With such a great range of models to choose from, it’s easy to find the perfect van for you at Mercedes-Benz South West. But how do you want to pay for it? With so many van finance options available, you’ll probably have a few questions. That’s why we’ve put together these van finance FAQs so you can make your decision with confidence.
What van finance options are available?
We have five different van finance plans available to help you find the perfect fit. That includes:
- Agility (PCP) – This flexible method of finance runs for a fixed amount of time. As you’re only funding a proportion of the van’s value, it usually requires a lower deposit and lower monthly payments. You can then choose what to do at the end of your agreement.
- Hire Purchase – This is an affordable route to ownership that allows you to spread the overall cost over a fixed term. You can pay a deposit that suits you and choose the length of your agreement.
- Operating Lease – This van finance solution allows you to drive one of our vehicles for a fixed term and with lower monthly payments without the commitment of ownership. You then hand back the vehicle at the end of your agreement.
- Contract Hire – Pay an advance rental at the start of your agreement and repay only part of the vehicle’s value to keep your monthly rentals low. Your payments also cover the cost of Vehicle Excise Duty. Your van will be collected from you at the end of your agreement.
- Finance Lease – You hire your van for a fixed amount of time without owning it, but it still shows as an asset on your balance sheet so deductions can be made from taxable profits. When the agreement ends, you can choose to extend it, sell the vehicle or return it to us and we’ll sell it for you (you’ll receive 95% of the proceeds).
What is a balloon payment?
With our Hire Purchase and Finance Lease plans, you’ll see that there is an option to make a balloon payment at the end of your agreement. A balloon payment is a one-off payment you can make if you want to own the van after the agreement ends. It is equal to the predicted residual value of your van based on the age of the vehicle and its mileage.
Can I pay for my van in cash?
Of course. Pay in cash and you’ll own the van outright from the moment you get the keys.
Can I get van finance if I have bad credit?
All of our van finance agreements, whether with private or business customers, will be subject to a credit check. To pass the credit check, you’ll typically need:
- UK residency
- A UK driving licence
- Three years of address history
- Proof of income
- No current CCJs or mortgage arrears
If you’re a business customer, then we’ll also ask to see proof of positive trading.
Can I get van finance if I’m a sole trader or run a new business?
Yes. Being a sole trader or running a new business will not prevent you from getting van finance as long as you pass a credit check.
Can I get van finance if I’m not VAT registered?
Not being VAT registered will not affect your eligibility for van finance. However, you won’t receive the same tax benefits that you would if you were registered.
How much deposit do I have to pay?
That depends on the van finance plan you choose and how you want to structure it. With most of our finance options, you can choose how much you’d like to put down as a deposit. Generally speaking, the larger the deposit, the lower your monthly instalments will be.
How long will the finance agreement last?
Our terms range from two to five years depending on the van finance plan you choose. Flexibility is built into all of our plans to help you find a deal that suits you.
What happens if I exceed the mileage restrictions?
Mileage restrictions may apply depending on the finance plan you choose. Check the second page of your finance agreement for details of the excess mileage for your vehicle. If you exceed the mileage restrictions, then there will be an excess mileage fee to pay at the end of the agreement. You can email email@example.com for a copy of your finance agreement.
What happens when my agreement ends?
Whichever finance plan you choose, we will be there to support you throughout. Around six months from the end of your agreement, one of our Customer Loyalty Specialists will be in touch to discuss your next steps with you. That will include a free market appraisal, a calculation of the equity in your van and the future costs you may need to consider with whatever option you choose. This appointment is completely free of charge.
Can I return my van before the agreed date?
Yes. If your van finance plan is an Operating Lease, Contract Hire or Agility agreement, then you can arrange to change your hand back date. Please call customer services on 03301 730 280 or email firstname.lastname@example.org to discuss your circumstances with our team.
How do I apply for van finance?
Whichever plan you’re considering, you can get the ball rolling today. Explore our range of Mercedes-Benz approved used vans or book a test drive with our team. We will talk you through your options, answer any more van finance FAQs you may have and help you find a van finance plan that suits you.