How To Lease A Car - Six Great Tips For Success

How To Lease A Car - Six Great Tips For Success It is important to know how to lease a car before negotiating the terms. Knowing how to lease a car will give you a huge advantage over any potential lessee.

Especially if your finances are not ideal, a lease deal could be one of the best options.

However, there are several important factors that need to be considered.

Six Great Tips For Success

Tip One: Be realistic about what you can and cannot afford. Determine how much money you can put down, and how much money you plan on spending monthly. Try to test drive different vehicles to determine the make and model that you would like to lease.

If you are trading in an existing car, be sure to get its retail value and calculate how much money you will need to pay off your car lease balance. As a lessor, it is crucial

that you work closely with a reputable dealer to determine the selling price of the leased car so you know whether or not to offer a lower price to satisfy the lessee.

Tip Two: Negotiate the purchase price, but remember to include all the fees and charges.

Before you sign any paperwork, check the details to see exactly what the automobile leasing company will be responsible for and any additional fees Some of these charges may include a disposition fee, which you should always negotiate for. Negotiating the disposition fee is often the deciding factor when it comes to determining how much the car lease will cost you.

Tip Three: Look for three years lease options. Most automobile leasing contracts stipulate a minimum of three years for the lease term.

If possible, consider choosing three years leases for the same amount of monthly payments you have to make each month. Three years leases have lower monthly payments and longer lease terms, making them a better deal in most cases.

Tip Three: Negotiate for an acquisition fee. This is billed as a non-refundable charge at the end of the lease term. Generally, the acquisition fee is equal to ten percent of your down payment.

However, this depends on the model, mileage, and condition of the leased vehicle, so it is recommended that you negotiate if you are not comfortable with the acquisition fee.

Tip Four: If you want a more affordable monthly payment, consider leasing a used car. Even though you might not be getting the lowest rate available, you will probably save money compared to buying a new car.

Also, leasing is more affordable compared to financing through a dealership. Keep in mind that most dealerships also add on finance charges and other fees, so it can

actually be cheaper to lease a car instead of buying it through the dealer's financing program. So ask them about leasing options and costs before you lease a car.

Tip Five: Find out the dealer's finance and leasing policies. In general, dealerships charge you a higher interest rate than a private lender or other financial institution, because they always have to take on more risk with their financing programs.

However, a dealer's interest rate is tied to the market value of the vehicle you are trying to finance, which is why it is important to compare interest rates among dealerships to find the lowest rate possible. You should also take note of any special dealer financing rates, such as the manufacturer's interest rate or the dealer's rate on over-the-road vehicles.

Tip Six: Calculate your monthly payment using the dealer's money factor. The money factor is the amount of your vehicle costs less to insure over the life of the lease or the total cost to purchase.

Calculating this money factor is simple. Buy the lowest priced car you can physically afford. subtract your down payment to that price (plus whatever you paid for a security deposit) to get your starting point. Then multiply your starting point by the dealer's money factor to get your final price.