The car leasing means that you pay only a portion of the cost for your vehicle. This cost includes what you use up during the time that you drive a car. But this amount is not as same as buying a new car, rather it will totally lesser than the new one. In most of the car lease agreements, you can either return a vehicle or buy it for the vehicle’s depreciated retail value.
One of the key benefits of Car Leasing is offering only lower monthly payments than buying. Another great thing is able to buy a new or latest model vehicle after every two or three years with no repair risks. Today, many car leasing companies can offer a wide range of personal finance schemes to the individuals. When it comes to choosing the best car lease, there are some important aspects to consider in your mind that includes:
- To consider the length of contract term that usually between 24 and 60 months.
- Depreciation value of car is very cheaper to lease.
- Know the early lease termination penalties during the agreement.
- Read the contract terms and excess mileage charges thoroughly.
- Customers cannot modify a vehicle in any way.
Advantages of private car leasing
One of the major reasons for the growing popularity of the car leasing is very low depreciation rates than financing a new car. Most of the cars are being worth between 30% and 50% of their original purchase even after three years. Some manufacturers can offer great deals for car models that can be very lesser than the amount of vehicle, which is depreciated. The advantages of Car Leasing are given below:
- Flexible terms
- Fixed monthly payments
- Free delivery at your doorstep
- Low initial outlay
- No worries about depreciation risks
- Avoid the hassle of disposing a new vehicle
- Flexible to extend the lease
- 100% tax relief
- Claim up to 50% of the VAT back on cars
- Improve cash flow
- Reduce the administrative costs
Factors to consider while choosing a car leasing
If you need a car to drive, but do not spend much cost on it, you may consider getting a car lease. There are some important factors to consider in car leasing that includes:
- Car residual value
- Depreciation of car value
- Length of leasing contract
- Amount of mileage the car gives
- Natural wear and tear has occurred for a car
- Penalties that may be imposed on terminating the lease