The financial models that are available to aid customers who are looking to purchase a car have been refined and fine-tuned leading to improved customer choice. A feature that is very beneficial to customers is to defer a big payment to until after the lease is over so that monthly payments are kept within a highly comfortable range. This has the effect of doubling the deposit that is made by the customer as both the initial payment and the final payment are subtracted from the value of the car before calculating the monthly payments that the customer has to make. Customers who do not want a big payment to be scheduled for the future can remove this future outgo by spreading out the payments to be a little higher but equal and simple. For those who need a car with a low monthly payment, the former option is just right. The financial designs that have been introduced into car leasing has a plan for every customer, in tune with what they have in their minds.
If the customer is thinking of the long term value of the money from the perspective of the future value of the car, the plan that is structured for resolving such dilemnas is Personal Contract Hire. Here the accent is all on the value of the car and not at all on the acquisition. The finance provider makes a determination of what the car would be worth three years down the line, and provides the car to the customer for the payment of this depreciation between current and future value. All that is being paid for is the value that is being lost with time. The customer can remove this factor from their minds. It is a matter on most people’s minds when they consider forking out amounts that are close to £25,000 whether continuous value can be derived from the investment or whether it is an investment that just winds down to negligible value.
When we make investments in equities, we have the chance to derive income continuously while the base value stays the same and might even appreciate.
Such a strategy can be applied to an investment in automobiles by taking out a contract based only on the forecasted movement in the valuation. A car from an established manufacturer could hold its value at almost the same levels at which it has been purchased. This can make for a low payment for the customer as the value holds firm. The win-win in such a model is that the customer can take the best automobiles at the high end of the market for the lowest monthly payments. The condition that is imposed in this model of leasing is that the customer has to be very easy on the mileage so that the vehicle holds its values. A vehicle that has done a very high amount of mileage will not be attractive for prospective buyers in the future. The model is based on an extensive appraisal of the market.