Understanding Auto Leasing

Auto Leasing is a fuzzy topic for most people and is often greeted with hesitance and unease. Why is this? We believe it is because people are uneducated about what leasing really is. It is scary to try something new, especially when it involves the sum of money necessary to take home a brand new car. But the truth is leasing has a number of benefits that outweigh buying; it all depends on the type of person you are and what you’re looking for.

One common misconception associated with leasing is that it is similar to renting. This is not the case. 80 year old women will take a rented car drag racing if they’ve purchased the extra insurance, but you wouldn’t do that with your leased vehicle. Why you ask; because you are liable for what happens to your leased vehicle. In that respect, there is no difference between leasing and owning. If you water pump goes out or you get into an accident and your bumper is dented, it is your responsibility to fix it. If not, you will be slapped with a fee for excessive wear and tear.

Another misunderstanding people have with leasing is that it is more expensive than buying. This is definitely not the case. One of the biggest lures of leasing is the price. Leasing is one way you can get into a car you would have never been able to afford. Always wanted to drive a Corvette? When you lease, because of the smaller payments, you can drive away in that car. However, like purchasing, you will usually be required to pay a down payment, and occasionally, your first month’s payment upfront.

How it works

There are three main ways you can go about leasing a car. The first is through an online leaser like Autoflex. They offer a free lease quote which is essentially a small for you send to them with your contact information and the type of car you’re interested in. They will usually respond by phone at which time they’ll quote you a generic price. After that they’ll ask what you want the car to look like, paint color, interior, gizmos, gadgets, etc. They’ll then search their data base, find your car, and quote that exact price to you. After everyone has signed on the dotted line, they will ship the car and park it in your driveway.

You can also use an online middle man company like Automotive. They also do a free lease quote, but when you fill out the information it goes out to a number of dealerships in your area that have that car. The dealership will then contact you and you’ll have to work stuff out with them. This has its ups and downs. The down side is that you have to work with a dealership, go down there, sign the paper work and all that jazz. The plus side is that you can see the actual car before you lease it. The third way is to simply forget the Web, go down to your local dealership and start asking questions.

The Difference

In many respects, leasing is similar to buying. You are responsible for what happens to the car, you must make monthly payments, and you will be fined for paying late. The main difference, of course, is that you do not own the car. This point is often met with skepticisms, but we are unsure why. Yes it is true, many people would like to own their car, but there are plenty who could care less about owning their car.

Let’s say you buy a car; you will have to make payments for many years. In that time, who’s to say you won’t decide to buy a new car. If you did that every 10 years, chances are you’ll always have a car payment. Similarly, when you lease, you’ll always have a car payment, but they will be much less. Also, you’ll get to be in a brand new car every few years.