Personal Leasing is a a form of long-term hire - effectively you rent the car without
ever taking ownership of it.
The lease period is usually a number of months or years during which the car is still
owned by the leasing company. Effectively you are borrowing the car from the supplier
for a fixed period in return for the lease rental payments.
During the lease period you pay a monthly rental to the leasing company which covers
the costs incurred by the leasing company to operate the vehicle. These are typically:
At the end of the lease period you return the car to the leasing company. The leasing
company then disposes of the car.
Because the car is leased, the normal responsibilities of ownerhip, such as sourcing
the best deal and obtaining the best resale (or 'residual') value are avoided, as
is the risk of the residual value being less than expected.
If you terminated the lease earlier than expected then you may be required to pay
a penalty (usually a number of months rentals).