Some people choose to lease a car rather than buying one outright. Here are some useful tips on what to consider before leasing a car: The most important thing to remember is that you do not own
vehicle. You get to use it but must return it at
end of
lease unless you choose to buy it.
Up-front costs may include
first month's payment, a refundable security deposit, taxes, registration and other fees and other charges.
Monthly lease payments are usually lower than monthly loan payments because you are paying only for
vehicle's depreciation during
lease term, plus rent charges (like interest), taxes and fees.
You are responsible for any early termination charges if you end
lease early.
You may return
vehicle at lease-end, pay any end-of-lease costs and "walk away."
The lessor has
risk of
future market value of
vehicle.
Most leases limit
number of miles you may drive (often 12,000-15,000 per year). You can negotiate a higher mileage limit and pay a higher monthly payment. You will likely have to pay charges for exceeding those limits if you return
vehicle.
Most leases limit wear to
vehicle during
lease term. You will likely have to pay extra charges for exceeding those limits if you return
vehicle.