What is Leasing?

Contract hire, or leasing, is a long-term rental agreement offering the exclusive use of a vehicle for a set period of time, and at a fixed monthly price which is determined by the expected mileage of the vehicle and the period of hire. It offers an alternative, and often cheaper, funding solution to buying a new vehicle with a bank loan or dealer finance. Leasing quotes can be tailored to the exact needs of the customer meaning you can keep to a set budget in terms of spend, annual mileage and contract length. 

At the start of a contract an initial rental is paid, and the customer then makes regular monthly payments for the duration of the contract term. At the end of the contract (typically two, three or four years), the customer simply hands the car back without any further obligations. 

Leasing helps you avoid any unexpected costs by offering a fixed monthly payment for the term of the lease. You also don’t have to worry about or selling the car or the depreciation, as this falls to the leasing company.

Your monthly payments are based on a fixed annual mileage agreed at the beginning of the contract, so it is always best to estimate mileage as accurately as possible. If you do exceed the agreed allowance, at the end of your contract you will be billed an excess mileage charge at a pence per mile rate as detailed in your hire agreement.

 

Advantages of Leasing

  • Flexible initial payments as low as 1 monthly rental, so you may not need to find a large deposit
  • Fixed cost motoring. Simply hand the car back at the end of the contract.
  • Road tax is included.
  • Optional maintenance packages allowing budgeting of servicing, maintenance and tyres on a monthly basis.
  • No depreciation or disposal risk.

 

Disadvantages of Leasing

 You must consider whether your circumstances are likely to change and whether the contract is affordable now and during the contract, as early termination can be expensive.

  • You will never own the car.
  • Excess mileage charges are payable should the car exceed the contract mileage.
  • Wear and Tear is still the responsibility of the lessee, just the same as if you were the owner. Please see our Fair Wear and Tear section for more information.
  • It may be difficult to lease a vehicle if you have a low credit rating.

What is included in my contract?

All of our lease contracts include the following:

  • Free UK mainland delivery*
  • Full manufacturer’s warranty
  • Road tax

*For some locations a delivery charge will be made, depending on address and vehicle manufacturer

What isn’t included in my contract?

  • Vehicle insurance,you will need to arrange fully comprehensive insurance for the duration of the contract.
  • Maintenance & Servicing. This isn’t routinely included in a leasing deal, though optional maintenance packages can be purchased. If you wish to discuss this with one of our consultants, please contact us.

 

Why Choose iCarLease?

 If you choose us, our dedicated team of consultants will make sure your transition to iCarLease is as smooth as possible and we will work with you every step of the way from initial quotation right through to delivery of your new vehicle. 

For more information about the services we provide please contact us and one of our dedicated consultants will be happy to assist you.

 

Fair Wear and Tear

At iCarLease, we understand that wear and tear costs can cause confusion and unwanted surprises, so we comply with the British Vehicle Rental and Leasing Association Fair Wear and Tear Policy. It is important that the vehicle is returned in accordance with the guidelines set out in the 'Fair Wear and Tear Guide'.

 

To view our Car Fair Wear and Tear Guide, please click here.

To view our Van Fair Wear and Tear Guide, please click here.

 

Frequently Asked Questions

 

Will Road Fund Licence be Included with my Contract?

Yes – your leasing agreement will include Road Fund Licence (otherwise known as vehicle tax) for the duration of the contract or 12 months. The length of time tax is covered will depend on the type of contract taken.

From October 2014, paper tax discs are no longer being issued. Vehicles will still need to be taxed, but physical tax discs will no longer be sent out to you and there will be no need to display a tax disc in the vehicle’s windscreen.

Is Breakdown Assistance Included with my Contract?

Yes – all contracts for all vehicles include breakdown recovery, the length and provider of which will vary depending on the manufacturer.

Is Maintenance Included with my Contract?

Maintenance is an optional cost and includes servicing, necessary maintenance of tyres, brakes, the exhaust and the battery of your vehicle. Including maintenance in your contract can give you peace of mind and provide a fixed cost for the duration of the lease, so you won’t have any unexpected expense.

Do I need to Insure my Lease Vehicle?

For personal leases, the lessee is responsible for arranging fully comprehensive insurance on the vehicle for the life of the contract and they must be the main policy holder.

For business leases, the insurance certificate should be in the company name or a director's name. Where an employee is required to drive the vehicle, a letter on company headed paper may be requested confirming the employee’s position within the company and that they are authorised to drive to vehicle.

What Happens if my Lease Vehicle is Involved in an Accident or Written-Off?

If a lease vehicle has been declared a ‘total loss’ – i.e. written off or stolen – we need to be made aware as soon as possible. Your finance provider will require written confirmation from your insurance company that the vehicle is a total loss before providing an amount for settlement of the vehicle contract.

