Beware of lease car ‘wear & tear’ policies

Only a half of motorists who lease their car understand their ‘fair wear and tear’ policy, potentially costing them hundreds of pounds at the end of their agreement, claims new research.

Car finance deals are rocketing, so more drivers than ever are not buying their cars in the traditional sense, but leasing them via Personal Contract Purchase (PCP) or Personal Contract Hire (PCH) plans.

According to a study by Autoglass BodyRepair of 1,500 people who have privately leased a car in the last five years, one in four lessees are charged for repairs when returning a leased car.

Nearly nine in 10 (89%) of those charges are for repair work as opposed to non-repair charges such as exceeding mileage, missing keys or missing logbooks.

Leasing agreements specify a maximum level of wear and tear that a car can have when returned. If the car does not meet the level stated in the leasing agreement the lessee is charged for repairs, with the average bill for repairs done by a leasing company being £473.

The research found that only half of those who use leasing agreements to “purchase” their car are confident about the terms of the fair wear and tear policy within their agreement.

Those in the other half are either unclear of their policy or do not remember receiving a policy.

As a result, motorists are often surprised to find themselves liable for minor damage when they return their vehicle at the end of the contract, with 69% of those that received repair bills said they were unexpected.

Top tips for returning your leased car

• Familiarise yourself with the fair wear and tear policy for your lease car.
• Appraise the vehicle after it’s been cleaned and in good light 10-12 weeks before your agreement ends. Be as honest as you can, ask a friend or colleague to help.
• If you have any damage, get a quote from a third-party repair company – whether you choose to get the repairs done before returning the car or not, this quote could be helpful if you need to negotiate the cost of repairs with the leasing company.
• Check before getting any repairs done that your policy allows a third-party company to do the repair work. The average charge for repairs by a leasing company was found to be £473 so shopping around and getting repairs done before could save on the cost.
• Check your insurance for windscreen cover – 22% of repair bills were for glass repair/replacement – which could have been done for free as chip repairs are normally covered free of charge by the insurance company.
• Try negotiating – 19% of lessees managed to negotiate a lower cost with the leasing company for their repairs.
• Double check, even if you have leased before. Those who have had more lease agreements are also more likely to get charged penalty fees for exceeding mileage, missing logbooks and missing keys.