Contract Purchase
Contract purchase is another form of car finance – or business car leasing – which we at carleasinguk.com are able to provide for the corporate. Contract purchase is a popular form of car finance within the business community, providing as it does a fixed cost monthly payment on a vehicle – or vehicles – in which a particular vehicle for the contract purchase can be stipulated by the company, or chosen on behalf of the end user by the company. In every case we are able to advise on the choice of vehicle to be written into the contract purchase agreement, but will always leave the final choice to the end user. Contract purchase agreements can be tailored specially for the company’s needs – although the industry norm for a contract purchase agreement is usually two, three or four years if a corporate or business user wanted a period between any of these dates we would be able to write a contract purchase agreement to reflect the client’s wishes.
As with contract hire, the monthly costs of a contract purchase agreement are calculated by using the purchase cost of the vehicle, the duration of the contract period required, the projected annual mileage and the value of the vehicle at the end of the contract purchase agreement. The vehicle’s value at the end of the contract purchase agreement term is also known as the guaranteed future value, or more commonly, the “balloon payment”. With a contract purchase agreement you have the option to agree to settle the balloon payment at the end of the term; to have the vehicle collected and start a new contract purchase agreement or to just “walk away”.
Using a contract purchase agreement to fund a company’s motoring needs – whether for one vehicle or several – gives the corporate user a pre-determined monthly payment, which shows the monthly and annual vehicle finance costs, leaving the user to provide consumables such as insurance and fuel. Maintenance can also be written into the contract purchase agreement, making even easier monthly budgeting and to project accurately the annual car finance costs.
Virtually every vehicle that carleasinguk.com supply, on any type of car leasing agreement including contract purchase, is a brand new vehicle sourced and supplied through our UK-wide franchised dealer network. These vehicles are provided with the first year’s road fund licence (and depending on the contract purchase funder sometimes subsequent years’ road fund licence will be included in the contract). Additionally, the vehicles all benefit from the full manufacturer’s warranty provision, and will include - at least for the first 12 months of the contract purchase agreement’s life - full breakdown cover with roadside assistance, again according to the manufacturers provisions. Every vehicle supplied by carleasinguk.com on any type of contract, including contract purchase, will be delivered directly from the supplying dealer to the end user’s place of work or home address, according to their instructions.
Each contract purchase client will have the services of their own account manager and our Customer Services department throughout the life of their contract purchase car leasing agreement, and our Customer Services department will write to them shortly after delivery confirming details of their contract purchase agreement, all warranty and breakdown/assistance numbers and their Customer Services representative’s contact details.
