Car Leasing Blog

If you, or one of your friends are considering terminating a car leasing contract early, you really need to read this. The implications for terminating a lease early are varied depending on wether it was a business leasing contract or a personal leasing contract. But in both cases, the implications arent great.

Business Leasing Contract

Normally speaking we are talking about contract hire. Basically the contract hire company can charge what they like. But the general rule of thumb is 50% of the remaining payments, so if your payment is £200 per month and you have 10 months to run, expect to pay £1000 return fee. Dont forget that you will still have to pay for anything that isnt deemed fair wear and tear.

Personal Leasing Contract

If the contract you have is PCH, please refer to the answer above, however if your contract is PCP or HP - stop now!. With a regulated hire purchase agreement (such as HP or PCP), returning the vehicle early is commonly knows as Voluntary Termination and finance companies take a very dim view on it.

Yes, it is your consumer right once 50% of the contract is paid to return the vehicle without penalty, but just you try to get a loan or credit card afterwards - no chance.

I have worked in a sub prime department, and usually VT (Voluntary Termination) cases go nowhere, even when CCJ cases can be placed.

So (and this is very important) if you are considering sending your lease car back early - make sure you get the right advice first, otherwise you could be paying for it next time you want a mortgage or loan.