You have probably seen ads on television talking about how you can lease a brand new car for $199 a month. On the surface, that seems like an incredible deal. However, you are not getting the deal that you think you are. If anything, you should avoid leasing a car altogether. Here are five reasons why you should avoid a lease.
There Is No Equity Built Up In A Lease
When you purchase your car from a dealer, you get an auto loan from the bank. As you pay off that loan, you build equity in your vehicle, whether it is a new Hyundai Getz or even something more desirable like an Audi Q3. This equity can be used to help you pay bills, purchase a new car in the future or whatever else you would want that money for when you sell the car. However, a lease doesn’t offer you that. All you are paying for is the right to use the car.
Can You Limit Yourself To 12,000 Miles A Year
Most car leases will have clauses in them limiting you to a certain amount of miles per year that you can drive. That limit is usually 12,000 miles a year on average. If you don’t think that you can stay within that limit, a lease is most likely not for you. Some dealers may be willing to negotiate a deal that includes extra miles for a fee.
The Car Better Come Back In Perfect Condition
Leasing a car is a lot like leasing an apartment. It better be in great condition when you are done with it. You could be charged for any damage that occurs to the car during the lease term. When you purchase your car, you don’t have to worry about small dings in the paint job.
You Always Have A Car Payment
Car owners can enjoy the lack of a monthly car payment once they are done paying off their loan. When you lease, you always have a car payment to contend with. This is because you will need to lease another car when your current lease runs out.
In this economy, it is better to own your vehicle outright. Even if you do decide to buy the car after your lease runs out, that still means that you have a car payment for another three to five years on a car that isn’t even worth as much as you are paying for it.
Lemon Laws May Not Apply To Leased Vehicles
Be very careful when leasing an automobile. This is because you could be given a dud without knowing it. If you are given a car that needs a lot of work, you may not have any recourse. Make sure you check the laws in your state regarding leased vehicles that turn out to be lemons.
Always purchase your car outright. You will save yourself a lot of time and hassle by opting to own instead of lease a car. Drive as many miles as you want, build equity for the future and enjoy not making a car payment at some point in your life. Anyone would be able to appreciate that.
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