What is Car Leasing – Frequently Asked Auto Lease Questions
What is Vehicle Leasing? How Does Leasing a Car Work?
Do you want to know what is vehicle leasing? or how does leasing a car work, then you’re in good company. Not everyone is familiar with all the pros and cons of leasing a car. In fact, there are many auto leasing alternatives available.
Generally speaking, vehicle leasing is the rental of a car, truck, SUV, minivan, sports car, or electric car for a fixed period of time. Auto dealers offer vehicle leasing as an alternative to traditional auto financing or purchase. It is often used by businesses when acquiring business vehicles. In general, leasing costs less than buying a car, although there are several restrictions, such as vehicle mileage limits and customization agreements, that can determine whether it is better to buy or lease a car.
Let’s examine our ten most frequently asked questions regarding auto leasing.
Is It A Good Idea to Lease a Car?
Is It Better to Lease or Buy a Car?
What Does It Cost to Lease a Car?
Can You Lease a Used Car?
Can One Buy the Lease Car?
Do You Get Your Deposit Back On Car Leasing?
Can You Lease A Car With Bad Credit & No Money Down?
What Credit Score Do I Need To Lease a Car?
Is Maintenance Included With My Car Lease?
May I Return My Lease Vehicle to a Different Dealership?
There are many benefits of leasing a car that you just can’t get with other auto financing offers. These benefits include maintenance provisions, not needing to trade-in or sell an old vehicle, and lower payments. For even more details on the benefits of leasing, our vehicle finance department is waiting to answer all of your questions.
Deciding whether to lease or buy depends on many factors. If you drive a lot of miles annual and like to keep your vehicles for longer than three years, leasing won’t be very beneficial for you. However, if you look forward to getting a new car, truck, or SUV every two to three years and have no interest in the trade-in/selling process of your current vehicle, you could be a prime candidate for an automotive lease. Basically, the difference between auto leasing or buying really comes down to your personal, automotive and financial priorities.
Also, it is worth mentioning that some owners find high mileage leasing to be more beneficial in terms of financial safety and security than vehicle ownership. Statistically speaking, despite the overage fees you may pay when returning a high mileage leased vehicle, it is likely that you will come out ahead, compared to buying a car. High mileage causes a significant reduction at resale, but with leasing, it’s already taken in to consideration. Additionally, the more time you spend on the roads, the more susceptible to accidents you will be. Therefore, if or when that accident occurs on your own vehicle, you would receive wreck history on CarFax, as well as a resale/trade-in deduction for vehicle damage. With leasing, you are not responsible for the deduction in value from that accident.
Most dealerships and manufacturers offer zero-down lease offers. Of course, there are varying factors that qualify or disqualify individuals from these kinds of leases. Factors like credit scores, credit payment history, etc. Just don’t forget that paying zero down typically means bigger monthly payments. Auto leasing, like traditional auto financing, works like this: the bigger the down payment, the lower the monthly payment.
Yes, you can lease a used car. This type of ‘used car leasing’ is a little known ‘secret’ among car dealers but most do offer Certified Pre-Owned leasing specials on CPO vehicles less than four (4) years old and with fewer than 48,000 miles on the odometer.
The majority of auto leasing contracts have buy-out clauses in them in the event that you fall in love with your vehicle and decide to finance it. Keep in mind the purchase price of the vehicle may vary. This depends on the residual value of the vehicle after the lease agreement has expired. There are also options to purchase your leased car prior to the completion of the contract. For this, however, you will need to speak with a financing manager. Only they can provide these buy-out details and take care of any early termination fees that may apply.
Generally a deposit is refundable at the end of the lease. At least this is true when all leasing contract obligations have been met. Keep in mind that a deposit (a.k.a. a security deposit) is not the same thing as a down payment. Down payments are not refundable but security deposits typically are. Also note that some leases require non-refundable deposits. Therefore, read your lease agreement diligently and ask as many questions as you have before you sign on the dotted line.
While it is not impossible, it is difficult to lease a vehicle if you have a poor credit rating and no money for a down payment. Most zero-down lease offers require a healthy credit rating. But don’t worry, there are plenty of options available for car shoppers with less-than-stellar credit scores. To explore your leasing options, simply contact our financing team.
Generally speaking, credit score lower than 619 is classified as “subprime”. While a subprime borrower won’t typically be automatically declined, a credit score lower than 619 means you will likely have to pay a higher interest rate and/or down payment. Luckily, there are various steps you can utilize to improve your credit score such as employment history, multiple loan requests, and consistent on-time payments.
Of all the benefits of leasing a car, maintenance benefits are typically the most popular. Of course, specifics may vary within individual lease contracts, but most leases will cover normal wear-and-tear service and maintenance needs for your leased vehicle. These include filter and fluid changes, normal tune-ups, and regularly scheduled maintenance typically do not cost the lessee anything out of pocket.
Typically speaking, yes, you can trade in your leased vehicle at a different dealership. It must, however, be an authorized dealership for the vehicle manufacturer. It’s probably obvious, but you can’t turn a leased car into any other brand of dealership. You can, however, turn your leased Nissan into any authorized Nissan dealership across the nation. Again, assuming all your lease contract obligations have been fulfilled.
Ask About Our Auto Leasing Offers TodayDo you have more questions about vehicle leasing or our current offers? Then contact us today. Our team of leasing specialists are on hand to respond to all your questions.
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What is Car Leasing – Frequently Asked Auto Lease Questions | Town North Nissan