Terminating a personal contract hire lease early
Discussion
mercGLowner said:
I suspect these things are negotiable, depends how big your balls are and whether you just say, you're not having the extra money and i'll see you in court.
In my experience you can negotiate any charges when you hand a lease car back. I've had three company cars now and not paid a penny for damage. They were well looked after but had average wear. Every time they tried to hit me for about 500 quid and I managed to get away with paying bugger all. There were different circumstances for each that helped though. Not saying I'm a master negotiator, maybe just lucky, but it's always worth fighting the charges they'll invariably hit you with when the car goes back.Edited by mercGLowner on Friday 24th May 16:35
As for getting out of a BMW early (on Alphabet), that's a lot harder. I tried a couple of months ago and there seems absolutely no way out. You either pay all payments due or get someone to buy the car from them for a ridiculous amount. Why they think you'd pay them the rest of the lease and give them the car back is beyond me. Not really a solution is it?
Anyway, does anyone want an F30 320d for 2 years with no deposit to pay?
nc11 said:
Reviving this thread to ask if anything has changed since 2013... Has it?
Looking at options so would like some clarity on terminating early!
Ultimately you are in the hands of the lease company , based on others comments in similar threads it seems the premium brands (BMW and Mercedes) are not very flexible on ending early and will want the full amount due or close to it however in my own experience of other lease companies (non-manufacturer owned) there can be flexibility, some will agree to accept a proportion of remaining rentals (at least 50% ime) if it works for them to do so. Looking at options so would like some clarity on terminating early!
You'd have thought, given how volatile the jobs market is these days, and how popular leasing has become, that there'd be some insurance you could buy at the outset to deal with any expense arising out of early termination. If you find yourself being made redundant you really don't want to have to use money that you need to pay for food and shelter to cover an early termination fee on a car lease!
MitchT said:
You'd have thought, given how volatile the jobs market is these days, and how popular leasing has become, that there'd be some insurance you could buy at the outset to deal with any expense arising out of early termination. If you find yourself being made redundant you really don't want to have to use money that you need to pay for food and shelter to cover an early termination fee on a car lease!
Hmmmm, that didn't turn out too well when it was offered on hire purchase agreements though did it.....Daughters ex boyfriend was forever ending PCH agreements, some cars only lasted 5 weeks before he ended the agreement, in the short space of time he was in my daughters life he must have had at least 7 PCH vehicles that he terminated early. He had a mix of VW's, Audis and a Peugeot
He talked our daughter into getting a 108 on a PCH and then 5 weeks later into an Audi A1, if I remember rightly cost her around £1800
He claimed it didnt cost him a lot to keep doing it, however he was full of BS, so we dont really know. What I do know is that the lease companies wont be taking it on the chin each time!
He talked our daughter into getting a 108 on a PCH and then 5 weeks later into an Audi A1, if I remember rightly cost her around £1800
He claimed it didnt cost him a lot to keep doing it, however he was full of BS, so we dont really know. What I do know is that the lease companies wont be taking it on the chin each time!
I've heard that there are companies out there that will take it off your hands for a fee. So you can imagine that if you have 12 months left at £300 then that's £3600 plus any damage or mileage XS, then you might get out for £2k and a handback. The dealers might be up for this too, after all they can hire it again. Quite a few ex PCP cars go back out for another go, I know my parents have ended up in a 2 year old ex PCP car, and they are signed up for the next 4 years. No, I wouldn't have done that either, but that's old people for you.
One question - what do the dealers make of any corrosion to wheels and the like? My guess is that they will try to lift your leg and charge you for the "damage", but then I'm a cynical old sod. I'm rather concerned that my folks are in for a tucking-up come handback, they aren't really cut out for the modern commercial world any more.
One question - what do the dealers make of any corrosion to wheels and the like? My guess is that they will try to lift your leg and charge you for the "damage", but then I'm a cynical old sod. I'm rather concerned that my folks are in for a tucking-up come handback, they aren't really cut out for the modern commercial world any more.
