Small business owners tend to rule out leasing because they fear the penalties that come with exceeding an allocated annual limit.
Other times, it is the poor advice from sales leasing companies that discourages leasing.
You can lease high-mileage vans if you run high miles. Compared to buying your van, leasing can save you some money, thanks to the tax advantages.
How Does Leasing a High-Mileage Van Work?
If you drive up to 40,000 miles annually or more, it might be worth it to review van leasing deals that cover high mileages.
Business vans need to cover more miles, and a high mileage van lease makes that possible. The penalties for putting low miles on your van and exceeding the miles eventually can add up and be unfavorable.
When you get a high-mileage van, you avoid those eventual charges. However, the result is that you end up paying high monthly payments. More miles on your van means greater depreciation, which is why leasing a high-mileage van costs more.
How Can You Lease a High Mileage Van?
Getting a high-mileage lease van is the same as with short-term leases.
Most lease companies have multiple high mileage van lease deals, so you simply need to choose the most suitable option.
Determine the miles you intend to put on the van and ensure you understand the other terms of the lease. Your dealership may provide room for negotiation so take advantage of that to reduce your monthly fees.
What is the Cost of Leasing a High-Mileage Van?
Several factors like your location and the model/make of the car determine how much you end up paying for the high-mileage lease van.
Here is some information your leasing company will require to come up with a quote:
1. Contract Length
Your monthly payment should reduce if you lease the van for a long time. The payment remains high since it is a high mileage lease, but it will spread throughout the contract.
Long-term leases last between 3-5 years. You will have to determine how long you need the commercial van to get a quote.
2. Upfront Payment
All kinds of lease deals require an initial fee or upfront payment. How much you are willing to pay upfront affects the rest of the monthly fee.
If you prefer a low initial cost, your monthly payments are higher. Some clients prefer to make huge payments upfront to pay less monthly rentals.
3. Annual Mileage
The exact miles you put on the van determines the price of the lease. High mileage leases are more expensive because of their higher devaluation rate.
Estimate how many miles you will drive annually before requesting a quotation. Remember to calculate accurately as best you can to avoid overage expenses for extra miles.
You must maintain and service the van according to the manufacturer’s instructions. The cost of maintaining the van will be added to your lease and will increase the lease amount.
Maintenance packages are often flexible with different servicing options. However, it is best to choose a comprehensive cover so you can stick to the fair wear and tear agreement.
What are the Advantages of Leasing a High Mileage Van?
1. Eliminates Depreciation
An advantage of van leasing is that you do not have to worry about disposal at the end of the lease.
High mileage leases can cover more than 40,000 miles annually. If you lease the van for 5 years, that sums up to a total of 200,000 miles. The vehicle’s resale value diminishes greatly by then, but you are protected from this devaluation.
2. Flexible Contract Periods
Your high mileage van lease can span as short as 2 years or up to 5 years, depending on the dealership.
Business owners may want the high mileage van for just a few years, which is entirely achievable. You can still enjoy short-term leases when covering many miles.
3. Easy Maintenance
You have the option to include a comprehensive maintenance package in your lease. High mileage vans have higher chances of needing serving and repair, and your package can easily cover this.
High mileage van leasing comes with benefits for businesses or individuals, and you can confidently budget for other productive ventures with maintenance costs covered in your lease. Before taking a high mileage van lease, consult your accountant to get advice about reclaiming VAT on rentals or other tax benefits.