Keith Hawes, Director at Nationwide Vehicle Contracts: said:“Many customers assume they can continue their contract on an informal basis at the end of their agreement, but some finance providers don’t allow this.
“If you fail to return the vehicle at the end of the contract, the finance provider has the right to request the return of the vehicle at any point and, in some cases, will collect the vehicle without notice and issue any incurred costs directly to the customer”.
Many customers opt to keep hold of their lease vehicle beyond the contract end date to ensure they aren’t left without transport while waiting for delivery of a new car, yet in doing so, could be in breach of contract.
They are then shocked to receive a warning notification from the finance provider asking them to return the vehicle. If the finance provider fails to hear back from the customer, it can arrange for the vehicle to be repossessed without notice and if necessary, issue costs of £350 onwards to the customer.
If customers wish to keep their vehicle for a longer period, they must apply for a formal extension which allows the customer to extend the lease contract for an additional term, usually of six or 12 months.
Nationwide Vehicle Contracts advises that customers don’t leave it until the last minute to extend their contract as failure to act in time could put them at risk of being left without a vehicle.
Hawes said: “Each finance provider has different rules, so it’s important you check what is permitted before you make a decision.
“Some funders won’t allow you to formally extend if you’re in the final weeks of your contract, so we always advise customers to ensure they contact us in enough time to ensure they aren’t left stranded without a vehicle”