A Lease: The Basics
When you walk on to a dealership's lot, the first words out of the mouths of most salesman will likely include the words “purchase” or “buy” leading many to the conclusion that there are no other options. Besides the fact that the signs and contracts that many people navigate in the pursuit of a new car are increasingly complicated, the salespeople themselves have a great deal to gain by continuing this mis-perception—after all, selling you a new car requires far less work on their end than to put you in a new car lease.
A car lease is actually far more affordable than buying. When you're purchasing a new car, you're paying the ticket value of the car immediately; but when you lease a car, you're only paying the difference between the value of the vehicle now and the expected value of the vehicle at the time that the lease agreement is up, amounting to only a portion of the entire vehicle's value. Often these lease agreements run for a year or more, but it's worth noting that the depreciation of a vehicle is not linear, so a two year lease would not necessarily mean that you would be paying two times the amount of a one year lease.
However, a car lease is actually a little more complicated than that. Although in theory, you would only be paying the amount of depreciation, lease agreements also often include mileage limits for the duration of the lease. Going over these mileage limits would incur a fee that you would need to pay when the lease agreement ended. Also, any damage other than normal wear and tear to the vehicle would also be penalized in the contract.
Because you're also on the hook for the full value of the car in the event of a wreck, you may also require more insurance than you're accustomed to paying for. This could offset any savings you may have achieved by getting a car lease instead of buying the vehicle outright.
Still, car leases can in many cases be a win-win situation for both the customer and dealer. The customer can walk out of the dealership with a better vehicle at a lower price in many circumstances and, even though it may leave them with more paperwork, vehicle leasing is often a more profitable venture for many dealerships. So the next time that you want to buy a car, why not ask UK Carline about the leasing options—they may have a very attractive offer in your area.