What happens at the end of a vehicle lease contract?

There are many questions regarding what happens at the end of a vehicle lease contract or contract hire agreement. For the few horror stories that you may have heard amongst thousands that go without issues, they all have one thing in common…  communication.

It’s your responsibility to look after the vehicle and make sure it’s in good order during agreement.

Please make sure you have discussed this with your broker before entering any agreement. There are many ways to help and any broker worth your custom should explain this fully.

Pinksauce offer a range of products, insurances and work with awesome local businesses that can help maintain your vehicle to the standards required. Please click on our What We Offer page to find out what we can do for you to keep driving and smiling.

Who collects my lease vehicle?

There are a number of collection agencies who are sub-contracted by finance companies. Therefore service and communication levels may vary.

Once you have agreed a date for collection stay with that date unless there’s a major issue. There may be costs involved otherwise.

On a few occasions the collecting company have contacted my customers on the day of collection usually after lunch to tell them the car won’t be collected.  It’s a good idea to make note of this if it happens because it may come in handy later in the process.

Who decides what’s wrong with my vehicle?

I spent 2 days on the British Car Auctions (BCA) driver collection course to fully understand what they ask of their drivers, they are the largest collection agency.  It was rather more detailed than I expected and backed up with decent technology.  I-pads, PDA’s, paint depth gauges and a rucksack full of magnetic scratch and dent measurement stickers.

Once the visual inspection and filming has taken place this is uploaded and based on the industry pricing for the repair a quote is calculated. This can add up if the vehicle is not in decent order.

So those upgraded diamond cut alloys need to be immaculate and the AMG / M Sport body kits perfectly presented.

If you are local please contact me. I can visit and walk round the vehicle and suggest what may be issues if not repaired or fixed.

Pinksauce Leasing works in partnership with Smart Repair and Alloy Repair insurers and Authorised Repairers. On average it cost £10 a month to protect your paintwork against little scratches and dent plus your alloys too. Please click on to our What We Offer page to see.

What if the quote is expensive?

If the inspection produces a quote that is more than you expected after consulting the Fair Wear and Tear guidelines (usually sent with your paperwork) do not sign the paperwork to agree with the inspection. Say you will challenge the quote with the finance company but this could take time. If the cost is huge and you don’t feel comfortable letting the vehicle go and you can repair it using your own insurance or contacts then take the hit on the cancelled collection charge.  This is a very last resort. It creates a lot of extra hassle so please keep inspecting your vehicle throughout the agreement. Don’t let issues build up. Remember if your collection has been cancelled by the drivers company use this in any negotiating with the finance company. You kept to your side of the collection date.

See below to read how I challenged the finance company when I returned one of my cars.

How do I protect or educate myself when returning a leasing a vehicle?

Please request or search for the fair and wear policy from the finance company (if you don’t have it with your paperwork) or use the BVRLA website to arm yourself with some knowledge.  On a few occasions I have been there when customer’s cars have been collected just to make sure everything is recorded and priced correctly. Don’t leave it until the last minute though, be prepared and organise the relevant repairs to be done in good time.  Like I mentioned at the beginning, communication is everything. Don’t forget to chat it through with me if you’re not sure or have any questions.

Always challenge the decisions made by the collection driver if you feel they fall outside of the policy but be good mannered about it.

What can I do during my vehicle agreement?

Be prepared and aware.  Look after the vehicle, keep it clean and regularly walk round and check the paintwork and alloys if fitted. This little thing will protect you from unforeseen end of contract costs.

Ask yourself a couple of questions?

  1. When and how often do I need to service my vehicle?
  2. How much is servicing likely to cost during me having the vehicle?
  3. Do the tyres cost a lot?
  4. How about cleaning and valeting?
  5. What if I scuff the bumper or someone scratches or dents it in the car park?
  6. When scratches mysteriously appear on the alloys, what do I do?
  7. What if the kids wreck the seats?

There are many more questions we ask ourselves but more often than not customers focus on the car in relation to their budget. Everything else can wait ‘til it happens. My advice is to take everything into account.  If you have the income to cover all eventualities then great, that’s go for it. But if 2020 has taught us anything, nothing is guaranteed so proceed with common sense and caution.

The vehicle that makes you smile at the beginning might not be the same vehicle at the end of the agreement.

