A Simple Guide to Understand Car Leasing

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World Wide Automobile

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A Simple Guide to Understand Car Leasing

• With a better understanding of leasing a car, you
  can make an informed decision as well as saving
  money on a car lease.

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A Simple Guide to Understand Car Leasing

• Leasing lets you drive your dream car. It is just
  like renting a car for a specific period. From
  luxury large SUVs to subcompact cars, you can
  lease almost any vehicle.
• The leasing cost includes depreciation, interest,
  and fees. While it may seem a straightforward
  process, it can be just the tip of the iceberg as
  many things are included.
• However, you can make the most of it if you know
  how to do it rightly, especially if you are a
  beginner.
• Here we will educate you on the leasing process
  so that you can have a sense of how leasing a car
  works.

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Leasing a Car vs. Buying a Carwhats the
Difference

• Well, this is no brainer.
• When you purchased a vehicle, you have to pay the
  entire price of the vehicle using cash, loan,
  exchange or a combination of all three.
• Talking about car leasing, you have to pay for
  the difference between the vehicles price and
  its expected value at the end of the lease, along
  with fees and interest.
• For example, the cost of a sedan is 50,000, and
  its supposed to be worth 40,000 after three
  years. Leasing it means you have to pay for the
  10,000 in expected depreciation with fees and
  interest. It simply means you are paying for the
  decreased value of a car over the leasing
  duration. Buying it means you have to pay the
  full 40,000 with fees and interest.
• You have to return the vehicle to the dealership
  once the lease term is over. You wont be deemed
  as the owner of the vehicle as the title is with
  the leasing company. There will be certain rules
  or limits regarding the usage, mileage,
  maintenance, and condition of the vehicle.

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Understanding the Important Car Leasing Terms

• Car leasing can be confusing just because of its
  jargons that are different than terms associated
  with buying a car. Here are some important terms
  to know

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Continued

• Cap Cost Also known as the capitalized cost, it
  is the price of the vehicle. And you can
  negotiate this price just like you will while
  buying a car.
• Cap Cost Reduction Anything that lowers the
  price of the vehicles is termed as a cap cost
  reduction. It can be the value of a trade-in,
  auto deal, or a down payment. Cap cost reductions
  reduce your monthly lease payments, the amount
  due at signing, or both.
• Residual Value It is the estimated value of a
  car at the end of its lease or at the end of its
  useful life. The residual value is determined by
  independent companies who specialize in
  estimating the value of automobiles. It will be
  mentioned in your lease documents, though it
  cant be negotiable.

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Continued

• Lease Term It is the period of time the car is
  leased for. The typical lease lasts two to three
  years.
• Money Factor Investopedia defines money factors
  as the financing charge a person will pay on a
  lease. It is similar to the interest rate paid on
  a loan, and it is also based on a customers
  credit score. It is commonly depicted as a very
  small decimal.
• Simply put, it is the interest rate you pay
  during the lease term.
• Security Deposit A security deposit is required
  by the leasing company to protect themselves in
  case of damaging, excessing the mileage or
  default on a contract. You will get your security
  deposit back if your lease doesnt include extra
  expenses.

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Continued

• Due at Signing This indicates that how much
  amount you have to pay while signing the lease
  contracts.
• Mileage Cap It defines how many miles you can
  have on the car when you return it to the
  dealership.
• Buyout Price It is the amount on which you
  purchase the car for at any time during the
  contract.
• Lessee The lessee is the person who leases the
  car from the company that is lessor.
• So you must have understood how leasing a car
  works. At WWA, we provide your dream cars on
  lease, from Cadillac, Porsche, Ferrari to
  mid-range like Nissan and Toyota. Our leasing
  rates are flat, affordable and transparent.
  Waiting for you at one of the car dealerships in
  Brooklyn!

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