How to Choose a Lease Vehicle
Auto leasing has faded considerably since 1999, when leasing made up roughly 40 percent of new car sales, according to Bankrate.com; however, leasing is making a strong comeback. Leasing allows you to walk away from your vehicle at lease end, and leasing usually incurs lower monthly payments than a purchase.
A savvy auto leaser knows what to look for in an auto lease--and how to choose a good lease vehicle. If you are inexperienced in auto leasing, you'll need to become familiar with the important parts of choosing a lease vehicle.
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Instructions
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Determine the type of vehicle you want. While leasing a vehicle that doesn't suit your wants and needs won't hurt you as bad as purchasing one, you'll still have to live with it for at least a couple of years.
Consider the reliability rating. Check a vehicle's reliability ratings by using resources such as Consumer Reports and Edmunds.com. Most leases run concurrent with the manufacturer's warranty; it's unlikely you'll have out-of-pocket repair expenses during the lease, but constant breakdowns and trips to the dealer are inconvenient, nonetheless.
Choosing a reliable vehicle will increase the chances of your lease being a pleasant experience.
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Consider the available specials and your payment budget. Visit the dealership selling the vehicle you are interested in to inquire about leasing specials. You can also determine an approximate monthly payment on the vehicle in which you are interested.
Leasing specials are determined by the residual value and the money factor. The residual value in a lease is the estimated value at lease end; since you're only paying for depreciation, an increased residual can save you money. The money factor in a lease is similar to the interest rate in a normal auto loan. Special money-factor rates will save you money.
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Read the fine print carefully. Don't get suckered into a lease that's not right for you. All manufacturers have flexible terms and mileage plans; choosing a lease vehicle with an unfavorable term or a mileage plan that doesn't suit your driving needs could cost you in the end.
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Negotiate the terms of the lease. A lease, just like a purchase, is negotiable. While the dealer cannot control the residual value, they can control the cap-cost. When the residual value is deducted from the cap-cost, the figure equals the amount of money you'll pay for the lease, before taxes and interest.
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Tips & Warnings
Keep your lease vehicle in excellent condition. All auto leases have provisions that hold you responsible--and charge you--for excess wear and tear. If the manufacturer receives the vehicle at lease end in sub-par condition, they'll usually send you the reconditioning bill.
