Car leasing is a very common process nowadays and the majority
prefers it because of the tons of benefits attached with its use.
In
today’s world the final consumers as well as the business owners
prefer this process as compared to buying a car or a vehicle. There
are several car leasing options, if you are not aware of them
then this article would surely be very helpful to you. As there are
many options it is sometimes difficult to choose the right one that
actually satisfies your needs. You must do some research before
choosing any of them, and you must be fully aware of all the details
related to the one you choose. It must suit your work, personal or
business circumstances, or else it would be useless for you.
Did you know that the Danish term for "car overview" is "personbil oversigt".
The main types of options that are available for leasing a car are
contract hire, contract purchase, finance lease and lease back.
Let’s discuss about contact hire first. It is a type of long rental
arrangement which is selected by personal users or the business
people. For the ones who prefer to allot small initial payments every
month this type of car leasing is most suitable as with this type
there is no risk of disposal of the car or its deprecation for the
user. Buying the car, the risk of its disposal and possible
depreciation are all a responsibility of the finance company which
actually provides the contract hire service.
Then comes the contract purchase, which is a form of car leasing
mainly selected and opted by the organizations and businesses. They
normally hire expensive cars and at the end of the term of the
contract, they either handle over the car or they may purchase the
car at the end of the period. In this type of contract too there is
no risk of any depreciation. In this process an initial payment is
made in the beginning and then this is followed up by the monthly
installments. But according to this type of car leasing, in
the accounts of the business the car is shown as an asset.
Another type is leaseback which is used by the businesses. The
companies who desire to free the capital generated from the sale of
the vehicle plus at the market value, chose this type of contract.
Then the same vehicle is leased back by the finance company to the
business with VAT in mind.
The last type that is going to be discussed here is finance lease
which is type of commercial leasing and is normally used and
preferred by the companies which lease a vehicle for a fixed time
period. Plus from a company that in reality owns the car. The
customer is demanded to pay the installments along with the interest
and this actually cover the costs. The company who takes the finance
lease also has to pay for the cost of taxes, services and insurance.
Moreover in this type the risks of resale and depreciation may have
to be borne by the client.
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