08.02.06
Posted in General Leasing, Car Leasing, Buying versus Leasing, Financing, Auto lease swap, Car lease swap at 4:48 pm by LeasingRus
All auto leasing individuals should know that leasing a new car gives you a lower monthly payment than buying that car.
But buyer beware: Make sure you know about all the fees you might have to pay at the end of the lease, that’s if you opt to ride out to the end of your auto lease, or decide to auto lease swap.
Some consumers would be shocked at what they would have to pay if they turned in their auto lease to the dealer or leasing company early - known as auto lease termination. Even though you may have taken good car of the vehicle, returning a car lease early can be a costly experience. As outlined in all lease agreements, the disposition fee can be costly, and doesn’t cover any of the wear and tear you place on your vehicle throughout your lease term. The wear and tear fees alone can run past triple the amount of your disposition fee, and can be quite a sticker shock. This may include any dents, cracked windshields or dings, scratches, etc. So while you think the disposition fee on your auto lease was pricey, ensure you understand what the additional costs would be on the wear and tear.
Do your research a year or two before the end of the auto lease, as you may find an option to break your car lease through an auto lease swap; whereby finding another consumer to transfer the auto lease too and will assume the lease payments and contract.
Whlie auto leasing has its advantages over buying a car, ensure you understand fully the costs associated to the lease agreement upon returning the vehicle. FInd out what you’ll be charged for returning the auto lease early, and at the end of the lease when you terminate the auto lease. Find out the additional costs on wear and tear if you can, or what’s considered normal wear and tear on the vehicle.
Remember, before you opt to auto lease as your preferred form of financing that vehicle, ensure you understand the full scope of the pros and cons of leasing. Download the two ebooks available to consumers to help you make a better and informed descision. 1. 2006 Auto Leasing for Consumers and 2. Auto Lease Swap - How to Get Out of an Auto Lease Early
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05.15.06
Posted in Articles, Buying versus Leasing, Car lease assumption at 6:04 pm by LeasingRus
Is it time to buy your car lease? Did you know 3.1 million car leases expire this year (2002)? If you are part of that group The Early Show’s personal financial adviser Ray Martin says now is the time to buy out your lease. They don’t want to talk about it, but car dealers are desperate to unload these vehicles, which means that great bargains abound. The alternative is to break your lease early and transfer the auto lease to another consumer seeking to take over the lease. You have options!The math of leasing a car is pretty simple. The carmaker guesses how much the car will be worth once the lease ends. This value is called the “residual” value. (You and I know it as the used car value; it’s the price that a leaser can purchase the vehicle for at the lease end, the “buy out price.”) Once the carmaker sets a residual price, the dealer who is leasing to the customer sets the monthly payment amount. This amount is based on the difference between the car’s selling price and its estimated residual value - the smaller the difference, the smaller the monthly payment.
Many customers love auto leasing because it allows them to drive a car they may not have been able to afford otherwise. As it turns out, however, leasing has not benefited automakers.
According to CNW Marketing Research, automakers lost an estimated $10 billion last year in the U.S. from lower-than expected residuals. Another group reports that last year, leasing companies lost an average of $2,914 on every car returned to them. That’s up from $2,550 in 2000.
Even if a car leasing company did not inflate the residual value, it is still being forced to take losses now because the value of used cars has dropped. Here is why: Auto makers managed to make leasing a popular option - leased cars comprised roughly 4 percent of sales in 1980 and over 30 percent by 1999. As leasers returned their vehicles to dealers, they created a glut of barely-used cars. This supply drove down the price. Thus, a 1998 Toyota 4-Runner whose buy-out price was set at $26,500 was only worth $23,000 last June.
The glut promises to continue as 3.1 million leases end this year, rental car companies pare back their fleets and drivers who binged on no-interest new car deals trade in their cars.
Also remember that when banks and finance companies take back a car at lease end, they typically sell it at a wholesale auction. At auction, dealers pay below retail prices, the companies incur a time delay in receiving the money and they must pay costly auction commissions. So, for many reasons, leasing companies would prefer that you buy out your lease or at least transfer the lease to someone else who is willing to take over the lease and buy it out.
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05.02.06
Posted in Buying versus Leasing at 6:48 pm by LeasingRus
We’ve heard it time and again and a common question consumers ponder when they get into the market to seek out a new ride. Should I lease a car or buy a car? What option is financially best for me? Well, remember, whether you lease a car or buy a car, there are options in the end to transfer your car lease, or sell your car. Transferring a car lease entails finding someone to trade a car lease too, or simply put, another way of how to get out of a car lease and transfer the lease to another consumer.
Buying a car then wanting to sell it - well, this is an option we’re all familiar with. However, the latter concept of getting out of a car lease is somewhat new and a popular alternative to those who lease a car. Here’s what you need to know before leasing or buying a car (Yahoo):
Car Shopping Checklist
Mileage Statement
- Has the mileage of your trade-in been entered?
- Are all the blanks filled out?
New Vehicle Mileage
- Is the mileage statement on the new car the same as on the odometer?
- Used Vehicle Mileage
- Power of Attorney
- Finance Contracts
Is the VIN number the same on the buyer’s order and finance contract?
- Is the figure for the amount you intend to finance the same on both?
- Are the finance charges the same as you agreed?
- Are there other charges to which you have agreed?
- Check the other fees normally associated with a new car purchase.
- Is the annual percentage rate as agreed?
- Do the amount and number of payments reflect the total number of months you have agreed to pay?
Warranty Agreements
- Have you read the warranty?
- Do you understand what is and what is not covered?
- Are the agreed exceptions in writing?
- Has the warranty been signed by management?
- Did you receive two sets of keys?
- Have you received the owner’s manual and maintenance record books?
- Has the dealership arranged for the license and registration?
- Do you have all registration records?
- Have your arranged for your insurance?
- Is your insurance form in the glove compartment?
So yes, there is quite a bit to think about before signing on the dotted line for your new lease or new purchase. Visit AutoTraderLeaseGuide.com’s education section on car leasing to get a full 101 to 401 overview of the things you need to know about leasing a car (and buying a car) before setting foot into the dealership. The more you know, the more power you have at getting the best deal and discovering which financing option - leasing a car versus buying is for you.
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