It’s worth noting that your finance provider will not enter negotiations with your insurance company, you will need to do this. Also, you should be aware that the insurance value of the vehicle may not always cover the value which is outstanding on the lease.

In the event of a total loss, our consultants will be able to give you all the information and instruction you need, so please contact us.

What is an Initial Rental?

The initial rental is payment usually equivalent to 3, 6 or 9 monthly rentals and is payable to finance company within 7 to 14 days of the vehicle’s delivery. This rental payment is part of the hire agreement and is therefore non-refundable. Having a larger initial rental payment can reduce your monthly payments, so it may be worth looking at different payment options to see what works best for you.

When will Rental Payments be Taken?

Rental payments will be taken by direct debit and so the date will be dependent on which finance company is funding your vehicle. Initial rental payment are usually taken within 14 days of delivery of the vehicle, but some funders take payment before delivery is booked.

Monthly payments are usually taken a month after vehicle delivery, with the date set by the finance company.

Who will Supply my Vehicle?

All vehicles arranged through iCarLease are supplied through a manufacturer franchised, nationwide dealer network. We have excellent relationships with our approved dealer network, enabling us to provide an efficient, reliable service.

Will my Vehicle come with any Warranty?

Yes, all our vehicles come with the full UK manufacturer’s warranty, the length of which will depend on the manufacturer. To discuss the details of any warranty which comes with your vehicle, please contact us.

What Mileage Should I Choose?

Mileage is one of the main elements in calculating how much a lease will cost. If you exceed the quoted mileage, you will be required to pay an excess mileage charge to the finance company at the end of lease, so it is always best to give an accurate figure when looking at a leasing deal.

Will my Credit History be Checked?

Yes. As part of the leasing application process, you will be need to complete a finance application, either as a business or personal customer.

Most funders ask for a good to excellent credit score in order to be accepted for vehicle finance, though no lender will use credit score alone to approve or decline finance. Affordability is a big factor in them deciding whether or not you can meet the monthly payments regularly and on a timely basis. 

Will Delivery and Collection of my Vehicle be Included?

UK mainland delivery is usually included with any vehicle leased through iCarLease, though some manufacturers may charge additional fees, especially for more remote locations. To discuss any potential delivery charges on your vehicle, please contact us.

At the end of the agreement, the finance company will usually collect the vehicle for free, provided that enough notice is given to them to arrange the collection. The vehicle must remain fully comprehensively insured until it is collected.

Who will be the Registered Owner and Keeper of the Vehicle?

For all leases provided by iCarLease, the finance provider will be the registered owner and keeper of the vehicle and will hold the V5C registration document (log book) for the duration of the contract.

Can I Change the Detail of my Contract?

Any changes to a contract would be at the discretion of the finance company. They will be aware that changes to personal circumstances can happen at any time, so it’s best to discuss your needs with them to see what options are available to you. Please be aware that any changes to a contract may incur an admin fee.

What Happens if I Exceed the Agreed Mileage on my Contract?

Any mileage driven which is over the amount stated in your hire agreement will incur a charge from the finance company, charged on a pence per mile basis. It is therefore always best to accurately estimate the mileage you will drive over the life of the contract.

As an example, if the excess mileage rate stated in your hire agreement is 10p per mile, and you exceeded your mileage allowance by 1,000 miles, you would be charged £100.

Can I Terminate my Agreement Before it is due to end?

Early termination is always at the discretion of the finance company and will incur a charge, so you should contact them to discuss your options.

Who will own the Vehicle at the end of the Agreement?

With contact hire and leasing, it is not possible for you to own the vehicle, so for all contracts provided by iCarLease, the vehicle will always be owned by, and returned to, the finance company at the end of the agreement.

What Level of Wear and Tear is Acceptable?

The condition of the vehicle upon its return is your responsibility, just the same as if you owned the vehicle. For further information, please see our Fair Wear and Tear Guides, provided by the BVRLA (The British Vehicle Rental and Leasing Association).

To view our Car Fair Wear and Tear Guide, please click here.

To view our Van Fair Wear and Tear Guide, please click here.

Can I take my Vehicle Abroad?

Depending on the finance provider, you may be allowed to take the vehicle abroad for a specified period of time. You will need to contact the finance provider to discuss your options and, if they agree to your request, to give them sufficient time to provide the paperwork that you need.

Along with standard documentation, leased vehicle drivers will VE103B certificate. This is the only legal substitute for the V5C (log book) and only an original copy is acceptable. The VE103B contains details of the vehicle and the driver and gives permission from the finance provider for the driver to be using the car abroad.

For further information on foreign travel with your leased vehicle, please click here