Car Leasing- Car Clubs
To lease or to buy, that is the question. However, finding the answer may not be as difficult as many people believe it to be. There are many misunderstanding that circle around leasing a vehicle. Getting the correct information about car leasing can be daunting. Therefore, it is important to always do your research, before deciding to buy or to lease.
Contrary to what you may have been told in the past, leasing a vehicle, does not mean that you are renting it. When you purchase a new vehicle from a dealer or on a showrooms floor, you do not own the vehicle, the finance company does. When you decide to lease a vehicle, you are not getting the vehicle leased through a dealer either. Instead, you are actually leasing the vehicle through a leasing company that is affiliated with the dealer.
The way that it works is the leasing company that decides to allow you to lease the vehicle, will purchase the vehicle from the dealer. The leasing company then will make the final decision to allow you to drive the vehicle for a specific amount of time. Typically, the maximum amount of time that you can keep the vehicle is for a period of 36 months. The vehicle can only be driven a maximum amount of 12,000 miles per year.
The time that you are given to drive the vehicle, is called a term period. The term that you are given is set by the company that you lease the vehicle through. Sometimes the miles that you are going to be permitted to operate the vehicle will fluctuate between 10,000 to 15,000 miles every year. The time that you are permitted to use the vehicle can be anywhere from twenty four to forty eight months.
You will be required to pay for the depreciation on the vehicle over the time that you have the vehicle in your possession. An additional interest rate will be added into your payment. However, instead of being called interest, like it is when you are given a loan for a vehicle that you purchase, the interest is called the money factor. While you are operating the vehicle, the leasing company is actually losing out.
They will pay the entire cost of the vehicle, while you will be responsible for paying a small amount every single month that the vehicle is in your possession. The depreciation rate is set by the agent that is leasing the vehicle. Residual is what is estimated by the leasing company, in order to determine what the vehicle is going to be worth once the lease period has been satisfied.
Many people do not realize that it is possible to negotiate the amount of money that they will be required to pay in order to lease a vehicle. In many accounts, individuals believe that it is the leasing company that is calling all of the shots, this is not true. Motorists do have the ability to negotiate the sticker price on the vehicle. In many ways, leasing is the same thing as buying.
When you think about it, most people end up trading their cars in after they have had them for three to four years. With leasing you are able to save a considerable amount of money and get a newer vehicle every three to four years as well. So, whilst owning your car may be a viable position, leasing a car is quite appealing too. You will be able to drive newer cars, and not run the risk of being stuck with an older vehicle at the end of the lease.