People who lease vehicles do so because leasing allows them to drive a better and more expensive car for less money that it would cost to buy one. However, many people make the mistake of not reading vital details before making a decision. These errors that people make when setting up car leases can cost them a lot of money.
Paying too much money upfront
Price is always negotiable all the time. The MSRP for a leased vehicle is just a suggestion, just like it would be if you were going to purchase a car outright. The best thing is to negotiate with a sales person is the best move to lower the required monthly payment significantly.
Another trick used by car dealers is where these dealers advertise low monthly lease payments on new autos, then ask consumers to pay several thousand dollars at the beginning of the term to get the low fees.
Forgetting gap insurance
The value of a car drops significantly after it is driven. If a leased car is stolen or totalled and the car insurance makes a payment for the value of the car, this sum may not cover the consumer’s total obligation under the terms of the lease. The driver would in most cases have to pay the balance out of their pocket unless they have gap insurance. At the beginning of the car lease, ask if the contract entails this specialty gap insurance coverage.
Underestimating miles you’ve driven
Most of the today’s leasing companies can advertise small payments because they have low mileage limits. Leasing contracts usually come with a driving maximum, say 10,000 miles to 15,000 miles per year. If consumers exceed those limits, they are charges a certain fee, say an additional 10 cent – 30 cents per mile at the end of the lease. When it is time to return the car, you could end up paying a lot for extra miles used. Be in the know!