Are you looking for answers about what is car leasing? or how does leasing a car work, then you’re in good hands. Not everyone is familiar with all the benefits of leasing a car. There are, in fact, many auto leasing alternatives available these days.
In the most basic terms, vehicle leasing is the rental of a car for a fixed time period. Automotive dealerships offer vehicle leasing as another option to traditional auto financing or purchase. It is often used by businesses when acquiring a company vehicle. In general, leasing costs less than buying, although there are several restrictions, such as mileage limits and non-customization agreements, that can determine whether it is better to lease or buy a car.
Today we are going to look at our ten most commonly asked questions regarding auto leasing.
Deciding whether to lease or buy depends on many factors. Do you drive a lot of miles annually? Do you like to keep your vehicle for a long time? If so, then car leasing might not be your best option. However, if you enjoy getting a new car every two to three years and have no interest in the trade-in/selling process of your current vehicle, you could be a prime candidate for an automotive lease. Essentially, the difference between auto leasing or buying really comes down to your financial, automotive, and personal priorities.
Also, it is worth mentioning that some owners find high mileage leasing to be more beneficial in terms of financial safety and security than vehicle ownership. Statistically speaking, despite the overage fees you may pay when returning a high mileage leased vehicle, it is likely that you will come out ahead, compared to buying a car. High mileage impacts resale value, but with leasing, it’s already taken into consideration. Additionally, the more time you spend on the roads, the more susceptible to accidents you will be. Therefore, if or when that accident occurs on your own vehicle, you would receive wreck history on CarFax, as well as a resale/trade-in deduction for vehicle damage. With leasing, you are not responsible for the deduction in value from that accident.
There are many benefits of leasing a car that you just can’t get with other auto financing offers. Benefits like lower payments, maintenance provisions, and avoiding having to trade-in or sell your old vehicle. For more details on the benefits of auto leasing, our auto finance department is on hand to answer all of your questions.
Most dealerships and manufacturers offer zero-down lease offers. Like any financial product, there are varying factors that qualify or disqualify individuals from these kinds of leases. Factors such as credit payment history, credit scores, etc. Just keep in mind that paying zero down typically means higher monthly payments. Auto leasing, like traditional auto financing, works like this: the more you put down, the less you pay monthly
Yes, you actually can lease a used car. This type of ‘used car leasing’ is a little known ‘secret’ among auto dealership but most dealers do offer Certified Pre-Owned leasing specials on CPO vehicles less than four (4) years old and with less than 48,000 miles on the odometer.
Generally, a lease deposit is refundable at the conclusion of a lease. This assumes that all the leasing contract obligations have been met. Keep in mind that a deposit (a.k.a. a security deposit) is not the same thing as a down payment. A down payment is not refundable but security deposits typically are. It is important to note some leases require non-refundable deposits. Be sure to read your lease agreement diligently and ask as many questions as you have before you sign on the dotted line.
The majority of auto leasing contracts have buy-out clauses in them in case you fall in love with your car and decide to purchase it. Keep in mind the purchase price of the vehicle may vary. This depends on the vehicle’s residual value when the lease agreement has expired. There are also options to purchase your leased vehicle prior to the completion of the contract. For this, however, you will need to speak with a leasing representative. Only they can provide these buy-out details and take care of any early termination fees that may apply.
Typically, a credit score lower than 619 is classified as “subprime”. While this type of credit won’t typically be automatically declined, a credit score lower than 619 means you will typically have to pay a higher interest rate and/or down payment. There are many steps you can take to improve your credit score such as apply for too many loans, employment history, and consistent on-time payments.
While it is not impossible, it is difficult to lease a vehicle if you have a poor credit rating and no money for a down payment. Most zero-down lease offers require a healthy credit rating. But don’t worry, there are plenty of options available for car shoppers with less-than-stellar credit scores. To explore your leasing options, simply contact our financing team.
Typically speaking, yes, you can trade in your leased vehicle at a different dealership. It must, however, be an authorized dealership for the vehicle manufacturer. It’s probably obvious, but you can’t turn a leased car into any other brand of dealership. You can, however, turn your leased Acura into any authorized Acura dealership across the nation. Again, assuming all your lease contract obligations have been fulfilled.
Of all the benefits of leasing a car, maintenance benefits are typically the most popular. Specifics will vary within specific lease contracts, but almost all leases will cover your leased vehicle’s normal maintenance and service needs. These include filter and fluid changes, regular tune-ups, and regularly scheduled maintenance typically do not cost the lessee anything out of pocket.
Do you have more questions about vehicle leasing, current promotions, or related topics? Then contact us today. Our team of highly knowledgeable car leasing agents are waiting to respond to all your questions.
Vehicle Leasing 101 – Top Ten Car Lease FAQs | Sterling McCall Acura
How to Get Approved for Car Leasing | Sterling McCall Acura