new year for van number 3.

How do you like using the hot water system?

 

[spruce]

Our customer had a Volvo XC90 on order for the past 1 year, signed and locked in. Last month, Volvo cancelled his order along with another 750 other orders throughout the UK. If you want to reorder, no problem. The cost of the car is £8000 more. So he ordered a Polestar. Now he is questioning the decision to go all electric. The moral of the story is that just because you sign up for a van today at today's price, it doesn't mean that you will get that price in a few month's time. You will end up chasing your tail, so we are better off buying or leasing a van which is available in stock when you need it.

The decision to go electric was made before all the drama over the energy costs. The leasing company has provided him with a Mercedes 250e until March next year when his new vehicle is supposed to arrive.

With the Merc he says his battery mileage is 40 miles before the engine kicks in. It costs him £3.50 to fully recharge it today. This car also has regenerative braking. However, with current electricity costs, the amount he can claim against tax for business use is 4p a mile less than it is costing him. He is in credit with the petrol side of the claim, though, by a couple of pence per mile. If he charges his car at a motorway charge point, it will cost him twice the price it does to charge at home currently.

With the new energy prices, the cost of charging an electric vehicle isn't going to be much less than filling the diesel tank of a diesel car. He says we haven't even considered depreciation on an ev or resale value after 4 years.

He confirmed what we said earlier. His company has 250 cars throughout the UK on lease. He is in charge of them along with his other responsibilities, sales related. He does very little vehicle management as the lease does everything; maintenance, tyres; road fund licence, the lot. But he says it costs them money; it isn't cheap. Even with the additional costs, leasing makes sense as they don't need a dedicated fleet manager; the leasing company orders the car and disposes of it at the end of 4 years.

 

[scottish cleaning service]

Our customer had a Volvo XC90 on order for the past 1 year, signed and locked in. Last month, Volvo cancelled his order along with another 750 other orders throughout the UK. If you want to reorder, no problem. The cost of the car is £8000 more. So he ordered a Polestar. Now he is questioning the decision to go all electric. The moral of the story is that just because you sign up for a van today at today's price, it doesn't mean that you will get that price in a few month's time. You will end up chasing your tail, so we are better off buying or leasing a van which is available in stock when you need it.

The decision to go electric was made before all the drama over the energy costs. The leasing company has provided him with a Mercedes 250e until March next year when his new vehicle is supposed to arrive.

With the Merc he says his battery mileage is 40 miles before the engine kicks in. It costs him £3.50 to fully recharge it today. This car also has regenerative braking. However, with current electricity costs, the amount he can claim against tax for business use is 4p a mile less than it is costing him. He is in credit with the petrol side of the claim, though, by a couple of pence per mile. If he charges his car at a motorway charge point, it will cost him twice the price it does to charge at home currently.

With the new energy prices, the cost of charging an electric vehicle isn't going to be much less than filling the diesel tank of a diesel car. He says we haven't even considered depreciation on an ev or resale value after 4 years.

He confirmed what we said earlier. His company has 250 cars throughout the UK on lease. He is in charge of them along with his other responsibilities, sales related. He does very little vehicle management as the lease does everything; maintenance, tyres; road fund licence, the lot. But he says it costs them money; it isn't cheap. Even with the additional costs, leasing makes sense as they don't need a dedicated fleet manager; the leasing company orders the car and disposes of it at the end of 4 years.

There was a nice racket going about with mobility cars. They took then to a well known garage for servicing and tyres. They were changing the tyres and they still had the hair on the side and then flogged the old tyres as runners. It was great till they got caught and many folk lost their jobs.

 

[Pjj]

Our customer had a Volvo XC90 on order for the past 1 year, signed and locked in. Last month, Volvo cancelled his order along with another 750 other orders throughout the UK. If you want to reorder, no problem. The cost of the car is £8000 more. So he ordered a Polestar. Now he is questioning the decision to go all electric. The moral of the story is that just because you sign up for a van today at today's price, it doesn't mean that you will get that price in a few month's time. You will end up chasing your tail, so we are better off buying or leasing a van which is available in stock when you need it.

The decision to go electric was made before all the drama over the energy costs. The leasing company has provided him with a Mercedes 250e until March next year when his new vehicle is supposed to arrive.

With the Merc he says his battery mileage is 40 miles before the engine kicks in. It costs him £3.50 to fully recharge it today. This car also has regenerative braking. However, with current electricity costs, the amount he can claim against tax for business use is 4p a mile less than it is costing him. He is in credit with the petrol side of the claim, though, by a couple of pence per mile. If he charges his car at a motorway charge point, it will cost him twice the price it does to charge at home currently.

With the new energy prices, the cost of charging an electric vehicle isn't going to be much less than filling the diesel tank of a diesel car. He says we haven't even considered depreciation on an ev or resale value after 4 years.

He confirmed what we said earlier. His company has 250 cars throughout the UK on lease. He is in charge of them along with his other responsibilities, sales related. He does very little vehicle management as the lease does everything; maintenance, tyres; road fund licence, the lot. But he says it costs them money; it isn't cheap. Even with the additional costs, leasing makes sense as they don't need a dedicated fleet manager; the leasing company orders the car and disposes of it at the end of 4 years.

It’s also interesting to note that at the moment charging cars per kw is the same as the electric charge for your house , but the government have already said that electric for charging cars will be charged at a higher rate in the future and you will have no choise but to have a special charging point put in which will have its own electric meter . They will probably wait until more have electric cars before implementing it so as not to put too many off going down the electric route