Types of Vehicle Leases

You will encounter two main types of vehicle leasing when comparing vehicle leasing companies. The options presented in leasing allow all kinds of customers to find the perfect leasing agreement with the company.

Open-ended

Leasing a car with an unlimited duration means that you are responsible for the financial risks associated with owning a vehicle. This is an ideal agreement for enterprises, since you can write off or pay the risk, and the remaining cost of the car needs to be paid only at the end of the contract, which is rather low, especially for enterprises. However, in the case of personal leasing, leasing a car with an unlimited duration will mean that you pay higher monthly payments for the vehicle to cover the financial risk that you have taken.

With this type of leasing, you are responsible for the market value of the car at the end of the period. You may be required to buy a car and sell it to pay the residual and market value of the vehicle, which is currently associated with taxation and valuation of the vehicle. Businesses are more likely to do this than private individuals leasing a car with an open rental.

Closed Finished

Closed-term vehicle leasing is the most popular car leasing option for individuals since it has minimal obligations by the end of the leasing period. As long as the car is used in relatively good driving conditions, it corresponds to the required mileage and that it is possible to estimate the depreciation for a vehicle, anyone can rent a car at a reasonable price and finally return it.

The residual value of a car often determines whether you buy it from a company or return it. If this amount is higher after the leasing period, you can buy a car and sell it profitably, but if it is lower, the company will cover the costs of returning. It is up to you to decide what to do at the end of the lease, depending on the result of the processing of the vehicle.

Before you start leasing vehicles, you should always know which of these two types of leasing you are offered and what value they represent for you. Companies and individuals have different needs, so choose the right lease that will serve you best.