Do's and Don'ts of Leasing
|Nothing can make
a price drop like a better deal from someone else. Use
competition to your advantage: Request a free, no
obligation quote from each of our partners listed to the
right. Then when the salesman tries to convince you that
$500 off sticker is a "great deal", you can say,
"Gee, that's funny. I got three offers right here
that are $1000 less than your price." Then watch his
price drop to 100 bucks over invoice.
- Your Homework. Learn as much as you can about leasing. Be
sure to understand how a lease works and the meaning of the
- Read the Lease Contract - especially the fine print -
BEFORE you sign it. BE SURE to understand your obligations
and liabilities for early termination.
- Make Sure All the Figures Add Up. Calculate the monthly
payment yourself. If it doesn't match with the payment on
the contract, ask questions until you understand why.
- Know the Invoice and MSRP for the vehicle you are leasing.
- Be Prepared to Go the Distance. Early termination of any
lease is seldom painless and almost always costly. Make sure
that your personal situation will allow you to fulfill all
of the obligations of the contract.
- Pay Too Much for the Car. Ask yourself: would I be willing
to buy this car for the capitalized cost? If the answer is
no, go back to the negotiating table.
- Lease Without Gap Insurance. For just a few dollars a
month, you protect yourself from a big loss in the event of
- Lease Without Full Disclosure of the money factor,
residual value, and the capitalized cost. If the dealer is
reluctant, be persistent and state that you will not lease
without this information. After all, you wouldn't take out a
loan without knowing the interest rate, would you?
- Accept an Open-End Lease. Remember, in an open-end lease
the payment is based on an estimated residual value. If the
actual value is less at the end of the lease, you must pay
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When Paul Dignan strode into a Nissan
dealership to hammer out a lease earlier this year, he was all
smiles. It wasn't the snazzy sportsters in the showroom that put
the twinkle in his eye, but the nitty-gritty research up his
sleeve. Dignan had earlier used car-shopping software called
Expert Lease Pro.
"I was loaded for bear. When
they quoted prices to me, I just pulled out my sheets, pointed to
the invoice price and said, 'You're trying to charge me X and your
cost is only Y.' " Dignan says he saved $2,000 by using
Expert Lease Pro to leverage a better bargain.
Expert Lease gave Dignan another ace
in the hole for his lease negotiations: the estimated value of the
car at the end of the lease, also known as the residual value.
"Expert Lease Pro goes the extra
mile...provides a wealth of financial data."
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