Leasing a car instead of buying it lets you drive a new one for less. However, it is important to always read the fine print before you sign on the dotted lines. Leasing can lead to lower monthly payments; however, it can also be expensive if you make certain mistakes along the way. These mistakes include the following:
Paying Too Much at the Start of the Term
It is not surprising for car dealers to advertise their lower monthly lease payments. However, you may have to pay big at the start of the lease term to get a low payment. In general, this payment is often an advance payment for the car lease. However, if the car gets stole, you will lose that money upfront. While the car dealer gets reimbursement from their insurance company, you are left with no refunds. This means you have no car to drive even if you have paid for the lease in advance.
Failing to Consider Gap Insurance
Every vehicle drops in value once driven off the lot. This is even true for leased cars including the 2019 Special Edition Dodge models. Once you lease a car, you need to secure gap insurance. The gap refers to the difference in what you still owe on your lease and the way insurance provides value your vehicle. In case the vehicle gets stolen, the dealer’s insurance provider pays the assessed value of the car. However, you will have to take care of the difference or balance. To ensure you don’t spend your own money on this, secure gap insurance.
Failing to Pay Attention to the Mileage
A lot of leasing companies advertise low monthly payments since they have low mileage limits. Often, driving contacts limit driving to just between 10, 000 and 15, 000 miles. When you drive beyond these limits, you will have to pay for the excess mileage. Thus, when it is time to return the car after the expiration of the lease, you may have to pay a significant amount of money on a vehicle you won’t be driving anymore. This makes it important to consider your driving habits before you lease a car.
Failing to Maintain the Vehicle
If the vehicle you leased incurs damage beyond normal wear and tear, the leasing company can charge you with extra fees for the damage. Because the definition of normal use tends to vary by dealers, you must be clear about this from the get-go. Ask the company if there are any lease-end condition guidelines.