Van leasing

To be eligible to lease a van you need to be at least 18 years old, hold a full UK driving licence and pass the appropriate credit checks.

Van leasing works a bit like a long-term rental, giving you exclusive access to drive a new van or pick-up truck for a set period, in exchange for fixed monthly payments. You will also need to cover an initial rental payment upfront, which may be the equivalent of 1 to 12 monthly payments.

The important thing to know about leasing is that you don't own the vehicle and will be required to return it. You may be able to extend your lease or have the option to lease a brand-new van, but you will not have the option to buy the vehicle you are leasing.

At the end of your lease, you must hand the van back to the leasing company. At the time of collecting the vehicle, the leasing company will check the van is within the agreed mileage limits and inspect it to ensure it is not damaged. Don't worry, they don't expect it to be in perfect condition – general wear and tear won't result in any additional costs.

Be sure to perform a thorough check of the vehicle before it's due to be returned so you have enough time to make any repairs outside of fair wear and tear. Any damage outside of fair wear and tear could result in you being charged additional fees. In addition, any excess mileage could result in additional costs.

As a lease is a financial agreement, you will need to have a good credit score to get approved. Before applying, it would be worth checking your credit score. If you have any doubts, feel free to speak to our team on 0330 303 9055 and they can support you before making an application.

Very few lease contracts include insurance, so you'll need to arrange this yourself. When leasing, you will need to take out fully comprehensive insurance on your vehicle for the duration of the contract.

When you take out an insurance policy, you'll need to let the insurance provider know that it's for a lease van and share the terms of the lease, alongside the name of the van's 'registered owner' (normally the lease company) and the names of any additional drivers. You may also want to consider 'gap insurance'. Gap insurance protects against any difference there might be between the insurance company pay-out if your van is written off and the amount left to pay on your lease.

If you exceed your annual mileage, you may need to pay an additional charge. Typically, this is a few extra pence for each mile you go over your agreed-upon limit, depending on the terms of your agreement.

It's often possible to extend your mileage allowance part-way through your lease, so if you think you may exceed your contractual limit, speak to your leasing company to find out if you could avoid unexpected excess mileage fees at the end of your contract.

Business leasing (otherwise known as Business Contract Hire or BCH) operates similarly to Personal Contract Hire, with the distinction being that you lease the vehicle on behalf of your company rather than for personal use.

To qualify for a business lease, the agreement must be with a VAT registered company, and the vehicle can be used by employees for both personal and business purposes. As a result of business leases only being available to VAT registered companies, the cost often works out significantly cheaper than Personal leasing as the company can claim the VAT back. This is why all our business lease prices are quoted excluding VAT.

Leasing is a popular way to get a new van, but you need to make sure it's right for you. Here are some advantages and disadvantages to keep in mind when making your decision.

Pros:

• The initial payment is usually low.
• You'll typically incur lower monthly payments versus other forms of finance (e.g. Personal Contract Purchase, Hire Purchase).
• The lease payments include road tax and the manufacturer's warranty will often last for most of your lease.
• You don't have to worry about the van's depreciation.

Cons:

• You'll never own the van.
• You'll face penalties for excess mileage or damage outside of 'fair wear and tear.'
• Most contracts include fees for terminating your lease early.
• You may have to pay more for specific colours or trim levels.

Autotrader owns a vehicle leasing broker, Autorama. As a regulated broker, Autorama works with a selected group of funding partners to find you the best lease deal.

Autorama has different commission arrangements in place with their Smart Panel members which vary according to the volume of business transacted and them maintaining high levels of customer service. This is reflected in the monthly lease rate that you pay for your vehicle.