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What to know about leasing a car?

From the lens Car Leasing Center.

Have a question, a story to share or some advice on car leasing, don't be shy let the rest of us in on it!

If it is a question, quite often that same question is on the mind of others as well. If it is a story it will certainly help others who stop by in either avoiding a pitfall or becoming more aware!

If we have met or exceeded your expectations, please tell your friends. Our goal is to help people avoid expensive pitfalls when it comes to car leasing and buying in general. Don't forget, please rate us!

  • TTMall Mar 15, 2012 @ 4:55 pm | delete
    Great lens subject! Thanks for sharing!
  • Chris Feb 28, 2012 @ 10:46 am | delete
    Good read. Very valid points raised. Theres definately pros and cons for car leasing. Car Leasing Made Simple
  • Phil Feb 8, 2012 @ 4:05 pm | delete
    if I am at the end of a lease and the value is higher than the buyout, how do i use the value as a negotiating advantage towards purchase or a new lease of another of the same ( new year) vehicle?
  • dryder Feb 8, 2012 @ 4:57 pm | delete
    Hi Phil!

    First off, thank you for posting your question ... I appreciate the opportunity to pass on the information and chances are there are a few others with the same thought!

    Ok, let's get to it then ...

    If you have found that the value of your current leased venicle is higher than the buyout, then of course you have two options, you can:

    1. Still give the keys back, walk away into another vehicle, or
    2. Buy the vehicle out at the residual value, plus taxes, licensing, safety and e-test.

    If the value of the vehicle is higher than the residual at the end, unfortunately, you are not able to use it as a negotiating tool. The beauty of a lease is that you have the two options. If it doesn't hold value you, you give it back. If it holds or is higher, then of course you have the option to buy it and then decide on keeping it, or buy it and flip it.

    I know, not necessarily the answer you want to hear and I get where you are coming from, but, keep in mind that when you lease you do not own the car, it still belongs to the manufacturer.

    What tools did you use to determine that the value is higher than the buyout? Did someone at the dealership appraise it for you?
  • sarahrk Jan 8, 2012 @ 7:06 pm | delete
    Good advice, I wish I read this before leasing.
  • jamesanderson1346 Apr 1, 2009 @ 2:52 pm | delete
    Nice lens. i give your lens 5**. Read
    Finance Articles
  • Dennise_Ryder Dec 8, 2008 @ 12:40 pm | delete
    Hi Misty ... and thank you for stopping by and adding your views on leasing!

    I have come across many people who have said "no way, I am not leasing ever again, I was burned the first time." Leasing can be a viable option, the thing is that you as the customer have to understand what you are responsible and the sales person has to explain everything properly to you and in detail. As long as that communication process is in place and you understand what it is all about there is no reason for getting burned or having bad experiences.

    The two things you NEED to be aware of are:

    1. kms - making sure you understand what your km allowance is for the term of the lease.

    2. damages - knowing that if you don't take any sort of added protection that you are on the hook for the damages.

    If those things are explained to you clearly and if your sales person keeps in touch so that you have no worries throughout the term of your lease, there is no reason to "get burned."
  • mistyblue75605 Dec 5, 2008 @ 9:14 am | delete
    I personally have had bad experiences with leasing...when you finance at least you will own it when it is over leasing you will only have paid to end up paying alot more if you want to own it! But great lens!
  • Dennise_Ryder Sep 6, 2008 @ 8:25 am | delete
    Ahhh, the $64,000 question! Actually the rates have come down since the Dodge Journey first arrived ... so it is coming down. The demand for the Journey has been huge!

    With respect to your question about rates, keep in mind at the end of the day, you aren't buying a rate, you are buying a vehicle that is going to meet your needs and fit within your lifestyle. So many people get hung up on interest rates, but at the end of the day I could show you 0% interest where your payment would be much higher than an interest rate of 6.99% with incentives where your payment would be considerably lower.

