Leasing an automobile is like renting it for an extended period of time. Leasing allows an individual to have a new car with little or no down payment at the time of purchase and a smaller monthly payment.
Definition
A car lease is when an individual makes monthly payments on a vehicle but those payments do not go towards owning the car. The lessee is only paying for the depreciation on the vehicle plus vehicle charges.
Benefits
Individuals who like owning a new car every few years or those wanting a lower monthly payment benefit from a car lease.
Payments
A person should negotiate with the dealer for the lowest possible price on a leased vehicle, as well as check for any rebates or incentives, since this will affect the monthly payment on the lease.
Mileage
Lease contracts specifically outline the number of miles a lessee can drive the vehicle. Most often it is limited to 12,000 to 15,000 miles a year. Going over the allotted mileage will result in costly fees when the car is returned to the dealer.
Care
Maintaining the vehicle is crucial when leasing. It is the responsibility of the lessee to keep the car in good condition both mechanically and in appearance. The lessee will be responsible for the costs to repair the car when she turns the car back in to the dealer.
Length
An automobile lease is normally two to five years in length.
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