The Do’s and Don’ts of Leasing a Car
With over 1.3 million estimated car and van leases taking place across the United Kingdom in 2017, car leasing has never been so popular. It’s extremely important, however, that you know the ins-and-outs of how to truly make the most of leasing a car.
DO Negotiate the Lease Price
As opposed to car loans, leases for cars don’t actually come from the banks and instead come through the car manufacturers. This, therefore, means that people have the opportunity to negotiate the price.
When coming up with a lease price, there are three things that are calculated and thereafter taken into consideration: Finance Fee, Depreciation Fee and Sales Tax. A finance fee is the interest the finance company charges for lending money. The sales tax, on the other hand, is the VAT that is charged on the actual purchase and, finally, the deprecation fee is the expected loss in the value of the vehicle of the lease itself – the part of leasing that generates the highest percentage of the costing of it.
It all, ultimately, comes down to the cost of the car and that is the opportunity that leasing allows for you to negotiate – the capitalized cost.
DO Lease early in the Model Year
Due to the fact that the aforementioned deprecation fee tends to be the highest cost when choosing to lease a car, you should really aim to lease cars which are likely to retain their value over a long period of time. It is therefore of the utmost importance to act as quickly as you can and lease the car pretty soon after it comes out in order to risk a higher deprecation fee. Whether you’re looking to lease an Audi or any car for that matter, it is important that you attempt to lease soon after its release.
DO Get Insured Up
In the unfortunate event that your leased car is subject to damage – i.e stole or having problems through an accident, GAP insurance is an asset protection insurance type that will protect you and your lease. It is usually a minuscule price, but a major help should you need it.
DONT Terminate Your Lease Earlier than Contracted
This is perhaps the worst thing you can do when leasing a car. Before leasing a car, make sure you can commit and follow the lease through! It’s pretty much the same as any rental contract, it’s a mutually beneficial agreement and if you do not hold up your end of the bargain then you will be hit with big charges.
DON’T Pimp Your Ride
However tempting it may be to make your car your own and put some gold on your wheels, avoid adding too many accessories. This is because companies that deal with leasing have a limit on the retail value for each model of the car, and if you put the latest sound system into your car, it’s very likely you will only get use out of it for a year or two before someone else gets it.