How much should my lease payment be?

We’re going to be honest, leasing can be pretty confusing, especially if you have never leased before. And one of the more confusing elements of leasing is the pricing.

This is because there is so much that determines the price of a lease contract, that every lease contract is essentially bespoke to that individual. So how do you know how much your lease payment is supposed to be?

In this article, we look at everything you need to know about lease pricing including how its determined, what affects it, and how much your lease payment should be.

What determines lease price?

As I mentioned, there are so many things that affect lease price. So much so, that we don’t put prices on our website, the price can vary that much person to person. But what sort of things determine lease price?

  • Your deposit
    • The more you put down initially the lower your monthly payments will be
  • The type of car you are leasing
  • How long your contract is
    • Sometimes a longer contract will equate to lower monthly payments
  • Annual mileage
    • The higher your mileage, the higher your monthly payments will be
  • Your credit rating
  • The residual value of the car
  • Additional features you want on the car
  • Your choice of supplier
  • The type of lease contract
  • When you order your car

[vc_single_image image=”44641″ img_size=”article-image”]So you can understand why we don’t put prices on our website! These are all things that can affect the price of your lease car, some of these can greatly affect it, and others not so much. But they are things that you should be thinking about when looking at your budget.

Where can I find out the price of a lease?

The best way to get an accurate lease price would be to ring a salesperson. They will ask you a few questions and will give you the most accurate price for your situation.

There will be leasing companies that will have their prices on their website. So you can use these as a guide to how much your lease contract could be. It’s also good to compare it with other lease companies.

How is lease price calculated?

Lease prices are calculated differently depending on which lease contract you have. It’s important to note this before you decide which lease price is best for you.

How is contract hire price calculated?

The price of a contract hire lease is calculated by the residual value of the car, the purchase price, the length of the contract and the annual mileage. The residual value is how much the car will be at the end of the contract. The higher the residual value, the lower the monthly payments.

Generally, a contract hire is calculated by the following;

(purchase price – estimated residual value)/months on contract and annual mileage + admin fee = monthly payments

With contract hire, you are only paying for how much the car depreciates over the course of your contract, which is why cars with high residual value have lower monthly payments.

How is finance lease calculated?

[vc_single_image image=”44642″ img_size=”article-image”]The price of a finance lease is calculated by taking the;

  • Overall cost of the van
  • Length of your contract
  • The end payment


The end payment, or the balloon payment, is set by you and is more of a sensible suggestion of a final rental (plus interest charges).

How can I lower the lease price?

There are ways that you can lower your lease price. These include things such as;

  • Getting a  longer contract
    • The amount you pay over the course of your contract stays the same, so if you lengthen your contract then the payments may be lower.
  • Put down  more as a deposit
    • Again, the amount you pay over your contract stays the same. So, if you put down more initially, you’ll lower your monthly payments.
  • Lower your mileage
    • A lower mileage means lower monthly payments. It might even be worth simply paying the excess mileage charge. You can find out more here.
  • Just being flexible
    • You can find some great deals if you’re more flexible with your requirements.

[vc_single_image image=”44645″ img_size=”article-image”]

Are some lease contracts cheaper than others?

While there are lots of different things that affect lease price, there are some contracts that are cheaper than others.

For example, contract hire is generally cheaper than contract purchase. This is because contract hire doesn’t have any interest, and contract purchase has interest with APR. So, if you don’t want to own the car at the end, it might be worth you looking at a contract hire.

And, there are times where business leasing is cheaper than leasing privately. This is for a variety of reasons that you can read about here.

How do I know I’m getting a good price?

So, how do you even know if you’re getting a good deal? If it was me, I would get a few quotes and compare them. But, don’t shop around too much because you run the risk of shopping yourself out of the market.

Ultimately, though, if you have the amount you want to spend and you know your requirements, then you can make your own decision as to whether you are getting the best deal.


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