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Contract Hire and Leasing Explained

Blue Chilli Cars specialise in business and personal contract hire and leasing of cars and vans. We are here to help.

That's why we've put together this comprehensive guide to contract hire and leasing, answering all your questions, making it clear what the benefits of car leasing are and why we're the clear choice for you.

What is contract hire?

Car contract hire - also known as car leasing - is an affordable and manageable way to drive a new car. When you enter into a car leasing deal you take control of your chosen vehicle for a period of time - usually two, three or four years - but you don't own it.

Instead, you reach an agreement with the car leasing company to pay a deposit (typically between three and nine months payments) and then recurring monthly payments for the term of the lease.

At the end of the lease you return the car to the leasing company with nothing more to pay (subject to mileage terms).

What are the benefits of car leasing?

There are a number of benefits to choosing a business or personal car leasing deal over, for example, contract purchase or finance.

Perhaps the most important benefit is financial. Car leasing from Blue Chilli Cars offers the advantage of fixing many of your motoring costs – you know exactly what you will have to pay and when you have to pay it, helping you to budget.

Please contact Blue Chilli staff for a no obligation chat about how we can work together to provide you with a flexible deal that suits you perfectly.

If you are VAT-registered and choosing business contract hire then you can reclaim 50% of the total payments made and 100% of the maintenance package costs. Hire rental tax allowances can also be applied.

Secondly, you don't have to worry about depreciation. Any value the car loses over time is not your problem as you don't own it. At the end of the term you simply hand the keys back to the dealer.

You also avoid the hassle of selling the car when you're done with it - again, that becomes the dealer's problem when you hand the car back.

Even better, contract hire and leasing means you can be driving a brand new model every two or three of years if you like, which means you'll never have to worry about the car being out of warranty.

With some contract hire and leasing deals you can even pay extra each month for maintenance costs, so that if any problems should arise with the car, you won't have to find the money to repair it. However, new cars tend to have a warranty that lasts for the first two or three years, so it may not be cost effective to double up on maintenance costs.

Of course, manufacturers warranties don't cover everything - and that's when the professional support of staff from Blue Chilli Cars is of value. We discuss aspects such as the wear and tear on tyres and batteries as these are unlikely to be included so it is important to look at just what the maintenance payments do and don't cover.

Finally, whether you're a business or personal user, you can take advantage of the benefits provided by contract hire and leasing, as Blue Chilli Cars provides car leasing deals for both. 

Where do the cars come from?

Good question! All of our cars are supplied by a partner franchised dealer network, including Lex Autolease and Leaseplan UK, with full dealer and manufacturer back up, meaning we provide a genuine nationwide car leasing service.

This is vitally important when considering business or personal contract hire deal - and with Blue Chilli Cars you get that assurance and peace of mind.

What else do I need to know?

There are some important things to know when you're considering a car leasing deal from Blue Chilli Cars.

First of all, whether business contract hire or personal leasing, there will be an annual mileage limit. It is therefore important to choose the right deal for you, as should you exceed the mileage over the agreed term there will be more to pay at the end of the leasing deal.

Blue Chilli Cars' experienced staff can advise you on the right deal for you with regard to mileage.

Secondly, as you don't own the car when you use contract hire and leasing you will need to have fully comprehensive insurance. Third party insurance only covers damage to other people's property in the event of a claim, leaving you liable to the cost of repairs for damage to your vehicle. Handing back a damaged car at the end of the contract hire period will result in additional charges.

While you will have no problem getting comprehensive insurance on a leased vehicle premiums do tend to be slightly higher. Typically this is only £10-£15 a year, so if a leasing deal is appropriate for you this is very likely to be worth paying.

Finally, should you miss a scheduled payment or wish to end the lease before the contract term has ended you could incur further charges. Our friendly, professional staff will discuss this with you before you sign any car leasing deal.

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