5 Questions to ask before Leasing a Car
5 questions to ask the Car Leasing Company
- 1. Are their currently any lease specials?
- 2. Do you know the residual car value?
- 3. What’s the money factor or interest rate?
- 4. What is the ammount of mileage include with the lease also deemed as the warranty?
- 5. What fees are included and what are the hidden fees?
Asking the car leasing company on their current specials is important because not only can it save you money it can also prevent you from some of the hoops you may have to jump through because you were knowledgeable on the specials being run. Some of them even offer incentives and rebates. These savings help get cars off the lot faster of course, as well as giving you the option to treat yourself to something fast, loud and exciting of your preference.
Residual Car Value
If you are unfamiliar with this term you are probably asking yourself why this is important? This one factor is important because the higher the residual amount is the lower your payment price can be. This is typically determined by the manufacturer of the vehicle. From this determination of the figure, you are going to be paying the difference between the selling rate offered by the car leasing company and the residual amount over the lifetime of the lease term. You can either pay that off typically by the minimum amount due as discussed by you and the car company or you can decide to pay more to pay the investment off faster.
Always a good question to ask. When you are leasing a car or vehicle knowing and understanding the interest rate are very important factors to understand. If you are familiar with credit cards or any type of banking then you certainly understand that a lower interest rate is always a better option. The higher it is the more you end up paying in the long or short term of the lease. It is still going to be more. Opt for a lower rate to save money. This is almost usually always a negotiable option when it comes to purchasing a vehicle. Shop around. Do not just go with the first one you come across and stand firm when it comes to negotiating the deal. Remember it’s your money.
On a car lease, there is almost always a section that covers the milage included for the lease or the warranty. It’s worded differently from company to company. Keep in mind this to can be negotiated depending on the company. Most companies will include 7,500 to 10,000 and some request a more commonly known minimum of 12,000 miles and a maximum amount of an undetermined number. Personally I feel the minimum standard should be raised to 20,00 miles as this is modern day and people travel a lot. Recently a flying vehicle has come on the market and my question is what are they going to use to determine the minimum mileage for that? Will it be called flying miles as they do planes or something different?
What fees are included in the leasing term? What are the hidden fees that may be briefly mentioned? What fees can you avoid to save money? The most common fee is usually the down payment. That is even more commonly asked before the car buyer decides to move forward on the vehicle selection when they start their search. That is determined by your interest rate, and the special you are receiving from the car company. Also obtaining the knowledge of those small or extra hidden fees is important because well once again that can save you money. Some of the more common hidden fees are well there aren’t any as if they decide not to share that information with you the car company can get in some hefty legal trouble. Drive off fees usually include down payment and any fees discussed with you and the leasing agent who is assisting you in your purchase. Remember the higher amount you put down the lower your monthly payment will end up being. Similar to any traditional loan or credit card explanation.
There are many additional questions you can ask the leasing agent some will come when you are comparing vehicles, others will come to during the buying process. Whatever your question be sure to ask. That one question could determine whether you decide to purchase from that company specifically or go forward with another of your choice. No question is ever stupid either. If you don’t know, ask.
Making the decision on a car or vehicle purchase can be a long process especially when it is a new topic of interest to you. It can be short if you already know what you looking for in a vehicle and you are familiar with the variables on interest rates, companies, and what the vehicle will be driven for along with weather conditions.
Those are great factors to keep in mind too. If you are going to be doing a lot of driving with it you are certainly going to want something fuel-efficient that has a good motor and if it’s used you will want the history on the vehicle to better understand what type of previous wear the motor may have on it.
Make sure to ask about the history of the vehicle regardless of it being used or not. New vehicles still get test-driven, so ask the leasing agent if it has been on any rough test drives or not. That can lead to other issues in the long term of the vehicle life. All in all, have a blast on whatever you decide to test drive before your purchase. Get the best for you on your negotiating. Hard work pays.