What are contract hire early termination charges?
It is important however that if your circumstances change and you want to send the vehicle (car or van) back early, the vehicle leasing company will charge you an early termination fee to compensate themselves.The reason why they do this is because they have calculated a monthly rental for the original term you agreed to, (let's say three years) and if you suddenly send it back after a year, they have to dispose of the vehicle earlier than they thought and will probably make a loss on disposal at the auctions.
They have also had to borrow the money to purchase the vehicle in the first place and have spread their cost of funding and profit across the three year period, not one year. They have to make sure they are "not out of pocket" and this is why they will charge you an early termination fee.
Early termination charges on contract hire do vary and are usually calculated as a percentage of outstanding rentals i.e. 50% for example. Each leasing company is different and you should read their leasing contractual agreement to understand the potential charge as some vehicle leasing companies may charge more than 50% (or less).
In addition to the early termination fee, based on a percentage of outstanding rentals, the vehicle leasing company will also check the mileage on the vehicle, in case you have travelled in excess of your contractual mileage allowance plus the condition of the vehicle for a fair wear and tear assessment.
If you find that you no longer need a particular vehicle on your fleet it is always best to see if one of your other drivers can take on the vehicle in the short-term.Or perhaps another company you know may even agree to take on your vehicle.
If you do know another company who is prepared to do this the vehicle leasing company will need to underwrite them as they will assign (transfer) the lease to them. Please note that you will have to agree with the other company who has responsibility for items such as excess mileage and fair wear, to avoid any misunderstanding in the future.
We have shown some examples of Honda vehicle leasing and Hyundai vehicle leasing prices below and any make or model of vehicle can be quoted off the Exact Model Vehicle leasing quote engine. If you see a leasing rental you like just fill out the CONTACT form and one of our vehicle finance partners will be in touch.
From £115.47 ex. VAT
From £132.19 ex. VAT
From £145.67 ex. VAT
From £149.00 ex. VAT
From £186.68 ex. VAT
From £191.23 ex. VAT
From £197.90 ex. VAT
From £200.85 ex. VAT
From £214.94 ex. VAT
From £218.00 ex. VAT
From £222.91 ex. VAT
From £224.37 ex. VAT
From £224.93 ex. VAT
From £227.84 ex. VAT
From £230.03 ex. VAT
From £232.38 ex. VAT
From £236.90 ex. VAT
From £248.38 ex. VAT
From £250.27 ex. VAT
From £252.00 ex. VAT
From £273.00 ex. VAT
From £284.90 ex. VAT
From £287.90 ex. VAT
From £293.91 ex. VAT
From £297.39 ex. VAT
From £306.90 ex. VAT
From £312.05 ex. VAT
From £320.33 ex. VAT
From £321.03 ex. VAT
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