New registrations, first registered, pre-registered - Which lease vehicle should you choose?
Sometimes new vehicles are not exactly new... Dealerships and manufacturers will pre-register a selection of new cars before they are sold or leased to customers. So why do dealerships/manufacturers pre-register cars?
In our industry, leasing has grown around a number of bulk/commitment deals where a finance company has committed directly to a manufacturer that it will purchase (to offer on a contract hire basis) a number of vehicles – this commitment could range between 50 – 500 vehicles at any one time. The finance company will use a number of credit brokers, like CarLease UK, to advertise and sell these vehicles to their customer database. Based on our sales acumen and customer database, we do so on their behalf (and at very competitive prices). At the point the vehicles are registered, the finance company will pay the manufacturer for the vehicles – for the finance company this means enhanced discounts and for the manufacturer this provides cash flow and certainty of sale. For a leasing customer, this can mean a cheap offer.
When a vehicle is registered, the dealership essentially provides the details to the DVLA to confirm that the vehicle is live. This used to happen via the automated first registration and licensing service (AFRL) but has now been replaced by the “register a vehicle service”, which is meant to be a quicker and simpler cloud solution.
When a vehicle goes live, this starts two very crucial clocks ticking:
1. The date for an MOT – this test checks that the vehicle meets the road safety and environmental standards. The MOT check is due on the third anniversary of the vehicle’s registration; and
2. The date for a warranty – a manufacturer warranty will last for 3, 4, 5 or 7 years depending on the manufacturer. This is something which covers any defects or faults which arise by no fault of the customer. This does not cover servicing, maintenance and tyres. Indeed you must ensure you maintain the car correctly in order to preserve a warranty.
Most leasing brokers and finance companies will state that a vehicle is pre-registered and, where available on their website, the date of registration. Because our industry focuses on new cars, many of the vehicles we offer will be no more than 3 months’ old in most situations (they can be a little older in exceptional cases). At the point you receive an official quote or official order, you should be informed something along the lines of “please note – this is a pre-registered vehicle. The car was registered in August 2018 on an 18’ plate”. This is more than sufficient to bring this to a customer’s attention and make it clear that this is not a brand-new/un-registered car.
To confirm, a pre-registered leasing deal is nothing to be alarmed about. The crucial point is that you are told about the vehicle status in advance of ordering it. If you go for this type of deal it is likely you will be getting a great deal; while the car may be 1-3 months old, you will be getting an incredible discount and your monthly rental will be very competitive. However, if this is not suitable, you are well within your rights to refuse this deal and instead go for a brand-new car. However, do note that you may pay quite an enhanced premium for doing so.
Learn more about leasing in our help and advice page or be sure to contact a member of our leasing team to discuss pre-registered leasing. You can also check out our blog pages for ideas, inspiration and reviews of some of the latest lease cars on offer here @CarLease UK
CarLease (UK) Ltd t/a CarLease UK, Car-E-Lease UK and VanLease UK is Authorised and Regulated by the Financial
Conduct Authority – our Firm Reference Number (FRN) is 706617.
CarLease (UK) Ltd t/a, CarLease UK, Car-E-Lease UK and VanLease UK is a credit broker and are not a lender. We work alongside a limited number of finance providers who may make payment to us if you enter into an agreement with them. Failure to maintain rentals may result in the vehicle being withdrawn (this may affect your credit).
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