Benefits of Leasing a Car/Truck
By leasing a new vehicle, many shoppers are able to get more car for less money. The car monthly payments are typically lower because you’re only paying for the future depreciation of that vehicle, and not the actual sales price. With a car lease, you only pay a percentage of that.
The car’s predicted future value is what it is expected to be worth at the end of the lease, which is its residual value. The residual value is subtracted from the purchase price and whatnots left over is what you make payments on. So if the car’s residual value is 55 percent after three years.
Many car leases require several thousand dollars up front, though the down payment is negotiable. Many advertised lease offers will promote low payments, but require a sizeable down payment. If you want to put as little down as possible, remember that your monthly lease payments will be higher.
Many leases last about three years, which is typically the length of many new-car bumper-to-bumper warranties. As a result, the car is usually covered under warranty for repairs for the duration of the lease. You still need to maintain the car, though, which includes oil changes, tire rotations and recommended maintenance from the manufacturer. Failure to properly maintain the car during the lease can result in fees when you turn the car in at the end of the lease.
If you enjoy having the newest high-tech features, leasing could be better for you. Since you’d be leasing every few years, each new car you lease will have the latest and greatest technology and safety features. If you’ve fallen in love with your leased car and want to keep it, you can generally buy it at the end of the lease by paying cash or by taking out a car loan to finance the balance.
Disadvantage of Leasing a Car/Truck
Lease contracts limit the number of miles you can drive. These mileage restrictions typically are 9,000, 12,000 and 15,000 miles a year. You need to estimate how many miles you drive per year so you can determine how many miles to purchase. If you go over that amount, you’ll pay a fee per mile at the end of the lease when you turn the car in. These overage charges can be very expensive.
With leasing, you can sometimes make minor alterations to the vehicle that can be reversed before you turn the car back in, but you generally can’t make any major alterations. Make sure you read the lease contract carefully before signing.
Another drawback is that when you lease, you’re really just renting the car for a few years and paying interest to finance that car over a specified period of time. The lessor (lender who owns the car and is leasing it to you) earns money off the interest you’re paying. Dealers sell cars coming off lease as used cars or certified pre-owned cars. Because leased cars have strict rules about mileage and maintenance, they’re typically in very good condition at the end of the lease.
Unfortunately, you don’t get anything for all the hard work you put in to the car to maintain it and keep its mileage low. Since you’re basically renting the car when you lease, you’re not building any equity. This is similar to renting an apartment versus buying a condo or house. Another potential downside to leasing is that usually only shoppers with good credit scores will qualify for a car lease.
Hera come the credit factor, For leasing they expect to have perfect credit standing. If your credit score is less than perfect, you may want to consider buying a used car or waiting to lease until you can clean your credit up and increase your credit score.You always check your credit please go to home this site.
I have a friend who was a Medical Doctor, and his wife also practicing physician, they leases car each year. For them money is not an issue, and they can use tax benefits of leasing a Car.