Nickp82 said:
Hmmmm, that didn't turn out too well when it was offered on hire purchase agreements though did it.....
You didn't mention taking out cover against early termination though. I accept that there'd be a fee to pay for early termination. My suggestion is that there should be an option to pay for cover, when you first take out the lease, to protect yourself from this cost should you have to exit for reasons beyond your own control.MitchT said:
Nickp82 said:
Hmmmm, that didn't turn out too well when it was offered on hire purchase agreements though did it.....
You didn't mention taking out cover against early termination though. I accept that there'd be a fee to pay for early termination. My suggestion is that there should be an option to pay for cover, when you first take out the lease, to protect yourself from this cost should you have to exit for reasons beyond your own control.
I am ending my personal lease on my Audi A6 early, 18 months into a 24 month contract. There is logic behind this, the early settlement fee is 55% of the remaining lease payments, 6 in my case. The A6 is due a service in 2500 miles (c£500-£600) and two new front tyres (C£320), so it makes sense for me to get out early before these expenses. The replacement car is ordered and is a 12 month contract hire on a BMW3 series, I will keep this to the end of the contract!
Nickp82 said:
So unless I am mistaken you are suggesting something along the lines of Payment Protection Insurance?.....
Sort of. Basically, when you take out a lease you'd pay a one-off premium that would insure you against the cost of an early exit penalty should you need to wash your hands of the car at any point before the end of the lease. For example, you're made redundant and you need your redundancy money for food and shelter rather than having to blow it on an early exit fee before applying to become a Big Issue seller.FYI I'm having direct experience of Contract Hire at the moment.
VW Golf hired from VW Finance 24 month contract.
The rules are after 12 months early termination is 55% of the value, before it's 65%. Mileage is pro-rata whatever you've agreed.
The employee who used it was sacked so there's no need of the car & now my company has gone pop hence there's no money either. The car was underwritten by me stupidly hence it was a business plan but effectively it's now a personal one.
Of course I've tried every way of getting out of this but to no avail - the bottom line is the choices are, for a CONTRACT HIRE:
- pay the early termination amount.
- keep the car & use it till the end of the agreement at normal rates
- persuade a friend or someone else to take on the deal
If you go for the latter than you have 2 options
- get the finance company to vet & approve the new person (+ a fee I'm sure + delays) then fully transfer the contract (+ get out of responsibilities)
- get your friend to pay the bills instead as the finance company don't car who pays the bill or drives it as long as they have someone's name on a contract - it will still be you though.
If you say 'I've got no money, I'm not in default, it's currently insured, please pick it up, I will probably be going bankrupt personally shortly, you will then get £0 anyway so why not pick it up now rather than in many months time'....
They will say 'sorry, we can't do that. We have to wait until you've been in arrears for 2 months then we'll instruct bailiffs etc to collect it at lots of cost to us. Even though, as a bankrupt, you will be unaffected by CCJ's etc etc as the courts will already have taken everything that a bailiff etc could possibly take. Even though we won't get back any of the costs we will have incurred + the car will be older + it may have been damaged etc etc etc.'
It's a slightly mad system but you have to realise from their point of view they cannot have any escape routes because otherwise others will use them. With a PCP or HP agreement you can legally hand the car back once you've paid 50% of the total costs (see Citizen's Advice for info on how to) but with Contract Hire it's locked.
That's why they are so keen on Contract Hire.....
Caveat Emptor or maybe Caveat Hirer
VW Golf hired from VW Finance 24 month contract.
The rules are after 12 months early termination is 55% of the value, before it's 65%. Mileage is pro-rata whatever you've agreed.
The employee who used it was sacked so there's no need of the car & now my company has gone pop hence there's no money either. The car was underwritten by me stupidly hence it was a business plan but effectively it's now a personal one.
Of course I've tried every way of getting out of this but to no avail - the bottom line is the choices are, for a CONTRACT HIRE:
- pay the early termination amount.