    If you think I am blowing smoke here, email me and I will send you a quote both ways and you can see for yourself!!
  • Allan Sep 6, 2008 @ 8:07 am | delete
    Will the rates for the Dodge Journey ever go down?
  • Dennise_Ryder Sep 6, 2008 @ 8:03 am | delete
    Thank you for the question! Unfortunately you can't switch back and forth between financing and leasing. The only time you can go from leasing your car to financing is once the lease term is over and you have decided to buyout the car. If or when you decide to do this then you can decide to finance the balance of the buyout. Depending on the manufacturer you may be able to finance the remaining balance at a lower finance rate. Chrysler Canada offers "preferred financing rates" to customers who want to finance their buyout on selected models.
  • Michelle Sep 6, 2008 @ 6:56 am | delete
    Can change my mind and finance my car instead of leasing it?
  • hearthealth Jul 2, 2008 @ 9:54 pm | delete
    With so many economic headaches going on, leasing a car certainly helps to save up! 5*
  • Dennise_Ryder May 30, 2008 @ 5:01 am | delete
    Beth!

    Thank you for stopping by and good luck with the application! If I could give you a couple of tips it would be: be straight forward, be YOURSELF and have fun doing it!

    Good luck and if you need an ear ... I am here!
  • ms-giggles May 29, 2008 @ 5:16 pm | delete
    Hi, I'm so glad I stumble by your lens!! I really need a job and tomorrow I'm putting my application in to sell cars. I've been in the food service for over 35 years and no nothing about selling cars. Just a little scary!!!!
    I need all the education I can get!!! Thanks for educating me on buying and leasing.
    5***** to your lens.
    Cheers Beth
  • Dennise_Ryder May 28, 2008 @ 5:08 am | delete
    Hi Peter ...

    Leasing applies to new cars and is a way for a person no to take the hit on depreciation. As for older cars, if you purchase used because of the interest rates being different (bank rates) you are far better off to finance or cash purchase. The payments to lease wouldn't be beneficial, too high.

    Thanks for posting and come on back!!
  • petergrizzly May 27, 2008 @ 3:21 am | delete
    As I understand it, this applies only to relatively new cars (I mean, cars not more than 20 years), right? Cars 20 years old and older may appreciate in value, so could owning it be much better?

    Thanks for this very informative lens. 5 stars!

    -Peter G
    Co-owner,
    Classic Cars for Sale
  • CleanFace May 17, 2008 @ 9:15 am | delete
    Nice lens! 5 stars given! :)
  • LouVozza May 4, 2008 @ 6:39 am | delete
    I generally lease my cars because I like to get a new one every three years. I just think that after 3 or four years that start to break down a little more.

    To me the most important thing though is that a car does not represent equity. It's value depreciates over time and a good part of that is in the first couple of years.

    All in al it makes more sense for me to lease.

    Great lens, by the way. 5 stars!
  • yuma Apr 23, 2008 @ 10:13 am | delete
    Fantastic lens! Loads of info squashed onto one page. Good stuff.
  • ElizabethJeanAllen Apr 21, 2008 @ 5:19 pm | delete
    I've never leased a car. When we buy a car, we drive it until it goes to that junkyard in the sky. As we get older, I'm not so sure I want to keep doing that. Old cars tend to break down at the worst possible time.
    Liz
    The Weekend Reader
  • Dennise_Ryder Apr 9, 2008 @ 5:24 am | delete
    Writertiff!

    Thank for taking the time to ask a question!

    A balloon payment is like a lease with a few differences. Your monthly payments will tend to be a bit lower than they would be if you were to finance, BUT, the sum at the end of the term you are totally responsible for, you don't have the option to walk away like a traditional lease.

    If you are the kind of person where you want smaller monthly payments but want to OWN your car at the end, then a balloon payment "may" be the way to go.

    You really need to do your due diligence and make sure you have all your options before you. Ask for a payment based on a traditional lease, finance, and a balloon payment and see which one fits your budget!
  • writertiff Apr 8, 2008 @ 6:30 am | delete
    I leased to own my first car but paid cash for my second. Can you explain balloon payments to me? I'm nervous about paying a lump sum at the end.

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dryder

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