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Leasing: What You Need To Know

The Only Automotive Buying Guide You Will Ever Need

You decided that you want to lease a new vehicle. What comes next? This guide will show you the ins and outs.

Find Out:

  • What it means to lease a vehicle
  • What to keep in mind when leasing
  • What happens when your lease ends
  • What kind of vehicle you can lease

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THE BASICS


WHAT DOES IT MEAN TO LEASE A VEHICLE?

Leasing is when you make monthly payments towards a new or used vehicle for a certain time period instead of purchasing it at full price.


WHAT HAPPENS WHEN YOUR LEASE ENDS?

Once the agreed time period is over you can: walk away, purchase the vehicle, or lease another new vehicle. Speak with your dealer about what they offer!


WHAT KIND OF VEHICLE CAN I LEASE?

Most dealers only lease new vehicles. Check with your dealer, some do offer low monthly purchase payments on used vehicles. Fewer still will offer used vehicle leases.


THE DETAILS

Decided to lease a vehicle? Here are four things to keep in mind:


1. BUDGET:

What is the maximum amount you can afford to pay each month? List out all your monthly expenses to find out. (We hope you’re monitoring your monthly budget already!)

In addition to your monthly payment, you need to plan for expenses at the beginning and end of your lease. Unless waived by the dealer, these can include:

Start of Lease: Down Payment, Tax, Acquisition Fees, DMV Fees, First Payment, Security Deposit, Freight and Destination Charges, Processing Fees, Gap Insurance, Increased Insurance Costs

End of Lease: Mile Overage Fees, Wear and Tear Fees

GAP INSURANCE: Leased car stolen or totaled? This covers the difference between what you owe on your lease and what the car is worth. (We’ll talk more about insurance later).

2. DURATION:

Most leases run from 2-5 years. Are you able to make your payment for the agreed on amount of time?

Will you yearn for a brand new car in a short time? You can terminate your lease early...but that involves a hefty amount of fees. Talk to your dealer about a short-term lease if that’s what you prefer.

3. MAINTENANCE:

Leasing a car means you will have to return it (unless you decide to buy it afterwards). That means keeping the vehicle in top condition so the dealer can sell it as a certified pre-owned vehicle.

Most dealers and manufacturers cover your routine maintenance for at least the first two years. Many dealers will cover you for more! Plus when your car is new, it’s less likely to have the problems an older vehicle would.

CERTIFIED PRE-OWNED VEHICLES: Ever see a dealer advertising pre-owned vehicles as “Certified”? These are nearly new vehicles that have passed rigourous inspection standards set down by the manufacturer. Often these are vehicles lessees have turned in.

4. INSURANCE:

It may not be “your” vehicle but you still need insurance on a leased car. By law, you must have liability coverage plus uninsured and underinsured motorist coverage.

Check your state requirements regarding what coverages are necessary prior to pursuing a lease. Also check what type of insurance is required by the leasing company itself.

How will this affect your budget? The trade-off for leasing a nice, new car for a low payment is that your insurance rates will go up. You should also buy Gap Insurance from your provider. This covers the difference between what you owe on your lease and what the car is worth if your vehicle is stolen or totaled.

Man hand on car hand

THE CONCLUSION:

Now that you have this guide, you’re ready to lease a vehicle. Visit our dealership, get your best deal, and get ready to take on the road in a nicer, newer vehicle.

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