- keep the car & use it till the end of the agreement at normal rates
- persuade a friend or someone else to take on the deal
If you go for the latter than you have 2 options
- get the finance company to vet & approve the new person (+ a fee I'm sure + delays) then fully transfer the contract (+ get out of responsibilities)
- get your friend to pay the bills instead as the finance company don't car who pays the bill or drives it as long as they have someone's name on a contract - it will still be you though.
If you say 'I've got no money, I'm not in default, it's currently insured, please pick it up, I will probably be going bankrupt personally shortly, you will then get £0 anyway so why not pick it up now rather than in many months time'....
They will say 'sorry, we can't do that. We have to wait until you've been in arrears for 2 months then we'll instruct bailiffs etc to collect it at lots of cost to us. Even though, as a bankrupt, you will be unaffected by CCJ's etc etc as the courts will already have taken everything that a bailiff etc could possibly take. Even though we won't get back any of the costs we will have incurred + the car will be older + it may have been damaged etc etc etc.'
It's a slightly mad system but you have to realise from their point of view they cannot have any escape routes because otherwise others will use them. With a PCP or HP agreement you can legally hand the car back once you've paid 50% of the total costs (see Citizen's Advice for info on how to) but with Contract Hire it's locked.
That's why they are so keen on Contract Hire.....
Caveat Emptor or maybe Caveat Hirer
mercGLowner said:
Buster73 said:
A mate of mine leased an X5 , hand back time the guy pointed out some minor scratches , normal wear and tear in his eyes.
£1300 bill from lease company , not negotiable.
I suspect these things are negotiable, depends how big your balls are and whether you just say, you're not having the extra money and i'll see you in court.£1300 bill from lease company , not negotiable.
Edited by mercGLowner on Friday 24th May 16:35
I was told from the inspector guy (who was actually an alright guy), lease deals that are 2 years or less will probably go to a forecourt so they want it in tip top condition. 3 years or more it goes straight off to auction (in most cases). Plus you have to factor whatever the contracted miles are.
I recently just returned my Golf R lease early (20 months into a 24 month contract). As mentioned above, the charges incurred were 55% of the remaining monthlies (55% of 4 x £180pm = £396) + any excess mileage on a pro rata basis at 6p + VAT per mile (for me my charge was around £200).
As for damage charges, they sent a BCA inspector to have a good look around the car and go through his check list looking for damages. This took around 15-25 minutes. A few days later when the car collection driver came to take it away, he too inspected the car again, so anyone who is thinking of swapping the wheels/tyres (or anything really) for first inspection, it won't work.
I myself didn't get any damage or tyre charges and from my experience think their assessments are more than fair. They're certainly not out looking to hammer you on damage charges anyway.
As for damage charges, they sent a BCA inspector to have a good look around the car and go through his check list looking for damages. This took around 15-25 minutes. A few days later when the car collection driver came to take it away, he too inspected the car again, so anyone who is thinking of swapping the wheels/tyres (or anything really) for first inspection, it won't work.
I myself didn't get any damage or tyre charges and from my experience think their assessments are more than fair. They're certainly not out looking to hammer you on damage charges anyway.
Eth2312 said:
VERY negotiable, we had an £800 bill from Skoda for a previous work car, argued it and stated things like mileage, condition overall etc etc, ended up with a £95 bill for a replacement tyre only. People say you cant negotiate but you can.
I was told from the inspector guy (who was actually an alright guy), lease deals that are 2 years or less will probably go to a forecourt so they want it in tip top condition. 3 years or more it goes straight off to auction (in most cases). Plus you have to factor whatever the contracted miles are.
That's a different scenario from the OP though, who wants to terminate his lease earlyI was told from the inspector guy (who was actually an alright guy), lease deals that are 2 years or less will probably go to a forecourt so they want it in tip top condition. 3 years or more it goes straight off to auction (in most cases). Plus you have to factor whatever the contracted miles are.
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