Usually, people who lease a vehicle do so as they can drive a newer car for less cost than the cost involved when buying a car. However, it is important to ensure that the fine print is read before lessees sign a contract. Also, you need to find reputable leasing companies like Andy1st driving school. To avoid problems when leasing a car, here are some common mistakes to avoid.
New cars are advertised by dealers with low monthly lease payments. However, consumers are often asked to spend a lot of money at the start of the term in order to obtain rock-bottom payment. In general, that money serves as an advance initial payment of the lease. But this payment would become a problem should the vehicle be stolen or get wrecked in the first few months of the lease term. If this will happen, the leasing company would be reimbursed by the insurance company for the car`s value; however, the money you paid in advance would not be refunded. Because of this, it is recommended that you shouldn`t pay over $2,000 in advance. In fact, it makes a lot of sense not to make any down payment.
Ignoring Gap Insurance
The new car`s value decreases after it has been used many time and this holds true with leased cars. When a leased vehicle is totaled or stolen and the insurance provider pays for the value of the vehicle, such amount is likely not to cover your total obligation under the lease`s terms. In this case, gap insurance saves you from getting out of pocket. At the start of any car lease, you need to ask if the lease contract includes such gap insurance coverage. If this is not included, you can find a car that has a lease plan which does.
Underestimating the Driven Miles
A lot of leasing companies can advertise low monthly fees as they set low mileage limits. Usually, leasing contracts have 12,000 miles to 15,000 miles per year of driving maximum. When you exceed these limits, you could be asked to pay an additional 18 cents to 25 cents per mile as the lease ends. To avoid this, you need to know the leasing company`s driving habits before you sign the contract. If you tend to drive more miles than what the agreement allows, ask the company for a higher limit. But of course, this could mean higher monthly lease payment.
Failing to Maintain the Leased Car
When the leased car is damaged which is beyond ordinary wear and tear, you could be charged with extra fees as you return the car to the dealer. In general, if a vehicle has a scratch with marks less than the size of a business card, a lot of leasing companies consider this as a normal use. Thus, the company may not charge you a penalty.
When the car has damage, you have to fix it using your own money before you return it. Otherwise, the damage`s value will be assessed by the leasing company. When it comes to normal wear, a leasing company`s definition may differ and you should not assume that you deal with a lenient lease company. It is then important to ask about the lease-end-condition guidelines before you get the car.
Author Bio: David Hart spent many years running a car leasing company. He is happy to provide tips on matters related to car leasing. Also, he gives advice on how to find reputed leasing companies like Andy1st driving school.