Leasing Tricks at the Dealer

When auto-leasing, people often get told so much information that is worded just for them, that they wind up paying out through the nose, after having depended on the dealers "help", doing so without ever looking over all the options.

Here are a few ways dealers often leave their customer paying hundreds of dollars more than their vehicle is valued, since they make more profits at it.

Way 1: Leasing makes better sense than buying

"Drive a new car every 2 years without the big payment", is what many dealers claim. You may have to spend a little more on insurance, have miles limits, and have to be a little more careful with it, "but you can handle that right?", is the blow off many buyers find themselves agreeing to, when signing on the straight line at the end of the last page, after initialing a bunch of items, often agreeing to longer terms to lower the payment even more.

2-4 years later, it's time to turn the vehicle in, it's got its problems, extra miles, and they want more money. This is the experience many have. On the other hand, those that figure always to have a payment can stick with the miles and keep it in fair condition, the lower payment and more expense on insurance may be worth it. These people are few and far between.

Way 2: You get a better interest rate on the lease

Lease rates aren't the same as interest rates. They calculate considerably different than loan interest rates. Lease Money factor, down payment, term and miles are considered in the lease amounts. It's a whole different calculation. Consider Way 1 and think again, "Will you want to be making a payment forever?"

Way 3: Easy early way out of the lease

While in some cases, leases do have clauses for early termination, in the long run it costs you even more money, and it will undoubtedly leave you at least some mark on your credit rating. Overall, you still have a long-term contract, and if they let you out of it, they get paid for it and profit better faster. This is actually possible in a purchase as well; just sell it and payoff the loan. It isn't that simple on a lease, though also possible.

In the End: Rather than finding yourself in a mess, it's better to take your time, look at all options, and weigh it all out. Do you always want to be in a payment? Do you always want a new vehicle (from the start again) every 2-4 years? Can you afford the additional insurance coverage required by the leasing company? Do you like not owning something in the end? These are just a few questions to consider when looking at lease –vs- buying. Ask many questions, and find what you definitely want to do with the answers you find.