Leasing a vehicle is a very tough financial decision to make. There are numerous things that you should keep in mind whenever deciding between leasing and buying. Hence, below is a short and simple guide to leasing vehicles.
Leasing vs buying
Before going to car companies, you should first know the difference between leasing and buying a car. There are a lot of factors that you should consider when deciding between leasing and buying a car. The length of the lease period should be given consideration when making your decision. If you're planning to lease a car for a year, you might want to reassess your situation as extra mileage, and wear and tear fees could probably escalate the cost of the lease, making buying a better option.
Things you need to know before leasing a vehicle
Analysing several lease offers and deciding the best one that fits you can be a very complicated process. There are a lot of things that you should first know before agreeing on lease deals. You must evaluate and re-evaluate your lease in order to get the most out of the deal. Do your own computations on the upfront and monthly payments, the total amount of the lease deal and possible charges at the end of the lease term.
Important car-leasing terms and jargon to remember
Before going to the car dealership/leasing shop, you should first understand some of the basic car-leasing terms and jargon in order to get a good deal with your leased car. Below are some important car-leasing terms and jargon that you should always remember. Acquisition fee - refers to the payment for processing the lease contract. Cap cost - or capitalisation cost is the value of the car that shall be leased. Early termination penalty - is the penalty associated with ending the lease agreement earlier than stipulated. Excess wear and tear penalty - refers to the physical damages suffered by the leased vehicle or improper maintenance during the lease period. Extra mileage fee - car leases often have an extra mileage fee stipulation. Basically, a per-mile amount is charged for extra mileage. Depreciation - refers to the value the car have lost and the potential value it will lose during the lease term.