Looking for a new van? Have you considered Contract Hire?
Looking for a new van can be an exciting, nervous and potentially stressful time as you mull over all of the possible new vans and van finance options. At Car & Van Finance Direct we are here to help, here we take a closer look at van contract hire as a way of financing your new van!
Van Contract Hire
If owning the van at the end of the term is not of great importance to you, then you may want to consider van contract hire. Contract hire is the most popular form of vehicle leasing in today’s market and is a similar option to van finance lease, in that you can have the use of a van for a fixed monthly cost over a pre agreed period of time ranging from 2 years up to 5 years. However unlike finance lease there is no final balloon payment at the end of the contract and you are hence not required to sell the van, you simply just hand it back.
With van contract hire you pay an excess mileage charge for every mile you have travelled over the mileage figure agreed at the start of your contract, you are also charged for any damages which don’t constitute as fair wear and tear of the van through the lifespan of the contract.
Van Contract Hire benefits
Van contract hire tend to offer lower monthly payments in comparison with other types of van finance and is particularly handy for businesses who want to keep outgoings at a minimum. Only a small deposit is required for van contract hire, the minimum being three monthly rentals, however this can be adjusted so that monthly payments are reduced.
As mentioned previously there are no balloon payments at the end of the contract hire agreement, so you simply hand the van back and are free to source a new vehicle with no other worries. Van contract hire also means you’ll drive a new van all of the time, you’ll never drive a van which is older than the contact hire term, meaning all of the latest technology, whilst also projecting a professional and reliable image for your business.
Van Contract Hire considerations
You can opt for a maintenance pack and as the name suggests this will take care of all regular maintenance, meaning your van is kept in the best possible condition and in turn minimises van downtime. Road fund licence, tyres, servicing, brakes and warranty repairs are all covered with contract hire maintained agreements.
If you are in a trade where the van tends to be knocked around such as builders, then van contract hire may not be advised as it is likely that the condition of the van at the end of the contract will be worse than the fair wear and tear guidelines and hence you’ll end up having to pay out for any repair costs.
As you hand the van back at the end of the agreement, contract hire agreements tend to be cheaper than van hire purchase agreements.
New vans on contract hire