What to Expect in a Car Lease
When leasing a car, expect a lower monthly payment than you'd get from a traditional loan. In addition to a lower monthly payment, you should be prepared for an acquisition fee, disposition fee, mileage limitations and a lease-end inspection.
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Acquisition Fee
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The acquisition fee is a bank fee that must be paid to assume possession of a leased vehicle. The acquisition fee may be paid up front or financed over the term of the lease.
Disposition Fee
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The disposition fee is a lease-end fee ranging from $300 to $600 that must be paid at the end of your lease if you do not purchase another vehicle from the manufacturer.
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Mileage Limitations
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A lease will require you to watch your mileage. Leases include mileage restrictions so the lender can project what the leased vehicle will be worth at the end of the term.
Lease-end Inspection
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All leased vehicles must be inspected after they are returned. In some cases, the dealership will inspect the vehicle and inform you of any excess damage. Some manufacturers hire a third-party inspector so the results are impartial. In either case, you may be billed for excess wear and tear.
Expert Insight
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Leasing is a popular way to get an expensive vehicle for a low monthly payment. Before signing the lease, understand that there are major limitations to what you can and cannot do with a leased vehicle.
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