The Downside to Leasing

Leasing does seem like a good option if you want a fancy car with none of the long term commitment but its not all roses!

Before you consider leasing - you need to look at the downsides of it too before you can decide if it is best for you!

The Disadvantages

1. You have to sign up for a set amount of time. If, for some reason, you need to get rid of the car for example because you have to move, are going travelling, change jobs, etc., you are bound to the contract which can be very expensive to get out of.

2. You are set to a strict amount of miles you can do every year (typically 15,000 miles); if you go over this amount of miles you have to pay for each additional mile you drive and this can be pricey.

3. Alternatively, if you only drive a fraction of the agreed mileage then you are paying for miles which you never used.

4. When you are finished with the car you have nothing to show for it. You have no car equity but in this current economic climate not having to worry about selling a car on may not be such a bad thing!

5. You don’t actually own the vehicle so can’t make any modifications to it - so boy racers are out!

6. You have to keep the car in good condition. There is obviously some unavoidable wear and tear that comes with driving so a lease contract will typically have a “wear and tear” agreement but if you are a fender bender driver or have kids or pets which you take with you, you might cause more damage than is expected and you will have to pay for this at the end.

So is leasing for you?

You are probably a good candidate for leasing if:

1. You drive around 15,000 miles a year.

2. You keep your car in good condition.

3. There are no future circumstances, that you are aware of anyway, which will force you to sell your car in the next 3 years

If you decide that leasing is for you, the most important thing is to make sure you trust the company you are dealing with. Read the agreement very carefully and make sure you are happy with all the clauses. If you are unsure of what something means, don’t be afraid to ask. Remember the person you are dealing with is a sales rep on commission. No matter how aloof they may appear to be, they want to get your business so don’t be afraid to haggle or get them to change parts of the agreement which aren’t suited to you!