What else should I know?

Based on my experience on the 2 Day BCA Driver collection course please be kind and respectful to the driver. They are only working within guidelines set by a system and using software to price damage.

If the driver is a fulltime employee of the company they tend to be looked after and usually have the nicer jobs. If they are self-employed they have the most pressure on their time and the standard of their appraisal. Some have to work over 12 hour a day just to earn £60 after all their travel costs between collections. They may also be docked payments if they miss any damage on the vehicle so this may result in tougher inspections but you can ask them to explain their decision. Don’t forget you have the right to disagree and sign the paperwork detailing this.

The inspection will be thorough so don’t be offended but you and I would do the same if we were buying a used car personally.

The Chichester area is not the best area for collection coverage so the drivers will earn a little more per collection to help cover train, bus or taxi fares due to the rural locations.

So make it easy on you and the driver by making sure the car is presented in a decent manner with minimal points of contention.

Speak to me if you have any questions or need any advice.

What happened when Chris from Pinksauce Leasing returned his Lease car?

I took a 14 month personal contract on a Citroen C1 Flair based on 12,000 miles per year. 4 months into the contract my situation changed where I didn’t travel as much and so I only drove local to Chichester.

I decided to try my luck and not service the car at 12 months as the car was going back a month later and the mileage was really low. My thought was if they charge me £80 for the missed service that’s okay and fair but if I was really lucky they wouldn’t at all.

There were a couple of little stone chips on the bumper and some very faint brush marks on the roof where the car wash had left its signature. This is more about the thin paint and lacquer on the C1 and old brushes at the car wash. Nothing a soft mop by a decent valeter couldn’t put right either at the auctions or whatever dealership bought the car from the finance company.

Having been in the motor trade for 20 years and appraised 1,000’s of cars, I could make this call with an element of experience and judgement. I also cross-referenced against the guidelines I was sent by PSA finance.

How was my experience?

The collection driver arrived from BCA on time and introduced himself and took a key to commence his appraisal of the car.

15 minutes later he returned to inform me that the service and a complete roof respray would be £444 plus VAT.

I asked him politely to explain his decision, which he did based on the guidelines he has from BCA and Citroen Finance. I disagreed with knowing what I know.

What happened to the lease vehicle?

I agreed for him to take the car but signed to say I didn’t agree with the appraisal and the £444 plus VAT which the BCA software had calculated.

I remembered to photograph and film the roof marks for my records.

Within the week I received a letter from the finance company. They thought the £444 plus VAT was fair based on the damage and missed service.

I called them to discuss and they said they would look at the appraisal again. A couple of days later they sent another letter to say they had reduced the quote to £390 plus VAT and once again I called to discuss.

At this point I mentioned I have worked in the car trade for 20 years. I didn’t agree with the £390 plus VAT or the amount of work required to make this vehicle ready for the used car forecourts. I also mentioned that this was a personal contract. All the figures had included VAT and that this should still be the case to avoid further confusion.

Who did I speak to because I was still unhappy?

They declined to discuss the matter any further. So I told them I would ask the Financial Ombudsman to look at the case based on all the facts.

I spoke to the FO and they were very good. About 6 weeks later they called me to say they had advised Citroen Finance to reduce the figure to £323 including vat.

At this point I decided not to push it anymore. I use the experience to help leasing customers facing similar situations.

What did learn from it?

  1. Choose an affordable vehicle
  2. Look at whole life costs
  3. Don’t try and cut any corners or costs
  4. Consider SMART Insurance
  5. Wash the car myself
  6. Monitor food consumption within (kids!)

So as I wait for the collection of my Volvo V90 after 2 years of enjoyable driving I hope the body shop is repairing the 4 panel scratch plus the Smart Repair on the bumper. A full valet by my friends at Far2Kleen in Bognor will put me in the best position for returning the car to Volvo Finance without any issues.

Finally

I have painted the most honest picture of vehicle leasing covering many eventualities. There’s a lot to learn if you’re new to it but it’s still a great option for many people and becoming ever more popular. People are realising that they don’t need to own something that is going to depreciate anyway.  I have customers on their third contract now and it’s great to see them become more confident with the process. For first-timers I’m always on hand to provide that guidance if needed.

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