Leasing Hub
If you're new to leasing & want to learn about the process, Leasing Options' comprehensive guide has everything you need to know about first-time car leasing
- Guide to car leasing
- What does it mean to lease a car?
- How does car leasing work?
- How does car leasing differ from buying a car?
- Six-step car leasing process
- What's included in a car lease?
- Car lease eligibility and finance
- What do I need to lease a car?
- Is it better to lease or buy a car?
- Leasing vs financing
- Six key benefits of car leasing
- Car lease maintenance and insurance
- End of a lease and renewals
- Six tips for first-time car leasing
- Leasing frequently asked questions
What does it mean to lease a car?
If you're wondering 'what is car leasing?', essentially it means you 'rent' a brand-new vehicle, making fixed monthly payments for a set period with an agreed mileage. Then, when your contract ends, you return the car.
Leasing a car is an incredibly popular choice for people looking for a new car as it's a cost-effective way of driving a new vehicle every few years. With no large deposit required and fixed monthly payments, it's an affordable alternative to purchasing on finance or buying a car.
How does car leasing work?
In essence, leasing means you can use a specific vehicle for a fixed period for an agreed sum of money, which is paid back in monthly instalments.
To answer the common question “what is leasing”, it's an agreement where you can use a specific vehicle for a fixed period. This involves an agreed sum of money which is then paid back in monthly instalments.
Car leasing is a similar concept to renting a car, however, instead of using it for a few days, you agree to a term typically between two and four years. When applying for a car leasing agreement, your credit score will be considered to ensure affordability and eligibility checks are met such as ensuring you're over 18. However, leasing a car with lower credit rankings is still possible.
There's also no need to worry about increasing costs or interest hikes. Monthly payments are fixed, and once the contract is up, you hand the keys back to the finance company.
Cost of leasing a car
Leasing a car is an affordable way to drive the latest models. Upon starting the agreement, an initial payment is made, which is a choice between one and 12 months instalments. This isn’t a deposit. Instead, the first payment is deducted from the total contract agreement cost.
The more you pay, the less your remaining monthly instalments will be – making it super flexible depending on your budget. The remaining instalments are paid over the rest of the agreed term.
Find out more in our guide to the cost of leasing a car
How does car leasing differ from buying a car?
There are a few key differences between leasing and buying cars and it's important that you're aware of them so that you can pick the correct one for you.
When it comes to leasing, you don't need to pay a large upfront cost, whereas when buying a car outright you do. Payment for leased vehicles is also spread out over long periods of time, but unlike with buying a car, you won't have ownership.
When leasing, you won't have to worry about the value of the car depreciating over time as once your lease ends the car is returned. This also means that you have the option to change your car more regularly and that you aren't stuck with the same one for long periods of time. When buying a car, however, you need to consider that the vehicle's value will depreciate. This means that when it comes to selling, you won't be able to receive the same price you paid.
Leased cars can also have mileage limits applied too, which isn't the case for when purchasing a car outright. If you're interested in learning more about how car leasing differs from buying a car, have a read of our guide on whether you should lease or buy a car.
Six-step car leasing process
Leasing Options has six simple steps to make it easy for our customers to lease a car.
Find your perfect car
The leasing process starts with browsing our website to find your ideal car. There's a host of top vehicle brands and models to choose from. Plus, you can filter by:
- Budget
- Manufacturer
- Model
- Body type
- Special offers
- Detailed search, such as fuel type
- In-stock vehicles
You'll get a full list of cars to choose from, and we have a dedicated team that ensures you get the best possible price. If you're still struggling, you should have a look at using our car matching tool that can find one that's best suited to you!
Car Lease Special Offers
Check out our car leasing specials for top value on a wide range of vehicles. Don't wait, our handpicked offers won't last. Find your dream car at the lowest price today.
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What's included in a car lease?
In addition to driving a brand-new vehicle, your car lease has a range of extras included within the monthly cost. This includes:
- Free delivery to your door (UK mainland addresses)
- Road tax - worth up to £3,000
- Registration fee - worth up to £55
- UK manufacturer's warranty
- 12-month breakdown assistance
- Part exchange options
Eligible for personal leasing finance?
If you're thinking about contract or personal car leasing, it's important to check your eligibility for personal leasing finance. Our tool can determine if you're eligible before the finance company performs a credit check on you.
