Car Leasing LVM Information

The Car Leasing LVM Process

You decide on the car you want and negotiate your best price with your broker (or get a pre-arranged price or special lease deal). The broker will calculate your monthly payment based on the negotiated price and other non-negotiable factors, such as finance rate, that are provided by the lease company. You may lower your monthly payment by making a larger first payment if you choose. Your payment will also be subject to VAT.

At the time you sign your car lease contract, you will be required to pay your first month's payment, as well as any VAT.

Some leases may require an up-front security deposit that goes towards your first payment if the vehicle has to be ordered.

What leasing options are there?

There are two main types of car leasing referred to as Business Contract Hire (BCH) and Personal Contract Hire (PCH) Personal Contract Hire is always displayed including VAT, as opposed to Business Contract Hire which is always displayed without VAT. Business users still have to pay VAT, but some can reclaim part or all of the VAT. This kind of long-term rental plan gives you an opportunity to drive the model you want without ever actually owning it.

In summary, what are the pros of leasing?

• Lower monthly payments compared with buying. • Minimal hassle, with the opportunity to drive away without thinking about reselling or warranties. • You are always driving around in the latest model vehicle.

What are the cons of leasing?

• You won’t be able to buy the car once your plan ends. • Comprehensive car insurance isn’t covered by your contract, so you’ll need to arrange this separately. • A rough mileage estimate will need to be agreed at the start, and you may have to pay extra if you surpass this limit. • If you want to own the car at the end, car finance deals are the more affordable path to take. As with private car leasing, you’ll be required to make a number of monthly payments over a pre-agreed period, but with a finance deal you’ll have the chance to buy the car outright once your full term is complete.


For anyone thinking about leasing a car, it's very important to understand what leasing is — and what it is not — and how it works and if you have any questions no matter how small just give us a call.