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Understanding Pre-Registered Vehicle Leasing
Delving into the Implications of a Pre-Registered Vehicle Lease Agreement
The vehicle leasing industry presents an intriguing concept - pre-registered vehicles. This term refers to a brand-new car or van that has been registered by a dealer or a finance company before being leased out to a client. Although the notion may sound complex at first glance, it often delivers numerous advantages to leaseholders, from financial savings to prompt accessibility. This composition aims to unravel the complexities of leasing a pre-registered vehicle, presenting the potential benefits, drawbacks, and important factors for potential lessors.
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Decoding Pre-Registered Vehicles
A pre-registered vehicle is essentially a brand-new vehicle registered by a dealership before entering a lease agreement with a client. Dealerships may resort to registering vehicles to fulfil manufacturer-imposed sales targets, which subsequently categorises the vehicles as 'used', despite their very limited mileage. In the leasing scenario, the finance company or the "funder" usually becomes the first owner of the vehicle, while the driver is classified as the vehicle user under the lease contract.
Perks of Leasing a Pre-Registered Vehicle
Cost
Leasing a pre-registered vehicle can often be significantly more affordable than a brand-new, unregistered counterpart. This pricing could be attributed to additional incentives offered by manufacturers to meet specific registration targets within a particular month or quarter.
Prompt Availability
Unlike brand-new vehicles that require a factory order and may involve a waiting period of several months, pre-registered vehicles are readily available for immediate lease and use. The vehicle must physically exist to register with the DVLA.
Vehicle Condition
Pre-registered vehicles typically exhibit near-new conditions. These vehicles have generally covered only a few miles and are usually in pristine condition.
Potential Drawbacks of Leasing a Pre-Registered Vehicle
- Limited Choice: Leasing a pre-registered vehicle may restrict your choice in terms of make, model, specification, and colour.
- Warranty: The warranty period commences from the vehicle registration date, not the lease initiation date. If a pre-registered vehicle has been registered for several months, this could significantly reduce the warranty period left on the vehicle. Generally, a new vehicle carries a 3-year manufacturer's warranty. If the registration date falls on the 31st of March and your lease starts on the 1st of July of the same year, your manufacturer's warranty period would be only 2 years and 9 months.
- MOT Requirement: As per current UK legislation, all vehicles must undergo an MOT inspection after 3 years. For a 3-year lease agreement on a pre-registered vehicle, you may be responsible for the MOT test and any related costs.
- Servicing: Manufacturer-recommended service schedules vary depending on the manufacturer, make, model, and drivetrain (i.e., Petrol, Diesel, Hybrid, or EV). For a pre-registered vehicle, your annual service would be due based on the registration date, not the delivery date.
Factors to Consider When Leasing a Pre-Registered Vehicle
Leasing a pre-registered vehicle requires considering several key points:
- Mileage: Verify the vehicle's mileage – it should typically not exceed a few hundred miles. On vehicle delivery, note the mileage on the vehicle delivery note, as this will be considered when calculating your total contract mileage.
- Lease Duration: Evaluate your lease agreement's duration to ascertain when service, maintenance, and MOT might be due.
- Warranty: Determine the remaining warranty on the vehicle. Remember, the warranty activates from the registration date, not the lease commencement date.
- Maintenance: Consider opting for a fully maintained contract, which covers all routine servicing, maintenance, replacement of worn tires, and in most cases, MOTs.
- Vehicle History: Since the vehicle was pre-registered by the dealer, its history should be relatively straightforward. Nevertheless, ensure that the vehicle hasn't been employed as a demonstrator model, which could result in more wear and tear.
In conclusion, leasing a pre-registered vehicle may be a smart move, offering many of the perks of a brand-new vehicle at a possibly reduced cost. It's crucial, however, to conduct your research and be aware of the key considerations to make an informed decision fitting your circumstances.
For any information regarding pre-registered vehicles, consult with your sales advisor or customer support.
