What are the different types of van fleet financing available?
When considering whether to lease vans for your business, it can be tricky to understand
which van finance option is best. But don't worry, Vansdirect is here to help!
Our team of fleet sales managers will find the most suitable van fleet finance product for your business.
Van leasing allows businesses to hire fleets of new vans, paying monthly rentals for the duration of the contract. At the end of the agreement, the business has the option to extend the lease or buy the vehicles outright.
Benefits of finance leasing:
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- Lower initial costs: vans on finance lease have a lower initial outlay compared to outright purchasing.
- Fixed monthly payments: set payments help to make budgeting and financial planning more predictable.
- Flexible options: at the end of the contract, businesses can pay the final balloon payment to keep the van or sell it, with the proceeds of the sale used to pay the final balloon payment, and upgrade to a new van on a new lease agreement.
Contract hire involves a business hiring a van fleet for the length of an agreement (typically two to five years). The vehicles are always returned at the end of the contract, and there is no option to purchase. This is ideal for businesses that don't want to own the vans at the end.
Benefits of contract hire:
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No depreciation risk: as the business will never own the vans, there is no need for concerns over the risk of depreciation.
Opportunity to upgrade: businesses are able to upgrade their fleet at the end of the contract to newer models.
depending on the agreement, you can add servicing and maintenance contracts to help avoid any additional repair costs.
With a hire purchase agreement, the business pays an initial deposit, followed by monthly instalments. Once all payments have been made, the business owns the fleet of vehicles.
Benefits of hire purchase:
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Flexible terms: businesses can choose their repayment terms, which allows for more straightforward budgeting.
No mileage restrictions: as the business owns the vans there are no restrictions on mileage. This can be particularly beneficial for businesses with high-mileage requirements.
To find out more about van fleet financing get in touch with our customer services team today.