What happens when my car lease ends?


What happens when my car lease ends?

One of the benefits of a personal contract hire deal means that when your car lease ends, you simply hand it back to the finance company.

They will send someone to collect it for free and they'll check it over for:

  • The mileage: They will check whether you have gone over your agreed limit. You will be liable to an excess mileage charge, and this will vary between car leasing companies
  • Damage to the vehicle: Car leasing companies appreciate that cars will be damaged and there are fair wear and tear guidelines - we explain more below - but you will be expected to pay for serious damage to be repaired.


Arranging the collection of a lease car

Before your agreement ends, the car leasing company will be in touch to discuss what your needs and options are and whether you want to take out a new car leasing deal.

At this point, they will arrange for the vehicle to be picked up at a place and time that will suit you.

This means that when you book the collection, you will need:

  • The car's registration number
  • Your preferred time and date
  • The collection address where the car will be
  • Your contact number and your name.

It's also possible to take out another car leasing deal to enjoy a brand-new vehicle and this will be delivered at the same time so there's no need to wait for a delivery.

Your checklist for when your lease car is collected

When you return a leased car, these tips may help.

  • BVRLA guidelines

As mentioned, there are fair wear and tear guidelines that car leasing companies will abide by and the BVR publishes a copy of them

  • Check the bodywork

You should check the bodywork at least a month before your agreement ends and a collection will be due. This will give you the time to get minor damage such as scratches to the paintwork repaired and don't forget to check the alloy wheels for scuffing.

  • Check the interior

It's also crucial to check your lease deal car's interior and ensure that the equipment works properly, and that any special features that were added are still in the car. Also, check the upholstery for bad odours or stains. It's worth considering having your car professionally cleaned for peace of mind.

  • Personal items

The car leasing company will remind you to remove all of your personal items from the leased vehicle because once it is taken away, it's unlikely that personal possessions will be returned.

  • Paperwork

Don't forget to organise your paperwork correctly so you have the original car leasing documents as well as its service history. You may also need a valid MOT certificate if you have leased the car for more than three years. Remember that you need to hand over all sets of keys too.


What happens when you damage a leased car?

We touched upon this subject earlier in the article, but what happens when you damage a leased car?

A reputable car leasing company will abide by the fair wear and tear guidelines published by the British Vehicle Rental and Leasing Association (BVRLA).

These guidelines will be crucial when inspecting your vehicle and assessing whether the damage is serious enough to need the repairs to be paid for, or whether it is minor damage and will come under the fair wear and tear guidelines for leased cars.

But what is acceptable fair wear and tear? Here are some acceptable issues:

  • Tyre tread depth must be above the 1.6 mm minimum legal requirement
  • Light scuffs no larger than 25 mm on the bodywork
  • Slight wear on the upholstery that comes from normal use.

Unacceptable fair wear and tear issues will include:

  • Chips in the windscreen
  • Multiple dents on a single panelled the bodywork
  • A tyre tread depth of less than 1.6 mm - this makes the tyre illegal
  • Permanent upholstery stains.

It's also worth noting that if you are handed an end of car lease charge, that you can dispute this.

You'll need to raise issues with your car leasing firm and be prepared for an independent third party to examine your lease car.

However, the third party will make an assessment that is final and if it doesn't go your way, then you cannot appeal again.

What is an excess mileage charge?

When you agree to lease a car, you will have an agreed mileage limit per year.

Should you go over this mileage allowance when your agreement ends, then you will be handed an excess mileage charge.

This will be levied on a pence per mile basis and the amount being levied will vary between car leasing companies from just a few pence per mile, to substantially higher charges.

The reason why you will be handed an excess mileage charge is that the car leasing company will be looking to be compensated for the depreciation incurred by having those extra miles.

These miles will affect the car's residual value which is what your initial monthly payment was calculated on.

It's important to note that if you choose to have a 10,000 miles per year mileage limit, that the allowance spreads over the full length of your lease company’s agreement. So, if you have fewer than 30,000 miles when you hand the car back, then you will not be liable for an excess mileage charge.


Advice when your car lease ends

For more help and advice when your car lease ends and it’s time for returning the car, you should speak with the team at Tilsun Leasing who will be happy to answer your questions on 03330 040 888.

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Lex Autolease
Leasing Broker Federation

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