Check your eligibilityCar lease eligibility and finance
When you choose to lease a car, there are several eligibility and financial checks carried out to ensure you can meet the monthly instalments.
A credit check is performed by the finance company, which determines the outcome based on several factors. If you're unsure what your credit score is, for example, credit reference bureaus such as Experian provide this information.Higher credit scores are more favourable when applying for a car lease. However, isn't impossible. You can use an eligibility checker to determine whether a lease deal suits your circumstances.If you're part of a corporation looking to lease a vehicle, you may be interested in looking at our business car leasing deals instead.At Leasing Options, we work with several finance companies to bring customers the best possible deals on finance for a new lease car. So, chat with the team for more information.If you want to know more, check out our guide to car leasing eligibility.What do I need to lease a car?
You'll need a few things to hand when you start the car leasing process. These form part of your eligibility and financial checks.
What you need to lease a car:
Necessary documents
- Up-to-date photographic identification – driving licence or passport
- Proof of home address – bank statement, utility bill or credit card bill (must be dated within the last 90 days)
Additional documents
- Employment history details (previous three years)
- Proof of current monthly income (payslip)
- Details of other significant monthly expenditure
- Marital status
- Address history (last three years)
- Bank details (for monthly payments)
In Stock Car Lease Deals Available Now
Leasing Options understands waiting for a new car isn't always possible. Maybe your lease is ending or your car is old, or you like new models. Regardless, we offer in-stock car leases to meet your needs, which could be delivery within as little week.
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Over250in stock deals
How does car leasing compare to other finance options?
Weighing up the pros and cons of leasing a car vs buying one is always a good idea when searching for your next vehicle. Each has its benefits and drawbacks, including the comparison between leasing, PCP and other car finance options.
Comparing each can help you make the best choice for your circumstances and lifestyle. Leasing contracts differ from financing a vehicle using PCP, HP or bank loans. Some of the main differences include the following:
- PCP includes a larger balloon payment at the end
- PCP and HP require a deposit
- HP doesn't have mileage caps or excesses for wear and tear
- HP and bank loan funding means you own the vehicle outright
Find out more in our guide to the differences between PCP and leasing.
So, take a look at what's included in each common leasing and buying option below:
| Leasing vs finance | ||||
| Things to consider: | Leasing | PCP | HP | Bank Loan |
| Deposit required | ||||
| Fixed monthly payments | ||||
| Mileage cap | ||||
| Fines for excess wear and tear | ||||
| Depreciation risk | ||||
| Own the car at end of term | ||||
| Balloon payment at the end | ||||
| Early redemption charges | ||||
| Secured against an asset | ||||
Leasing vs financing
Leasing contracts differ from financing a vehicle using PCP, HP or bank loans. Some of the main differences include the following:
- PCP includes a larger balloon payment at the end
- PCP and HP require a deposit
- HP doesn't have mileage caps or excesses for wear and tear
- HP and bank loan funding means you own the vehicle outright
Find out more in our guide to the differences between PCP and leasing
Six key benefits of car leasing
Considering a new car lease? Check out six benefits that make this option a great choice.
Find out why leasing could be right for you in our guide to leasing benefits and considerations.
Car Lease Special Offers
Check out our car leasing specials for top value on a wide range of vehicles. Don't wait, our handpicked offers won't last. Find your dream car at the lowest price today.
View latest special offersCar lease maintenance and insurance
Leasing with insurance or a maintenance package can save you time, money and hassle whilst giving you fixed cost motoring all in one place.
Lease a car with maintenance
Adding a maintenance package to your lease contract is a cost-effective way to keep your vehicle in the best working order. Typically, when you lease a car, this cost is down to the leaseholder.
However, at Leasing Options, a leasing maintenance package can be added to cover these costs. In a car leasing service and maintenance package, you get:
- Servicing – according to the manufacturer's requirements
- MOTs
- Tyres
- Oil checks and top-ups
- Brake pad checks and replacements
- Breakdown recovery service
- Free pickup and delivery to service centres if required
Your finance company's 24-hour assistance team is always here for you – meaning you'll be covered for breakdowns, punctures, services and replacement tyres around the clock. And that's not all. Depending on the approved service centre used, a courtesy car can usually be provided while your vehicle is off the road.
