Understanding business car leasing

Nowadays more and more businesses are opting to lease a vehicle. It simply makes great financial sense for a small business; no large outlay of cash, no lifetime commitment and make other benefits. Many businesses have to either transport goods or need to provide sales staff with reliable and presentable transport. Being able, with some leases, to get a new car every year is a big incentive. You should check out Leasing4Business if you want to find some of the best deals out there. There are a number of different options available for businesses when they choose a lease, here are two of the most popular types of leases explained for you.


Personal contract purchase (PCP)

This is a personal contract hire but with an option to buy the vehicle at the end of the lease period. Shop around for the best deals on the market, take a look at www.leasing4business.co.ukfor some of the best deals on the market.You will pay the same deposit and monthly payments as you would with most other lease agreements, but you ail also agree a minimum guaranteed future value of the car. The amount that you agree on is usually known as the balloon payment, is given to the company if you would like to go ahead and purchase the vehicle. You are under no obligation to purchase the vehicle, you can instead opt to use the balloon payment as a deposit on the next lease vehicle you take. This type of car leasing deals is not as cheap as other deals out there, but it does mean that you’ll probably get a nice car. You will need to take out some comprehensive insurance with this car as well. Remember not to over the agreed mileage limit, doing this can result in penalties, it rarely happens but just remember not to do it.

Hire purchase (HP) and Conditional Sale

Hire purchase is a well known form of credit, it has been around on the high street for many years now, and now you can use it for car leasing deals. For those that don’t know, this is simply a deposit that is followed by monthly payments which you pay, until the car’s value has been paid off in full. This of course includes interest, but once this is all done you will own the car. So you will technically be leasing the vehicle whilst you pay for it. The interest is generally not too high because your credit is secured against it, that is unless your credit rating is bad. Shop around for the best deal out there. It is worth noting that usually HP will come with a big ‘option to purchase’ payment if to complete the contract, whereas conditional purchase does not.


Understanding business car leasing
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