What are Short Term Car Leases?

Credit: Pixabay.com

Short Term Car Lease Pro’s

  1. Approx. 70% cheaper than using Daily Rental over the same period.
  2. Change you car more often than you change your smartphone!
  3. Ideal for new start employees, fixed term employees and projects.
  4. Flexible, especially the flexible car lease options.
  5. 3, 6, 7, 9 and 2 month contract on the fixed options
  6. No long term commitments
  7. Can be available for non-status car lease customers
  8. Can be used for Expat Car Leasing
  9. Drive the car you choose, not a group

Short Term Car Lease Con’s

  1. Costs are generally higher than traditional contract hire & leasing
  2. Insurance can be higher if you’re not savvy, take a 12 month policy and cancel early to save money!
  3. Return standards are much higher for a short term car lease, they are not covered by the BVRLA fair wear and tear guide.
  4. Excess mileage costs are higher due to the residual values on a new car financed over a shorter period.
  5. Deposits or initial rentals can be higher for those on non-status terms or customers with adverse credit.
  6. You can’t order a car of your choice, the options tend to be already available and in-stock ready to be delivered.
  7. Damage to the vehicle needs to be repaired under a manufacturer approved bodyshop, don’t take it to a side street otherwise you will get a bill to rectify the work.
  8. Tyres always need to be replaced like for like, so don’t swap them for budgets or you will get a nasty surprise to replace them.
  9. Don’t pay they’ll take it away — As short term car leases don’t all fall under FCA rules, if you don’t pay you could see your car being repossessed within days and the recovery costs passed on.
Credit: Pixabay.com

Is Short Term Car Leasing for me?

Thats for you to answer, but if you are the type of person to want to drive a new car every time a new plate comes out, a short term car lease could be for you. For those who like to drive a convertible in the summer and an SUV/4x4 in the winter months, then its ideal.

Comparing Short Term Car Leases vs. Long Term Contract Hire

It can be pretty easy to compare prices when looking at the 2 options, as with all contract you need to look at the bigger picture. Most contract hire & leases require a high initial payment, these can be in multiples of 6 or 9 equivalent monthly payments, which means the initial outlay can be quite high.

Here are a few current examples (Correct as of 8th May 2019)

36 Month Contract Hire
BMW X3 20d M Sport 5dr Auto
Initial Rental: £3641.13 plus VAT
Processing Fee: £180.00 plus VAT
35 Payments of £404.57 plus VAT
15k per annum / Non-maintained
Overall Cost over the 36 months: £17981.08 + VAT

Another example…

24 Month Contract Hire
BMW 116d SE Business 5dr Manual
Initial Rental: £3529.44 plus VAT
Processing Fee: £180.00 plus VAT
23 Payments of £392.16 plus VAT
12k per annum / Non-maintained
Overall cost over the 24 months: £12729.12 plus VAT

Short Term Car Leases in a Nutshell

The examples above are taken in a snapshot of time, and these do change every day. We’ve had quite a few examples over the years where the short term product is cheaper than the long term, but it only really works when there is a vehicle or manufacturer with a strong residual value.

How do suppliers work out the cost of a short term car lease?

This is a pretty easy equation:

Any questions on short term car leases?

If you have any questions on short term car leases or have had them before in the past and you believe I’ve missed anything, then drop me a line below and I will come back to you.

About me and my short term car lease business…

I have been running my own short term car lease business since 2007, having come from a dealership background. I like to be upfront about the services we offer and the pro’s and con’s of a contract. Also I’m not a sales person, so I’m determined to recommend products and services based on the customer and not the profit.

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Rhys Adams

Rhys Adams

I live in a beautiful town called Belper on the edge of the Peak District with my wife Rebecca. I enjoy writing, photography and gadgets.