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When you lease a vehicle you normally need to pay a initial rental, sometimes referred to as an up-front payment. This is usually expressed as a set number of Lease rentals ( typically between 3 and 12 lease rentals) and is an advance rental payment and the amount you pay will have a direct impact on your monthly lease rental.
For example - the total rental payable over a 3 year period for your chosen vehicle is £7,600 excluding VAT.
If you choose to pay a 3 month initial rental followed by 35 monthly rentals then your initial rental would be £600 (3/38th of £7,600) followed by 35 payments of £200 (£7,000).
If you choose to pay a 9 month initial rental followed by 35 monthly rentals then your initial rental would be £1,554.57 (9/44th of £7,600) followed by 35 payments of £172.73 (£6,045.55).
Under both examples the Lease rentals paid over the total contract are the same and sum up to £7,600.
Certain vehicle finance companies may require a minimum Initial lease payment and this will be confirmed at the vehicle order stage, this may be due to your personal financial circumstances/credit history or down to being a standard policy from the finance company. It should also be highlighted that as the Initial payment relates to a part payment of the total rentals payable it is not a deposit and is non-refundable.
The initial rental is payable to the finance company, the payment date is usually 7 to 14 days after you have taken delivery of your vehicle, however some finance companies may require payment prior to delivery. We will confirm payment dates when you order your vehicle.
When comparing your options for the most competitive leasing deal it is important that you factor the initial rental into your total costs, some businesses may advertise a very low monthly vehicle lease rate as they have factored in a very high initial payment. Our recommendation is that to compare deals you do a simple calculation:
Initial Rental + Admin Charge + (Monthly Rental X Number of Rentals Payable) = Total Amount Payable Over Contract
