Thinking of leasing a new car and pondering these questions? Should I lease or buy, which is best for me? How does leasing work? What am I paying for when I lease? What elements can and can’t I negotiate? Unlike a traditional car loan, leasing is a type of financing where you pay for the use of a vehicle instead of the purchase of a vehicle. Leasing a car verse buying a car is a major decision and you should know some basic information, before making that big decision! Below is some basic information on leasing a car.
1. Always review the lease offers in your area. Manufacturer-backed ones may be your best bet especially if you are someone who does not enjoy negotiating. However like in all lease subjects, review the details carefully. Especially, the bit on down payment.
2. In case you are going in for negotiations, always remember each auto lease has three parts – what is negotiable, what is non-negotiable and what may be negotiable depending on various factors.
Negotiable: The Capital Cost is negotiable. This is basically nothing but the vehicle’s selling price. So negotiate like you are buying and ensure that its set at or below the average price that other buyers pay for similar cars in the market. Trade in Value: This kicks in if you are trading in a car for a new lease car. Again, this is negotiable too. Money Factor: This is the interest rate on a lease. Expressed as a decimal number, this depends quite a lot on your credit score. Dealers may mark it up for additional profit purposes. In such situations, ask them for a lease based on their “buy rate”!
Article Source: Lynch Chrysler.