What is a leasing contract and what does it include?
A leasing contract is a formal and legally binding document that outlines the terms and conditions under which a lessor (the leasing company or leasing bank) grants a lessee (the customer) the use of a car. It does not transfer ownership of the car.
The leasing contract specifies various critical details, including:
- The duration of the lease: How long will the lease last? Most contracts stipulate a duration between 24 to 60 months.
- The mileage allowance: How many kilometres is the customer allowed to drive the car? This can range anywhere between 10,000km to 30,000km per year.
- The monthly rates: How much will the customer pay the leasing company on a monthly basis as compensation for the use of the car? This is dependant on the car’s residual value, the applied interest rate, and the initial down payment.
- Early termination conditions: Are there penalty fees or will the customer need to pay compensation if they decide to terminate the contract earlier than is agreed in the contract?
- The residual value: How much will the car be worth at the end of the leasing contract? This amount is fixed in the contract and is a prognosis.
It is vital that the customer carefully reads the leasing contract before signing it in order to be aware of the financial commitment they are entering. Terminating the contract early can result in high payments.
In order to better prepare the customer for the signing of the customer and offer them complete transparency, draft contracts can be generated for every car on offer on gowago.ch by beginning a non-binding leasing application.
Furthermore, gowago.ch offers customers to comfortably sign their contract digitally. This service is offered in cooperation with Intrum AG.