Planning to Lease a Car? How To Go About it and Mistakes to Avoid

Planning to Lease a Car? How To Go About it and Mistakes to Avoid

Hey there! Want to lease a car? Don’t know or where to start? If you answered yes to these questions, you definitely have to continue reading.

Leasing a car is a great way of getting a car when you don’t want to buy one. You’re typically borrowing the car for a monthly payment amount, and you’d have to return the car when the contract with your dealer ends. This is particularly beneficial to people who want a new car at an affordable rate. On, there are various reviews from different people on opinions about leasing a car.

To make it a lot easier, follow these steps to lease a car.

1.   Work with your budget

It’s really not that hard to lease a car, but before you do, you should really ask yourself what kind of car you want to lease and if you have the ability to take care of the car. This is because the payments for different kinds of cars vary and you may have to pay more if you damage the car. So, work with your budget.

2.   Understand how a car lease works

Car leases limit the number of miles you can drive. This number of miles is added to your odometer. If you exceed the number of miles agreed upon, it attracts a fee. This mileage also influences the depreciation and hence the residual value. The residual value is an estimated value of the car’s worth at the end of the contract. Thus, the higher the mileage, the higher the residual value. You will also have to pay interest and taxes.

3.   Look for dealers

You’ll need to check out a few dealers and take some cars on a test drive to access the cars. This will help in choosing cars.

4.   Price negotiation

The sales price, also known as the capitalized cost, is the amount of money you’re paying for the car. You can negotiate this to suit your budget. After negotiating and estimating the price, you can now proceed to lease the car.

5.   Maintenance after leasing

This is important as you have to take good care of the vehicle in your possession.

Mistakes to Avoid When Leasing a Car

·        Underestimating mileage

 You should understand how many miles you normally cover on long trips so you can estimate your mileage limit accordingly. Although more mileage will increase depreciation, exceeding the mileage limit will increase the amount you pay at the end of each month.

·        Not buying insurance

Guaranteed asset protection (gap) insurance is essential. This insurance covers the difference between what you owe on your lease and the actual value of the car. This insurance is also of great help when you need to buy the car at the end of the lease – if you would love to do that.

·        Paying a lot of money upfront

This is particularly of a great disadvantage if your car gets damaged or stolen. If you’ve already paid so much upfront, your money would not be refunded back to you. You’d lose your car and your money.

·        Poor car maintenance

If you don’t give proper care and maintenance to your car or you don’t follow the stipulated guidelines, you’ll be charged more fees at the end of the contract.

·        Lengthy car lease periods

If you have plans to lease a car for a long period of time, then you should probably consider buying the car. This way, you won’t have to worry about the monthly lease payment.

Leasing a car is quite affordable and convenient for people who need a car but do not want to purchase it. By following the steps above, you are on your way to doing it right.