Most consumers start a car leasing deal without actually knowing what they are up to. It’s essential to know at least the basics of car leasing phenomenon and its process in order not to get cheated.
The concept of car leasing is really easy and understandable. Car leasing is much like car renting or purchasing and is actually somewhere in between. Leasing itself is a form of financing the purchase of temporary usage of different objects, including industrial equipment, houses, cars etc.
Car leasing has many benefits over purchase, rental and loan deals. Here are some of them;
- No down payment required. Car leasing leaves an option to make no down payment when getting the car.
- Lower monthly payments. Car leasing monthly payments are lower than that of a loan because you are paying only for the portion of vehicle you actually use.
- Return option. At the end of lease term you can buy the vehicle, return it to the dealer or interchange it for another car lease deal. This allows you to change your car every 2-3 years if you wish so.
Of course car leasing has its disadvantages too, among which;
- Contract early termination costs. If you decide to terminate the lease sooner than contract end date you will have to pay much more than expected for the car you actually used for a short period of time.
- No Ownership. In car leasing deals you have little or no rights for the car during the lease term but bear responsibility for its maintenance costs and fees as if it were your own car.
So you should consider all “do”s and “don’t”s of car leasing before making a decision whther it is right for you or not.