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Contract Hire and Leasing Guide - Payment Profiles for Leasing

All Vehicle Contracts Contract Hire and Leasing Guide - Payment Profiles for Leasing
  • Typical Contract Hire initial payment

    Contract Hire initial payments are usually calculated in ‘months’, from 1 month in advance up to 6 or in some instances, 9 and even 12 months in advance. Of course, the higher the initial payment, the lower the monthly payment, therefore it is important to check advertised prices and compare quotes like for like on an overall basis.

    Contract Hire payment profiles


    Contract Hire payment profiles consist of an initial payment and fixed, spread monthly payments based on the initial payment amount for the duration of the contract. Contract Hire payment profiles are also available with a terminal pause (see below).

    Contract Hire jargon explained

    Spread rental

    Here is a spread rental Contract Hire example: 3-year term, 6 payments followed by 35. This means that you will be paying a total of 41 payments. A spread rental agreement summarises the first payment as 1 rental although it equates to 6 payments, hence the name ‘spread rental’.

    Terminal pause

    Here is a terminal pause Contract Hire example: 3-year term, 3 payments followed by 33. This means that you will be paying a total of 36 payments. A terminal pause rental agreement summarises the first payment as 1 rental although it equates to 3 payments and there is a ‘pause’ of 2 months at the close of the contract agreement. This example equates to 36 payments with a 2 month ‘payment holiday’ at the end of the agreement, hence the name ‘terminal pause’.

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    Contract Hire and Leasing Guide