Whilst there are both advantages and disadvantages to car leasing – you needn’t worry about depreciation (advantage) though you won’t own the car at the end of the lease (disadvantage) – if you’ve thoroughly explored your options and you decide that leasing is the right choice, here are five mistakes many people have made that you should avoid.
1. Paying too much upfront
Minor upfront costs are one of the advantages to leasing over buying a car; however, many people make the mistake of paying upfront for one of two reasons.
Firstly, they’ve been told that in order to get a lower monthly rate they’ll need to pay more upfront, or secondly, they didn’t do their homework and as a result didn’t know what to expect.
To avoid this, ensure you understand the overall cost of leasing a car, including paying more upfront in order to get a lower rate, and compare rates and upfront costs before discussing matters with a leasing company.
2. Overlooking the importance of gap insurance
Not sure what gap insurance is? Many people have made the mistake of not enquiring about specialist gap insurance and have found out the hard way.
Gap (Guaranteed Auto Protection) insurance covers the difference between what the car you lease is worth and what you still owe on it if the car is totalled in an accident or stolen.
Gap insurance is essential, make no mistake about that; however, you should also ensure you don’t pay too much for it which is another commonly made mistake.
3. Failing to properly maintain the car
Before leasing a car make sure that you understand what’s considered ‘normal wear and tear’ in the lease-end guidelines, because any damage that goes beyond what’s considered to be ‘normal’ you’ll be liable for, and it suffices to say, at the full market price.
Take care of the car you lease and if you notice a problem, attend to it immediately.
4. Not considering the mileage
How many miles are you planning on doing in the car you lease? Many people have encountered problems because they’ve underestimated the number of miles they will drive in their leased vehicles and extra mileage can prove costly.
It’s normal for car leasing companies to cap annual mileage at 12,000 to 15,000 miles per year, which is quite a lot – 48 miles per day (five days per week) on an annual mileage cap of 12,000 miles – so if you think that you’ll exceed this limit you should enquire about a higher limit.
If you exceed your annual mileage cap expect to pay about 4-5p per mile for every additional mile and that could prove expensive.
5. Leasing for longer than they should
A general rule to adhere to regarding the length of the lease is don’t lease for longer than the car’s warrantee, which is usually three years or 36,000 miles. If you lease for longer than the warrantee there’s a good chance you’ll incur excessive maintenance fees and the overall leasing cost will cease to be cost-effective.
Whilst these are five of the most common mistakes people make when leasing a car for business or personal use, they’re not the only commonly made mistakes.
With that in mind, shop compare rates before deciding upon a car to lease by visiting websites like www.leasingoptions.co.uk, understand how to opt out of a lease and don’t turn in the car early because you are still liable for costs and charges, including vehicle depreciation until the lease ends.
About the Author:
A company that does not just offer a competitive price but also a tailor-made package to suit each client, Leasing Options on http://www.leasingoptions.co.uk/ is a leading provider of the best possible deals for car lease and contract hire.