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How does van leasing work?

By Stephen Turvil | November 14, 2022

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How van leasing works. Simply pick a van, decide how long to keep it, estimate your annual mileage, and optimise the terms of the lease to suit your needs.

How does van leasing work?

Leasing is the flexible way to pay for a van as you can fine-tune the terms to suit your circumstances.

How to lease a van: pick a model

Start by choosing a suitable vehicle. The considerations include its make, model, maximum payload, towing capacity, fuel type, gearbox, reliability record, running costs, body style, and trim level. You can either lease the vehicle directly from its manufacture, or from a company that supplies vans from many brands.

How to lease a van: pick a term

Decide how long you want to keep the van. The typical options include 24, 36, or 48 months.

How to lease a van: estimate mileage

Estimate how far you will drive your vehicle. Try not to overestimate this figure as this will unnecessarily increase the cost of your lease.

How to lease a van: add optional extras

If needed, add optional extras such as a specific colour or metallic paintwork. A vehicle maintenance plan may be available, too. The plan could cover the cost of servicing the van and replacing worn tyres. If the van is not serviced at the intervals recommended by the manufacturer, its warranty could be invalidated.

How to lease a van: fine-tune the payments

The supplier now calculates the cost of leasing the van based on your choices. An initial payment comes first. This is followed by monthly instalments. There might be an arrangement fee, too. If helpful, you can adjust these payments to suit your needs. For instance, you might reduce the initial payment in exchange for higher monthly instalments. See the table below for example terms.

Example van leasing terms. 

Vehicle Large Van
Length of lease  48 months
Annual mileage  8,000 miles
Optional extras Maintenance plan
Initial payment £3,551.85 (equivalent to nine monthly payments)
Monthly payment  £394.65 (including the optional maintenance plan)
Arrangement fee  £294

What happens at the end of a van lease?

At the end of the lease, the van has to be returned to its supplier in good condition. You cannot opt to buy it. Although fair wear is accepted, the supplier will issue penalty charges if your vehicle has exceeded its mileage allowance, it comes back with any damage or has been modified without approval. 

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