On average there are two types of lease contracts: Open end and Closed End Lease contract. As a buyer, it is critical that you are aware of which type of contract you are signing and the potential risks and benefits of each contract.
Ensuring that you get the best price for your lease
At LeaseMonster our mission to ensure that consumers get the best price for your vehicle. To do this, we have provided a variety of ways that you the consumer can a) communicate with each other and b) receive a variety of bids from dealers.
However, this process will only be fully successful if you the consumer understand what you need to know in order to bid for the best price for you.
Before you begin negotiating, you must understand how a lease works, your obligation in the lease and what the best lease scenario is for you. Remember each situation is unique and what is a good price for you may not be the best one for you.
You’ve enjoyed driving your vehicle for the past two to six years, and now it is time to return the car. So what happens? On average there are three parts to the lease return process: the pre-inspection report, returning your vehicle to the dealership, and the final inspection report…
Directly on the lease contract, there is an area that discusses the options that you have at the end of your lease. You should begin looking at cars and the options available at minimum 6 months prior to your lease termination and ideally a year in advance. Waiting to the last minute can become costly, both financially and mentally. Avoid this unnecessary strain by planning ahead and answering a few questions…
You love your vehicle and you can’t imagine wanting to return it early. However there are some life circumstances that you cannot predict or control which may dramatically alter your vehicle needs. Picture this…you go to work and find out that you’ve just been given a promotion. However, the promotion means that you will be transferred out of the country for the next two years. Or surprise, you’re pregnant and you’re driving a convertible with no back seat.
The one thing that is a constant is change. A lease is a set payment for anywhere from 2-6 years depending on your contract. If one of the above scenarios occurs, you will be frantically checking for ways on how to break your contract. However, you want to do it in a fashion that financially makes sense.
If this is your first vehicle, think of other large purchases that you have bought? Are you the type of individual to always want the next best thing? Do you constantly upgrade your phone and were you hungering for that new IPod? If so, you may enjoy the fact that with leasing you can receive a brand new vehicle every two to six years depending on your contract term.
Whether it’s Future Shop, Sears or your local appliance store: everywhere is offering extended warranties. When purchasing a warranty for a washer, dryer or a new computer it is a fairly easy decision. Is $50-$200 extra worth the peace of mind for another year? For the majority of buyers, it’s a quick response: usually based on the cost of the warranty. Sadly, this is also how quickly a decision is made for extended warranty on a vehicle. When the cost of a warranty can range anywhere from $700-$3000, the buyer often quickly responds no. Don’t be this buyer! Extended warranty is not for everyone. However, having the additional coverage provides peace of mind and makes financial sense for a lot of consumers.
If a deal sounds too good to be true, it probably is. Advertising is designed to whet the consumer’s appetite and get you into the store eager to buy that new product. In a print ad there will be a bold statement announcing the fantastic savings you will experience. However, it is the fine print that contains all of the information:
A dealer’s goal is to make a profit. The majority of sales people are on commission which means that they only make profit from the sales that they make. The following are some ways that dealerships may earn a profit from your deal:
1) The difference between the invoice (wholesale) price of the vehicle and the amount the vehicle is sold for
Credit Insurance is a protect for the unexpected negative events in life: such as death, disability and job loss. Purchasing this insurance will help protect your credit rating and provide an additional peace of mind to the consumer who may be concerned about unpredictable events. The dealership will often discuss these optional insurances with you when you are finalizing your lease agreement.