Vauxhall Business Funding
Please call our specialists today: 01933 443403
Why Lease Rather Than Buy?
With new vehicle prices continually rising and the residual value of used vehicles falling, the monetary cost of owning a car is on the increase. Because of this trend, it is widely accepted that there is little or no benefit in purchasing most new vehicles outright due to steep depreciation of the asset. For this reason more and more of today’s forward thinking companies are looking for a better financial solution to vehicle acquisition.
Choosing one of our lease options will give you the right to use a vehicle be it car or commercial on pre-agreed terms. With fixed term and low monthly rental they allow for accurate company budgeting, minimal administration and improved cash flow.
Contract Hire is the leasing of a vehicle, normally to a vat registered business, for a set time and specified mileage. At the end of the contractual period the vehicle is returned to the supplier.
The client is required to pay a fixed amount each month over the life of the contract with an initial fee, usually equivalent to three months rental, required up front. Roadside rescue, maintenance, and relief vehicle provision are optional extras, which can be included and charged to the monthly rental payment.
Contract hire removes all the risks associated with vehicle ownership- depreciation, servicing, disposal etc, and because the vehicle(s) is owned by the finance company it does not have to be shown as an asset on the company’s balance sheet, giving improved financial gearing for core business investment.
Contract Purchase. This method of funding is ideal for companies who cannot fully reclaim vat and is particularly suitable for financing the more expensive cars on the fleet. It offers all the operational and managerial benefits of contract hire together with the tax-efficient benefits of ownership, such as the ability to claim capital allowances.
The client makes fixed monthly payments over the life of the agreement with an initial fee usually equivalent to three months rental up front and at the end of the contracted period have the opportunity to buy the vehicle by paying a final pre-determined balloon payment, legally transferring ownership to them. Although this method protects the client from the risk of depreciation they will still be exposed to the risks inherent in administering, maintaining and in particular, disposing of a fleet.
Finance Lease is a vat free method of financing a vehicle traditionally used by VAT registered companies. It allows you many of the benefits available from Contract Hire whilst the risk and responsibility of the disposal of the vehicle at the end of the lease period remains with you.
A Finance Lease can be structured in two ways, you can either choose to pay the entire cost over the agreed lease period plus interest charges or you can pay lower monthly payments with a deferred “Balloon” payment at the end of the agreed term.
As a form of lease, ownership of the vehicle remains solely with the supplier. However the surplus proceeds from the sale of the vehicle (whether you opt to sell the vehicle or ask the supplier to sell it on your behalf) go to the client.
Lease Purchase is a method of financing a vehicle, normally for vat registered companies or businesses, it allows a business to acquire ownership of the vehicle at the end of the contract agreement once the “option to purchase” final payment has been made. The monthly rental is determined by the cost of the vehicle, the agreement period and the estimated future value of the vehicle, which is based on the proposed annual mileage. Maintenance packages are usually available if required.
Lease purchase is a cheaper monthly alternative to hire purchase, the traditional method of financing, and is written on a hire purchase agreement with the protections afforded by the consumer credit act.
Quick Links: Vauxhall Agila, Vauxhall Astra, Vauxhall Antara, Vauxhall Corsa, Vauxhall Insignia, Vauxhall Meriva, Vauxhall Vectra, Vauxhall VXR, Vauxhall Zafira, Vauxhall Corsavan, Vauxhall Astravan, Vauxhall Combo Van, Vauxhall Vivaro, Vauxhall Movano
