The retail value of automobiles is at an overall steady increase. However, the cost of leasing a car is less than the price of buying a car. Therefore, a car lease is the smarter choice for many car shoppers who want to drive a specific car model at a price they can afford.
Because a car lease only lasts several years, people can drive a late model without a huge risk of encountering expensive repairs. If a leased car needs a repair, the repair is covered under the manufacturer’s warranty. This means drivers can spend less time at the mechanic’s and save the money that they would otherwise spend on repairs.
What Does Leasing a Car in Involve?
Anyone who is considering leasing a car should know a few essential pieces of information. The most significant details are described below.
Your Payments Reflect the Car’s Value.
The automobile’s sales price directly determines how much the lessee will pay. Consumers who are on a tight budget should look at car models with lower retail values.
Higher Residual Percent Saves You Money.
The monthly lease payments include the difference between the car’s value at the beginning of the lease and its value at the end of the lease to account for depreciation. In other words, the lessee must pay for the car’s value he uses during the lease term. The higher the vehicle’s residual value percentage, the lower the lessee’s monthly payments.
Understand Your Set Miles.
Every lease agreement specifies the number of miles per month the lessee is allowed to drive. If the lessee exceeds the mileage limit, he must pay a fee for each mile driven past the limit. Before entering into a car lease, consumers should be clear about the number of miles they can drive every month as well as the price of excess mileage charges.
Expect a Disposition Fee.
Although the monthly payments for a car lease are manageable, there are additional costs to leasing a car. At the end of the lease term, many people are required to pay a disposition fee when the car is returned. Typically, a disposition fee costs anywhere from $300 to $500.
Understand What Money Factor Means.
The money factor for a car lease is equivalent to an annual percentage rate for a financed car. A consumer-friendly lease will have a low money factor because a low money factor means paying less in monthly payments.
Is it Better to Lease or Buy a Car?
Memphis car leases can be an excellent choice for the cost-conscious consumer. However, in order to make the right decision for their specific circumstances, consumers need know the difference between buying and leasing an automobile. Zooomr stands firm in the principle of understanding the paperwork before signing the agreement.
You Won’t Own the Car
When someone purchases a car, he is free to sell or customize the car even while making monthly payments. On the other hand, when a person leases a car, he is only paying to drive the car; the lender still owns the car. Even though Memphis car leases cost less per month than car purchases, the lessee cannot sell or alter the car.
Leasing Cuts Down Up-Front Costs
Most people who finance a car must pay or use a trade-in as a down payment. However, a down payment is not required with Memphis car leases. To lease a car, lessees need to pay the first monthly payment, an acquisition fee, a security deposit, taxes and other fees. People who want to have a lower monthly payment can pay more money at signing, but putting additional money toward the lease is optional.
No Need to Worry About Selling Car Leases
It is a hassle to sell a used car. Buyers can be tough negotiators, trying to get the best car for the lowest price. To get a favorable price, sellers should keep their car properly maintained and the mileage low. With a car lease, lessees do not have to concern themselves with finding a willing buyer or determining the automobile’s resale value.
The end payment of a financed car purchase means that the buyer owns the car. After making the final payment, the lien holder gives the buyer the car’s title, and the buyer is free to keep or sell the car. However, when the lease term ends, the car’s ownership does not revert to the lessee. Instead, he must return the car unless he opts to buy it.