What can I use my contract hire car for?

15/07/2021

What can I use my contract hire car for?

If you have never leased a vehicle previously, you may be wondering, ‘What can I use my contract hire car for?’

Essentially, you can use a leased vehicle for just about any purpose but there are some restrictions.

The bottom line is that you will not own the car and you need to be aware of the wear and tear issues.

This means that the car leasing company will appreciate that your vehicle will pick up some wear and tear while being used, but serious damage will need to be paid for.

What is car leasing?

If you are new to leasing a car, which is also known as contract hire, then this is an effective way to drive a brand-new vehicle rather than buying it.

You will be paying a fixed monthly payment and a leasing contract will usually run for between two and five years.

It's very much like renting a home because you don't own the vehicle and you simply return it when your leasing agreement ends.

The advantages of car leasing include:

  • You can choose the make and model of the car you want
  • It can be cheaper than buying a car outright
  • You do not need to invest a large amount of money to buy
  • You can get to enjoy the latest cars with the best specifications.

Essentially, when it comes to car leasing, you will be paying for the depreciation of that vehicle over the agreement's terms.

How much does it cost to lease a car?

A lot depends on the make and model of the car you want to lease as this will dictate the cost.

Also, you need to know what your annual mileage will be because this will affect the monthly payment.

And, if you go over this agreed limit, you will be liable for excess mileage charges because the car will be worth less with a higher mileage than was agreed.

You also need to be aware of administration fees and the initial payment which can be just one month of your agreed fee or more to help reduce the monthly payment.

How do I lease a car?

The best way to lease a car in the UK is to work with a reputable car leasing company such as Tilsun Leasing.

That's because they are authorised and regulated by the Financial Conduct Authority (FCA) and offer personal lease and business lease deals.

The monthly rental fee will be agreed beforehand, and a credit check will be carried out to ensure that you can pay this amount.

The contract hire agreement will detail this amount, how many months you need to pay and what the agreed mileage is - plus the excess mileage charge.

Delivery is free to a mainland UK address and the Tilsun Leasing team can also explain more about personal contract hire deals and business contract hire rates.

It's also possible to arrange for maintenance packages which will bring peace of mind to ensure that your lease car is serviced and maintained properly for a set fee.

Some things you cannot use a leased car for

Here is a quick rundown on some of the things you cannot use a leased car for:

  • Secure a personal loan: While you can use a car as collateral to secure a personal loan, a leased car does not belong to you so it's not an asset you own and cannot be used as collateral
  • Use a leased car as a taxi: It's best to find a firm that specialises in leasing taxis because of the wear and tear the vehicle will endure.
  • Using a leased car for Uber driving: As with using a lease car as a taxi, you cannot use a leased car for hire or reward
  • Can I trade in a leased car?: You cannot trade in a leased car to get another vehicle or to pay off a loan. Again, since the finance company will own the car, you don't have the right, or the documentation, for trading a leased car in
  • Can someone else drive a car I lease? You can have someone drive your lease car, but you need to give them permission and they need to have their own comprehensive insurance.

There are some things that you will need permission from the leasing company for, such as vehicle wrapping may be necessary for a business car lease, along with privacy glass and remapping the engine for better performance.

It's also worth getting permission before installing a tracker, as well as custom alloy wheels and a towbar.

If you want to fit a dashcam then ensure it doesn't leave any marks or cause damage - and you will need permission if the dashboard camera needs to be hardwired into the car.

Car leasing deals

If you want to access the best car leasing deals and find out more about what you can use a contract hire car for, then it's time to speak with the Tilsun Leasing team on 03330 040 888.

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