Car Leases: How to Avoid the Extra Costs Associated With Them
Buying or leasing a new car can be a costly endeavor, which is why it is so important to understand your rights as a consumer and to get help from a Sacramento lemon law firm if you have serious problems with your vehicle.
While it is always expensive to buy a car or to lease a car, there are ways that you can try to keep leasing costs down. CNBC recently provided some helpful tips on how you can avoid some of the extra costs that may come with auto leases.
Avoiding Extra Costs That Come with Car Leases
CNBC advises that leases account for around a third of all new vehicle transactions, which is an increase from 2009 when just 20 percent of new cars were leased. While monthly payments on a lease are around $120 lower than the monthly payments on traditional car loans, leases can come with surprise costs that some borrowers are not aware of.
Lease costs are typically based on the expected depreciation, or the amount that the car is expected to drop in value during the time when you have the lease. Choosing a car that tends to hold its value more could potentially help you to keep lease costs down, compared with other vehicle models. CNBC also indicates that you can typically negotiate with the dealer on the residual value, or the projected value of the car at the end of the lease, in order to try to reduce the costs of the lease and the payments that you owe.
Having good credit can also help you to qualify for the best financing deals on a lease. And keeping your lease relatively short – to around three years – should mean that the car is typically under warranty for the entire duration of the time you are driving the vehicle so you do not end up having to pay for costly repairs on a leased car.
You'll also need to consider how many miles you tend to drive, as it can be very expensive to put more miles on the vehicle than you are allowed to drive under the terms of the lease. CNBC indicates you will typically pay around 15 cents to 25 cents for each mile you go over the limit on the lease. This means if you are over by 1,000 miles on the car, you'd pay between $150 and $200 when you turn in the vehicle at the end of the lease. It can be much less expensive to negotiate a lease that allows you more miles at the beginning than it is to pay the mileage fee at the end of the lease.
While being smart about leasing or buying a car up front can help save you money, it is also important to know your rights if something goes wrong. A Sacramento lemon law firm can provide assistance if you have a problem with your vehicle and want help exercising your consumer rights. Contact an attorney as soon as a problem arises so you can get the assistance you need to protect your investment.