Car Leasing Blog

Understanding a car lease payment profile

Information on how car lease payment profiles work, with pizza!

We’re often asked what a 3+35 or a 6+23 mean? They’re both examples of payment profiles for a car lease.

Simply put, the cost of leasing a car is worked out for a given time period, say for example, 2 years. Were that cost divided equally across the whole 24 months, your contract would be a 1+23. That is, 24 equal payments- the first payment being the same as the following 23.

Often, clients will pay a higher first payment (for example, they have some excess cash after selling a privately owned car), or; the lender will often require more than 1 payment in advance as a security.

The cost for the term of the lease (say, 2 years) is fixed, however the payments are made up. Rather than picking an arbitrary figure, like £1000 as a first payment, in leasing we usually show increased first payments as a proportion of the monthly payments. The key point to note, the more payments paid in advance, the lower the following monthly payments will be, the total payable never increases.

Car Leasing PizzaThink of lease payments as a pizza. The total cost of a contract is the whole pizza. If you paid a quarter of that pizza at the start of the contract, the remaining three quarters would be divided by the remaining number of months you have the car. If you start by paying just an eighth, the remaining 7 eighths divided by the remaining number of months will of course be proportionately bigger.

We often show special offers as 6 payments in advance, like a 6+23. Were the monthly rental for example £200, this means your first payment is £1200 (£200 x 6).

We can appreciate you may need help in understanding this if it’s your first car lease- so give our friendly team a call, we’ll be happy to explain it further and get you on your way to driving the car you want for less!

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