One of the biggest problems facing consumers looking to lease is simply lack of knowledge. An unprepared consumer is at the mercy of the car dealer. It’s easier than you think to learn all you need to know to get the best car deals lease or buy. Here are a few of the most common car dealer tricks and tips for how to avoid them.
The Pay Off
Some tricky car dealers will tell you they can pay off your old car loan while getting you a better new car for lower monthly payments. Sounds great, right? Trouble is, it’s too good to be true. What the dealer will do is give you credit toward your new car lease for the value of your new car, but add your remaining debt to the financed amount. Then the financed amount is structured so the payments are in fact lower than your current payments. The dealer didn’t do you any favors – you’re still paying off your old car while paying for the new car lease as well.
Taking “Care” of Your Old Lease
If you’re still making payments on an existing lease don’t just hand over the vehicle to the dealership trusting they will take care of everything. Even if they make the remaining payments to the lease company you are still responsible for the vehicle. To put it in the simplest of terms, it’s like trusting your little brother to return your library books. Sure he may get around it it, but who has to pay the overdue or damage fees? As long as you are responsible for the vehicle keep it in your possession.
The Money Factor Switch
Honest mistake or not, the money factor and interest rate are two different things. Moving the decimal around on the money factor does not indicate the APR you are likely to pay. The money factor will look something like 0.0029 – that doesn’t mean the interest rate will be 2.9%. To estimate the annual interest rate you need to multiply by 2400. With a 0.0029 money factor you can expect about a 7% APR. Not as enticing as 2.9% is it?
No Negotiating Leases
You can negotiate a new car lease exactly as you would if you were buying the car. Leasing or buying doesn’t change a thing. Look at it this way, when you lease, the leasing company purchases the vehicle from the dealership, allowing you use of the vehicle until your term is up. To get the best deal you have to negotiate the purchase price of the vehicle and you are initialed to all available rebates and incentives.
It’s Easy to Terminate a Lease
Even though it is possible, this does not mean that terminating a lease is easy or trouble free. If you need to get out of a lease some leasing companies will let you transfer the lease. However, doing so can be stressful and complicated. Terminating a lease early is likely to cost you money and can even damage your credit. Review the lease contract carefully and plan ahead to avoid dealing with such problems.
Request a free lease quote today and arm yourself with everything needed to get the best lease deal possible!
