Car leasing is slightly different from contract hire. It allows you to acquire a vehicle by paying a deposit followed by further agreed monthly payments. The difference is that you have the option to purchase the vehicle at the end of the lease period, at an agreed price, this is known as a balloon payment. Leasing rarely comes with any kind of maintenance attached to it, unlike contract hire. You will have to take care of the maintenance side of the vehicle yourself. Although some companies do offer this as part of the deal, most don't. If you are VW car lover and would like to drive the latest VW that is on the market, you could opt for VW car leasing. Instead of purchasing one outright, you could pay a small deposit and at the end of the term if you wanted to purchase it you could.
The advantages of car leasing
Get the latest vehicle without having to pay upfront
Monthly repayments are usually lower than that of a car loan
Drive a brand new vehicle every two to four years
You can gain access to a luxury vehicle or as stated earlier if you love your VW cars then you could get the top of the range model. If you wanted a VW with all the latest specifications, instead of going for one that is five years old, because that is all you could afford. You could go for one that is fresh out of the factory, and you if you decide to buy at the end of the lease agreement you could. You could even just exchange it for a newer model and extend the lease agreement for something that has a higher spec.
Are there any disadvantages?
Some people that opt for car leasing instead of contract hire, will say that one of the only disadvantages is that you have to take care of all the repairs yourself.
Whereas with contract hire, there is usually some kind of maintenance deal attached to the agreement. This could be seen as a major disadvantage; however there are many advantages that could outweigh the disadvantages.
Car leasing is not for everyone, but for those who want to be able to drive a brand new car without having to pay huge upfront costs; this could be the best option. If you consider the fact that if you were to purchase an old car you might have to spend a lot of money on general maintenance. However, if you opt for leasing, you could get a brand new car, although you have to take care of the repairs yourself, you may not have to repair the vehicle as often as you would do an older model vehicle.