Car lease with insurance
Getting insurance for your newly leased vehicle is similar to any other car. However, our insured leasing package, Fuel & Go, makes covering your new wheels super simple and affordable.
Choosing a car lease with insurance included takes the hassle out of additional paperwork and covers you for the length of the agreement. What's more, the Fuel & Go package with Leasing Options means exactly that – just add fuel and drive.
This comprehensive insured car leasing option covers not only insurance but also breakdown cover, maintenance and accident management for one fixed cost.
The policy protects you while you enjoy your new leased vehicle and covers everything from:
- Third-party liability
- Cover for family/spouse use
- Glass protection
- Replacement vehicle
- Recovery service
- Courtesy car
- Theft
- Accidental damage
- Vandalism damage
Find out more in our comprehensive guide to car lease insurance.
Lease car insurance costs
Like all insurance policies, the cost of an insured lease car varies depending on the model and driver insurance history. In addition, drivers and any additional drivers must meet the Fuel & Go driver eligibility criteria.
End of a lease and renewals
Unlike other finance agreements, leasing contracts require an individual to return the vehicle to the leasing company. At this point, you can choose a renewal lease (picking your next car) or the end of the contract.
In most circumstances, returning the lease car is standard procedure, as you don't own it at the end of the agreement.
However, there may be an option of buying a car at the end of the lease (otherwise known as a lease purchase). To explore this option, chat with your account manager.
If you want to know more, head over to our end-of-lease and renewals guide.
What's the process – what happens at the end of a lease?
Whether opting for a lease renewal or ending the contract, the car is returned to the finance company.
It's collected free of charge and inspected according to the Fair Wear and Tear Policy. The driver is responsible for ensuring the vehicle is returned in a legal, roadworthy condition.
It should be free from any internal or external damage, apart from fair wear and tear, which will be fully explained before signing your contract. You'll have to pay if any damage has been caused by negligent behaviour, poor treatment or an accident.
Mileage allowances are also checked. There will be a fee if you exceed your mileage limit, which is agreed to at the beginning of the contract. However, this could be as little as 5p per extra mile, so it isn't as much as you think. Excess mileage charges are explained when you place your order, so there won't be any nasty surprises!
Need to sell your car?
The process couldn't be simpler. With Motorway 5,000+ dealers compete to give you their best price! And you can sell your car in as little as 24 hours. Enter your number plate and mileage for a quick car valuation today.
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Six tips for first-time car leasing
Leasing a car for the first time? Check out our handy tips to make the process easy.
Find your perfect vehicle now
Use our car matching tool to find a flexible solution to meet your leasing budget. Click more options to narrow down the search results.
Leasing frequently asked questions
Below, you'll find some of the most common leasing FAQs. If you can't find the answer to your question, please contact us to discuss your car lease.
Can I trade in my existing car?
Yes, in most cases, leasing companies will allow you to trade in your existing vehicle in part exchange for your leased car.
For example, Leasing Options has a simple process for a part exchange. All you need is your registration and contact details for an instant valuation.
Do I own the car at the end of the lease?
In most cases, no. At the end of the leasing contract, the car is returned to the finance company. However, some leases may have the option to buy (also known as a lease purchase). Contact your account manager for more information on this option.
Will my leased car need an MOT?
Brand-new cars require an MOT after three years. So, if you have a term length of over three years, your vehicle will need an MOT.
Is my leased car covered by the manufacturer's warranty?
Yes, all leased cars are covered by a manufacturer's warranty.
Are there any charges at the end of my contract?
Charges may occur at the end of a lease agreement due to exceeding mileage allowances and damage over the fair wear and tear policy.
How are leasing payments calculated?
At the start of your car lease deal, an initial payment is required. This is typically between one and 12 months of monthly instalments. The amount is taken off the total lease costs, and the remaining is divided equally over the term.
The car's depreciation determines the monthly sum you'll pay during your contract. This is worked out by calculating the miles you'll do and the car's age when you return it.
Who will be the registered owner and keeper?
The registered owner of a leased car is the finance company. Find out more in our guide to a lease car's registered keeper.
What is fair wear and tear?
Fair wear and tear is considered deterioration that occurs under normal usage. This is highlighted in the Fair Wear and Tear policy as set out at the beginning of your leasing agreement. Anything outside this is typically charged according to the severity of the damage.
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