More people are leasing new cars today than ever before. In fact, almost 30 percent of new vehicles were leased rather than purchased last year. With that in mind, here’s Lithia’s list of five steps to leasing a car. Follow along to see if leasing might be right for you. Car leasing is basically a long-term car rental.
You can buy your lease car at the end of the lease, but most people just turn the lease car in at the end of the three-year term of the contract and get another new leased vehicle. It could allow you to drive a new car for less money than if you purchased it.
Lease contracts can vary in many ways and your contract is the most important aspect of getting a good lease deal. We would suggest that you stick to a three-year lease, since most the automakers include a three-year bumper-to-bumper warranty on the vehicle. See dealer for limited warranty details.
Be aware that lease contracts include something called “drive off fees” – an up-front payment before you can take the car. Your dealer should be able to explain these fees in detail. Also, check with your auto insurance agent to see what it is going to cost you to insure the car.
Most lease companies require higher levels of coverage on lease vehicles. Most lease agreements include somewhere between 12,000 and 20,000 km of travel per year. Penalties for exceeding that mileage can be anywhere from 10 to 15 cents per km or more. If you plan on driving more than that, make sure you let your salesperson know up front; you can “buy” extra miles and have them rolled into your lease payment.
The average monthly payment for a Canadian leased vehicle in 2022 is $660. How you calculate your monthly payment for a specific vehicle can be discovered with an online payment calculator. You feed all your basic info into the calculator:
This will give you an idea of what you’ll pay. That way, as you are shopping for a specific car, SUV or truck, you can track what your monthly payment is likely to be.
You’ll find an excellent lease car payment calculator here. To properly use the calculator, you’ll need to find out the “residual value” of the lease vehicle. You can find that out by calling the dealership you are working with. Ask the representative for the three-year residual value of the car.
While researching the best deals and lease terms on a new car lease, you’ll notice that many automakers occasionally offer amazing deals on a lease. Be aware that these lease specials often include high drive-off fees up front, such as a large down payment.
Check for additional costs in the fine print of the lease ad. While the low monthly payment that is advertised might sound great, check to see if that payment includes sales tax and other fees.
If you know which make, model and trim level of vehicle you want to lease, you can narrow your search to an exact vehicle. Check with local dealerships to see if any of them have the exact car you want. If several dealerships are offering the same car, you may be in a better position to negotiate a better lease payment.
Lithia has over 270 quality dealerships across North America. Chances are, we have the exact car you are looking for, and with over 75 years of experience in the world of personal transportation, we’ll make sure you get the car you want and the right lease package for you.
