Types of Car lease Agreements

For business users, whether you are a Sole Trader, Partnership, a Limited Company or a PLC, we can offer you contract hire and leasing or various purchase plans. We also have a selection of personal finance options that are designed for our personal users.

To find out more information on the various finance options CarLease UK can provide, please read the following car leasing guide:

Contract Hire

Contract Hire is, in effect, a long term rental agreement and is the most common type of lease available in the UK (also referred to as an operating lease). It will benefit a customer who is seeking to remove assets from a balance sheet, eliminate the financial risk associated with disposing of the vehicle and, should the customer elect, enjoy the convenience of a full maintenance service, at a fixed monthly cost.

Key features and benefits include

• Fixed rentals for the whole package, making budget planning easier i.e. certainty of cost/fixed cost motoring
• Flexible terms to meet your requirements with variable duration and mileage terms
• Maintenance of vehicles can be included in monthly rentals, and so business contract hire can spread the cost
• Contract hire removes depreciating assets from the balance sheet and the associated risks of owning vehicles
• Flexible invoice arrangements help to considerably reduce administration

Personal Contract Hire

This finance option will benefit a personal individual who is seeking to eliminate the financial risk associated with disposing of the vehicle and enjoy the convenience of a full maintenance service, if requested, at a fixed monthly cost. It also enables individuals to benefit from CarLease UK’s fleet discounts, which would otherwise be unavailable to the public, an important factor within this car leasing guide.

Key features and benefits include

• Fixed rentals for the whole package, making budget planning easier
• Flexible terms to meet your requirements with variable duration and mileage terms
• Maintenance of vehicles can be included in monthly rentals, i.e. certainty of cost/fixed cost motoring

Contract Purchase

Structurally similar to Contract Hire, Contract Purchase enables the customer to make fixed monthly payments. However, with Contract Purchase the customer has the option of retaining the vehicle at the end of the contract.

Key features and benefits include

• Similar benefits to contract hire regarding fixed payments and flexible terms
• Maintenance and added value services can be included
• The finance company guarantees the resale value of the vehicle at the end of the contract purchase agreement for a known, fixed amount
• Ownership passes to the customer at the end of the agreement when all payments have been made.

Personal Contract Purchase

Again, structurally similar to Personal Contract Hire, Personal Contract Purchase enables the customer to make fixed monthly payments. However, with Personal Contract Purchase the customer has the option of retaining the vehicle at the end of the contract.

Key features and benefits include

• Similar benefits to Personal Contract Hire regarding fixed payments and flexible terms
• Maintenance and added value services can be included i.e. certainty of cost/fixed cost motoring
• The option to retain the vehicle at the end of the contract, without depreciation risks

Finance Lease

Finance Lease is a popular funding option for commercial vehicles where Contract Hire is not suitable. (Cars can be financed as well)

Key features and benefits include

• Fixed, low monthly payments and flexible terms
• Monthly rentals can be lowered further thought the introduction of a balloon rental at the end of the contract
• Although you will not own the vehicle, you would receive 98% of the sale proceeds. Where a balloon has been introduced, these proceeds are utilised to help clear the rental