Generally speaking, vehicle leasing is the rental of a car, truck, SUV, minivan, sports car, or electric car for a fixed time period. Automotive dealerships offer vehicle leasing as an alternative to traditional auto financing or purchase. It is often utilized by businesses when acquiring business vehicles. In general, leasing a car costs less than buying a car, although there are several restrictions, such as vehicle mileage limits and non-customization agreements, that can determine whether it is better to lease or buy a vehicle.
Let’s examine our ten most commonly asked questions regarding vehicle leasing.
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Leasing or Buying a Car – Which is Better?
The short answer to this question is: ‘it depends’. If you drive a lot of miles annual and like to keep your vehicles for longer than three years, leasing won’t be very beneficial for you. However, if you like getting a new car, truck, or SUV 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. Basically, 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 causes a significant reduction at resale, but with leasing, it’s already taken in to 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.
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Car Leasing – Is It a Good Idea?
The benefits of leasing a car are unique. You cannot get them with other auto financing offers. Benefits like lower payments, maintenance provisions, and avoiding having to trade-in or sell your old vehicle. Foreven more details on the benefits of auto leasing, our car finance department is standing by to answer all of your questions.
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How Much Does Car Leasing Cost?
Many manufacturers and dealerships offer zero-down lease offers. Like any financial product there are varying factors that qualify or disqualify customers from these types of leases. Factors such as credit payment history, credit scores, etc. Just remember that paying zero down typically means greater monthly payments. Car leasing, like traditional auto financing, works like this: the bigger the down payment, the lower the monthly payment.
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Can You Lease a Used Car?
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.
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Can You Purchase The Car You Are Leasing?
The majority of auto leasing contracts have buy-out clauses in them in the event that you fall in love with your vehicle and would like to buy it. Please note that the purchase price of the car may vary. This depends on the residual value of the vehicle when the lease agreement has expired. There are options to purchase your leased car prior to the completion of the contract. For this, however, you must speak with a leasing representative. Only they can provide this exact info and take care of any early termination fees that may apply.
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Can One Get a Deposit Back On Car Leasing?
Typically a deposit is refundable at the conclusion of the lease. At least this is true when all leasing contract specifications have been met. Keep in mind that a deposit (a.k.a. a security deposit) is not the exact 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. Therefore, read your lease agreement carefully and ask as many questions as you have before you sign on the dotted line.
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Can You Lease A Car With Bad Credit & No Money Down?
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.
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What Credit Score Do I Need To Lease a Car?
Generally speaking, credit score of 619 or lower is classified as “subprime”. While a subprime borrower won’t typically be automatically declined, a credit score lower than 619 means you will likely have to pay a higher interest rate and/or down payment. Luckily, there are a lot of steps you can take to improve your credit score like employment history, multiple loan requests, and consistent on-time payments.
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May I Return My Lease Vehicle to a Different Dealership?
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 Kia into any authorized Kia dealership across the nation. Again, assuming all your lease contract obligations have been fulfilled.
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Is Maintenance Included With My Car Lease?
One of the more popular benefits of leasing a car is the maintenance provisions available in most lease agreements. Of course, specifics will vary within individual lease contracts, but most leases will cover your leased vehicle’s normal maintenance and service needs. These include fluid and filter changes, regular tune-ups, and regularly scheduled maintenance typically doesn’t cost anything out of pocket.
Do you have more questions about our current promotions, vehicle lease offers, or related topics? Then contact us today. Our team of leasing specialists are waiting to respond to all your questions.
