Overview on Lease a Car
Some of the best cars on lease have dried up recently, since the automakers began to offer zero-percent and finance in low rate to tempt buyers. Even then leasing remains as the alternative to many motorists who want to buy a new vehicle. Half of the luxury cars come in lease than 20 percent of the vehicles in general.
Most of the customers lease cars every two or three times year which can be expensive even than buying one and payment monthly EMI till final payment. Others are quite satisfied to leasing a vehicle when they cannot afford to buy a car even not saved money.
Leasing has got two basic principles:
- You can have a new car along with a warranty and rarely needs than routine maintenance, and
- Often you can go for a more luxurious and better equipped ones, in car dealership like the leasing the customer fidelity will be three time stronger than buying it.
It is a method of getting a new or a used car which involves paying only a portion of the car rice as different from paying the full amount of car entirely. So in leasing a car you are just paying only for the portion of car for how much period you use according to the lease agreement. That amount of portion is the actually the depreciation amount of the vehicle that suffer during the period of lease.
While used cars also come in lease, but most people leases new cars since it allows the people to get a choose to heavy for their money and not get forced to pay the car value. In the most of the lease range time period is from two to five years, usually this financial expedient get over by 3 years term. Many people today not prefer to buy cars because when you lease cars you get the opportunity to get a new car relatively under warranty which is more reliable while compared to other older cars.
Still there are some drawbacks too in lease cars. After making all the payment in leasing, you remain empty handed without the ownership of car. While certain leasing company’s offer a purchasing option for the leased vehicle by the end of lease but often sometimes the projected outstanding value on your lease agreement is set as stone and you will not get the option to negotiate with the dealer over the price of what exactly a used car cost.
Also you need not to think that way because leasing a car which is free from paying EMI on cost still you are loaned with a bank or lending agency or car manufacture financial division. Here you are paying interest though the amount is hidden in the lease agreement as money factor. This money factor is very small percentage for you but when it comes in understandable terms, just you need to multiply it by 2400 for turning it into a resembling to the annual percentage rate.
When you negotiate in lease agreement, you do not draw over low monthly payment as often it is the money factor that can be saved and is always negotiable. In some lease the rates will be underwritten by removing important elements like the insurance coverage of gap which protect you from any financial liability occur from deprecation on total of your leased new car. So make it sure always that in your lease agreement there is gap insurance coverage written. You must be prepared while negotiating for lease cars. Be sure to ask and just need to be prepared.