How Much Does It Cost To Lease A Car?
Need to know how much does it cost to lease a car but can't find anyone giving you a straight answer? See our complete guide explaining how lease costs are calculatedSo, the buzz words over the last few years around new cars has been "leasing". I guess the first question most potential leasing customers ask themselves is "how much does it cost to lease a car?" And that is a great question, but one that nobody seems to want to answer - so let me give it a go for you! [caption id="attachment_509" align="aligncenter" width="500"] Finding out how much a lease car costs can be hard work![/caption] The problem with the question "how much does it cost to lease a car?" is that there are so many factors involved when leasing a car that prices will vary massively. Having said that, let me talk you through these factors so you get an idea how we get to the monthly rental. Price Of The Car As you would expect the on the road price of the car has a massive impact on the monthly rental. Typically the more expensive the car, the higher the monthly lease rental. Length Of Contract A common way to keep the monthly rental as low as possible is to increase the length of contract. The longest period you can lease a car or van over is normally four years. A four year lease would usually ensure the monthly rentals are kept to a minimum. However, there are certain instances when the finance company will offer a cheaper rate on a two year contract. This is because a two year old vehicle will be sold back into the manufacturers used car centers where a higher resale value can be reached than if it went to the auctions. Deposit/Initial Rental Again it sounds obvious but the greater the deposit/initial rental you can afford to put down the lower the monthly rental will be on your lease car. The total amount you pay over the length of the lease period is roughly the same. So it really just depends if would rather put more down up front and pay less each month or lower upfront and higher each month. Mileage The higher the annual mileage the lease agreement is set on, the higher the monthly rental will cost. This is because as you pile the mileage onto your vehicle, the resale value is decreasing at a rapid rate. So the finance companies will factor this into the monthly rental. Don't think about setting the annual mileage lower than you will actually do, there are excess mileage charges at the end of the contract if you go over the total agreed contract mileage. These excess mileage charges range depending on the vehicle, but typically are between 6 - 10 pence per mile! Resale/Residual Value The resale value, or residual value as its more commonly called, is the amount the finance company expect the car or van to be worth at the end of the contract. The higher the residual value the lower the monthly rentals will be. This is why you will find that an Audi A6 can be cheaper to lease than a lower value car, say a Ford Mondeo. I hope this has gone some way to help you understand "how much does it cost to lease a car?" and how the monthly figures are calculated. If you have any questions or just want some straight talking advice please feel free to call our team on 0151 728 4711 or visit Stable Vehicle Contracts. If you are considering changing your lease car or van in the near future why not join the thousands of subscribers who already receive our weekly newsletter. Each week we aim to send out a selection of the very best contract hire & leasing offers in the UK!