Leasing a car is considerably an appealing approach to “owning” a car for convenient traveling when needed. Even though vehicle leasing processes are not overly complicated, you may make some decisions that may ruin the chances of benefiting from the lease. Luckily, the tips discussed below will help you get the most bang for your buck. Always pay attention to them if you want to get the most from your lease:
1. Negotiate where you can
When leasing a vehicle, you should try to get the best deal, by negotiating where possible. This is in consideration that some factors such as residual value and over mileage fees might not be negotiable when leasing a car.
You should, however, feel free to negotiate the following vehicle leasing fees:
• Documentation fee
• Capitalized cost
• Buyout price (the amount you can buy the car for at the end of the lease period)
• Money factor
Getting the best deal when leasing a car is all about negotiating the initial purchase price as much as you can.
2. Pay attention to the residual value
The value of the car after the lease period is up is referred to as the residual value. But why should you be interested in the car’s worth after you’re done with it? Well, the answer to this one is pretty direct. The more value a car retains throughout the lease period, the less you are going to pay. As such, you should do your best to get a good estimate of the residual value to determine whether you have a good deal.
3. Consider the money factor
As far as leasing is concerned, “money factor” is a word used in place of “interest”. It can also be referred to as the “lease fee”, or “lease factor”. The most important factor of the money factor is the APR (Annual Percentage Rate). The money factor can be determined after dividing the APR by 2,400.
As expected, a lower APR and money factor are better since that means a lower financing rate. A lower money factor can also lower the monthly payment significantly. Therefore, it’s important to know the number before making any leasing deal. You can make use of leasing websites and other external sources to determine what the best money factor in the marketplace is at that time.
4. Know how many miles you drive
The miles you drive are important as they can affect lease payment amounts. You should try your best to get a rough estimate of how much you expect to drive during the lease period before heading to a dealership. If you expect to drive a lot during that period, you should buy the mileage upfront.
If you’re ready to dive into vehicle leasing, you should consider using the tips discussed in this article to get the best deal. Since leasing is not for everyone, do thorough research before making a decision. If, however, you are interested in having a new vehicle for a specified period with fixed ownership costs, leasing is the way to go.