In the modern world, the vast majority of people use cars. But not everyone has the opportunity to and quickly buy a car. If there is not enough money to buy at the moment, you should not abandon your dream of a car. After all, there is such a service as car leasing. Thanks to her, the dream will become a reality.
Leasing: key concepts
Leasing is the rental of a car with a subsequent possibility of redemption. In essence, the customer pays the cost of the car in installments, as if he had taken out a loan. But until the end of the payment, the car remains the company's property. This combination of rent and purchase makes it possible not to pay the entire amount at once.
Car leasing - pros and cons
As in any other business, this business has its advantages and disadvantages. The undeniable advantages include:
- a minimum of documents is required for the execution of the contract;
- you can buy a used car at a bargain price ;
- the registration procedure takes a little time;
- you can buy or exchange a car for another model.
There are also a couple of disadvantages:
- There is a risk of losing the car. This happens if you miss a mandatory payment.
- Currency risk. If the contract is tied to the cash exchange rate, you will have to pay payments by the exchange rate.
Development of car leasing in Ukraine
Recently, the demand for leasing has been increasing, not for taking a loan for a car. This happens because leasing companies are much more loyal to customers than banks. The bank has a clearly defined policy and rules, from which it is impossible to deviate. In leasing, customer orientation flourishes more. For example, if the client has no problems with their credit history, he or they can be given a reduced rate. Also, the term of payment of leasing payments is made taking into account the wishes of the lessee.
Based on this, leasing companies are more popular than banks since the conditions are more favorable. But at the same time, it is worthwhile to soberly assess the situation so as not to fall for scammers. If the conditions are too loyal, you should think carefully before agreeing.
The development of leasing in Ukraine is beginning to gain momentum. Especially after the government considered the law on excise taxes on used vehicles, it was hoped that prices for new cars would also fall. But this did not happen, and the automotive market continued to develop, as the demand for cars did not subside.
In this regard, many companies have appeared that offer leasing services. As a result, they significantly benefit from banks with reduced requirements for assessing the solvency of customers.
What do you need to conclude a contract?
To conclude a contract, the client must be at least 25 years old, have five years of driving experience required, and be willing to pay a third of the cost of the car. In addition, to receive the desired car, the lessee must present the following documents to the lessor:
- Ukrainian passport;
- identification code;
- driver's license;
- An additional document that certifies identity, for example, a passport.
That's the whole list of necessary documents for the dream car to be in the hands of the buyer.
The procedure for obtaining a vehicle on lease
To do this, you need to go through several stages. Everything is quite simple and transparent for the recipient of the car:
- The client chooses the car he likes, which is suitable for all characteristics and provides the company with documents prepared in advance.
- The company's representative checks the documents and then decides on the contract's conclusion or non -conclusion. It contains all the detailed terms of the transaction, the exact amount and maturity of payments, a list of services, and the conditions for transferring the vehicle to the lessee's ownership. According to this document, the latter undertakes to make payments on time. It is also indicated in the contract whether the cost of the car and the number of payments are tied to the dollar exchange rate.
- After signing the contract, the car can already be used, but until the end of the payments, it cannot be resold or given for use to outsiders.
- With the last payment, the tenant receives full ownership of the car and can dispose of it at his discretion.
Loan or lease - what to choose in the end?
For many, leasing a car and a loan are almost the same concept. But this is far from true. The leasing procedure has many more advantages compared to a loan:
- Mandatory payments in leasing are often much less than in a bank. They mainly depend on the initial amount.
- The payment schedule is set considering the client's wishes, so it is much more convenient than a hard bank one.
- The contract procedure is straightforward and takes a minimum amount of time.
- The same applies to the required package of documents - a list of just a few positions.
- After the expiration of the contract, it is possible to either pick up the car or exchange it for another.
- When drawing up a leasing agreement, purchasing a vehicle for commercial purposes is possible, but it is tough to do this on loan to an individual.
- If such a need arises, it is much easier to terminate the leasing agreement.
There are several disadvantages of such a lease:
- Until the last installment is paid, the company owns the car and has the right to withdraw the vehicle if the contract is not complied with.
- The machine cannot be rented to third parties.
The advantages of leasing outweigh such an agreement at the bank. That is why there are more and more such contracts.
Leasing or rent?
If we compare the contracts for these services, we can distinguish the following differences:
- When renting, only two parties participate in the contract - the car company and the tenant, while in leasing, there are three parties.
- The lease agreement is signed for any period, leasing for a maximum of 5 years.
- With a standard lease, the vehicle must be returned to the lessor after the expiration of the contract; with car leasing, the car remains the property of the user.
- When renting a car, you only need to pay a certain amount. In leasing, you will need to cover expenses such as insurance, vehicles, etc.
Despite some disadvantages of car leasing, more and more people are starting to use this service since the advantages of this agreement are much more significant.