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Finance Methods for Car Leasing 30
Aug

Car leasing companies have an array of different finance methods for the convenience of hirers. These methods are suitable for both personal and business leases.

Contract Hire is a lease that includes a fixed monthly rate for a certain term and a limited mileage. The cost may vary depending on the value of the car, the period and the mileage, as well as the anticipated depreciation in value. Sometimes, companies bundle these deals with an optional maintenance package.

The Contract Purchase is actually a rent-to-own arrangement with a fixed monthly rate. Customers that use this method are usually persons or companies that invest in and eventually gain ownership of the car without taking the depreciation risks normally associated with ownership. Similar to Contract Hire, a maintenance package is available with a contract purchase.

Another method is Lease Purchase or Hire Purchase. The monthly payment is determined by the deposit paid, the period of the contract and the sale price of the vehicle. It is similar to Contract Purchase, where the vehicle becomes the property of the hirer, but the monthly rate may vary according to agreement.

The Finance Lease is an option that allows the hirer to pay either the whole cost of the vehicle over an agreed term, or with a lower monthly rate, with the final payment based on resale value.

Some companies have the Sale-and-Lease-Back option, which allows a person to own a vehicle outright, purchased from the leasing company, by means of transferring capital to a contract hire or leasing agreement.



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