One of the benefits of car leasing is you get to drive a new vehicle at a lower price. Before putting your signature on the contract, make sure that you thoroughly understand the details and the terms, so you know what you are getting into. Moreover, equip yourself with knowledge on the mistakes that you should avoid when getting a car lease. Here are some of them.
No gap insurance
Not all lease contracts have gap insurance. Avoid the mistake of signing for a term that doesn’t offer this. If the leased car is stolen or wrecked, the insurance company will determine its value at the time that the incident happened, and this will be the amount that it will pay to the lease provider. This may not cover the remaining balance that you have, and if that happens, you will pay for it using your own money if you do not have gap coverage. If you have gap insurance, it will pay for the remaining balance that needs to be paid.
Paying a higher down payment
Even if you spend more on the down payment, the total lease cost will remain the same, although your monthly fee will decrease. Pay for a lower down payment as long as it will still be comfortable to pay the monthly fee. If the vehicle ends up being stolen or wrecked, you will not get any refund on the down payment that you already paid.
Not considering the mileage limit
Some lessees do not think of the mileage limit. It’s important to consider this because the cost might add up significantly if you drive more than the limit given. Consider your driving habits to help determine what mileage is best for you. You can purchase additional mileage if you feel that you need more than the given limit or find other personal car lease deals that meet your mileage requirements.
Leasing the car for an extended period
Do not lease a vehicle longer than its warranty period. For instance, if the warranty is three years, the term must be three years or shorter. This is to ensure that its servicing will be covered.
Not maintaining the vehicle
The maintenance and repair may be covered if it’s still under warranty. However, at the end of the lease period, the leasing company will check the car for significant damages that are not caused by natural wear and tear. You will be charged for these, so that’s added to your cost.
Focusing on the monthly rate only
Do not be deceived by the lowest monthly price. Some vehicles are offered at a cheaper monthly payment, but have a lower mileage limit, higher down payment, and have several other unnecessary extra charges. Take into consideration every aspect that affects the lease before deciding.
Leasing can cost more in the long run compared to purchasing a new or second-hand car. However, if you think that it’s what fits you best; be sure to avoid these errors when getting a deal.