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What is a threshold?

Most lease companies will have a threshold of between £50 and £100 with some as high as £500. If the cost of damage on your car is less than this figure, then chances are they won't charge you. For any car that they need to make recharges on, it has to be assessed, the charges reviewed, bills made up and sent out, and money collected. In other words, it costs them money to do all this and it's just not worth their while chasing people for pennies.

Obviously, this threshold can work to your advantage if you know what the figure is and have a matrix of charges for damage. You can repair just enough damage to bring you under the threshold and avoid the rest of the charges. The flip side of this is that if you know what the threshold is you can avoid paying for repairs that you wouldn't have been charged for. The more you know, the more you can benefit. For example, if you know which repairs are likely to be cheap compared to the cost of recharge, you can get these done, leaving more expensive repairs so that they are covered by the threshold.

But one thing that we must make clear, the threshold is NOT 'money off'. If the threshold is £150 and the damage on your car comes to £155... don't think they are only going to bill you for £5. They will bill you for the full amount of £155. Nor is it an entitlement, it is just a function of their billing system -- most lease companies are open about what their threshold is but others are reluctant to tell, and it is at their discretion as to how it's applied.

The threshold is not only applicable to wear and tear, anything that is chargeable such as missing items and excess mileage will have an effect.

Our advice is to phone your lease company and start asking question. Ask which wear and tear standard they work to, ask for a matrix of charges, and ask what the threshold is. The next stage is to honestly and accurately assess the condition of your car... it would be a complete waste of time for you to have repairs done in order to bring you under the threshold only to find you have been charged because they spotted a dent or scratch that you did not -- you need to be as diligent as they will be.

Never be afraid to call your lease company... they aren't there to catch you out, if fact they would love to help you to in any endeavours to raise the condition of your car before return, if you can get it under the threshold, that will be just fine with them! Don't imagine they will be sitting there taking notes on any damage you will be asking about - they won't!

 

De-Fleet Services

Our End-of-Lease Services provide quality repair for excessive wear and tear, and is acceptable and appropriate for Contract Hire, Personal Contract Purchase (PCP), Private Lease, Contract Purchase and Lease Purchase. Fleet managers wishing to efficiently prepare off-lease vehicles can contact us or send their drivers directly to our Q&A. Our advisors are trianed by Manheim to work to the BVRLA guidelines.

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This page was last updated on Wed, 12 October, 2011
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