ARE you a business owner looking to acquire some vans? We understand that this can be both necessary but still expensive, especially when purchasing them outright. As you ponder if it is worth getting a van on finance, there are three main options you can consider – including buying, leasing and the finance option of BCP (business contract purchase).
Buying is the easiest option, but can also be the most expensive option in the short and long term. Buying the vans outright is the easiest because you can simply hand the cash over and drive off with the vans. It does give you full control and full ownership of the vans, which for a business of any size could be seen as a real bonus.
However, if you are a small business, either just starting out or looking to acquire more vans, then buying outright might be too costly for you to do all at once. If that is the case, there are the options for both leasing and getting your vans on car finance.
Also the selling of the vehicles later on will mean you will suffer from depreciation. The value of the vans lost over the length of time you own them will mean you will sell them for a fraction of the price. It might be advisable to keep them for longer than you first intend to counter the heavy depreciation and to get the very most out of the vans. However, this will obviously lead to more maintenance and long term service costs.
Leasing has become even more popular in recent years because of the ability to pay for your vans in small monthly amounts. However, the main backfire with leasing is that you can never own the vans at any point. When your leasing agreement runs out, you must return the vans to the lender.
Leasing is great for budgeting each month as you can work out exactly how much you will pay over your leasing period, which is very helpful for new and small businesses. The majority of leasing deals for vans also last for around 2-5 years and do incur costs if you wish to upgrade early or terminate the contract at any point before the end.
The truth is if you wish to budget your cost for vans better and also own the vans rather than returning them to the lender, then there is only one way. Finance agreements are a great way of paying for your vans on a monthly basis and end up owning them at the end as well.
The most popular finance deals available for business looking to buy vans is a Business Contract Purchase (BCP). It is a brilliant combination of leasing the vans and buying them outright. The way it works is that you place a deposit down (although this is not always the case) and then pay an agreed monthly amount for the required period. However, you may be required to pay a large lump sum at the end of period.
BCP is the more flexible option available when buying vans. This is because of how an agreement can end. If you choose to finance a van, you can at the end choose one of three options.
You can obviously pay that lump sum at the end and take full ownership of the vans. You can upgrade and get a new set of vans on a new BCP agreement. And if you think you have got the most out of that set of vans, you can simply hand them back as you would do with a leasing agreement.
If you are looking to get vans on finance through a BCP agreement, then you have a lot of flexibility when it comes to owning your vans.