Vehicle Leasing 101 - Top Ten Car Lease FAQs

top vehicle leasing questions 

How Does Leasing a Car Work? What is an Auto Lease?

If you're wondering what is car leasing, or how does leasing work, then you're in good company. Some of us may not be familiar with all the benefits of leasing a car. There are, in fact, a good number of auto leasing options available these days.

Generally speaking, vehicle leasing is the rental of a car, truck, SUV, minivan, sports car, or electric car for a fixed period of time. Auto dealers offer vehicle leasing as an another option to traditional auto financing or purchase. It is commonly used by companies when acquiring business vehicles. In general, leasing a car costs less than buying a car, although there are several restrictions, such as vehicle mileage limits and non-customization agreements, that can determine whether it is better to lease or buy a car.

Let's examine our ten most commonly asked questions regarding auto leasing.

  1. Leasing or Buying a Car - Which is Better?

  2. The short answer to this question is: 'it depends'. If you drive a lot of miles annual and like to keep your vehicles for longer than three years, leasing won't be very beneficial for you. However, if you like getting a new car, truck, or SUV every two to three years and have no interest in the trade-in/selling process of your current vehicle, you could be a prime candidate for an automotive lease. Essentially, the difference between auto leasing or buying really comes down to your personal, automotive and financial priorities.

    Also, it is worth mentioning that some owners find high mileage leasing to be more beneficial in terms of financial safety and security than vehicle ownership. Statistically speaking, despite the overage fees you may pay when returning a high mileage leased vehicle, it is likely that you will come out ahead, compared to buying a car. High mileage causes a significant reduction at resale, but with leasing, it's already taken in to consideration. Additionally, the more time you spend on the roads, the more susceptible to accidents you will be. Therefore, if or when that accident occurs on your own vehicle, you would receive wreck history on CarFax, as well as a resale/trade-in deduction for vehicle damage. With leasing, you are not responsible for the deduction in value from that accident.

  3. Car Leasing - Is It a Good Idea?

  4. There are many benefits of leasing a car that you just can't get with other auto financing offers. These benefits include lower payments, maintenance provisions, and avoiding having to trade-in or sell your old vehicle. For more details on the benefits of leasing, our auto finance department is waiting to answer all of your questions.

  5. Can You Lease a Used Car?

  6. Yes, you can lease a used car. This type of 'used car leasing' is a little known 'secret' among auto dealership but most dealerships do offer Certified Pre-Owned leasing specials on CPO vehicles less than four (4) years old and with fewer than 48,000 miles on the odometer.

  7. What Does It Cost to Lease a Car?

  8. If you're wondering how much does it cost to lease a car, the good news is that it's negotiable. Many manufacturers and dealerships offer zero-down lease offers. Like any financial product there are varying factors that qualify or disqualify individuals from these types of leases. Factors such as credit payment history, credit scores, etc. Just don't forget that paying zero down typically means bigger monthly payments. Car leasing, like traditional auto financing, works like this: the bigger the down payment, the lower the monthly payment.

  9. Can One Get a Deposit Back From Car Leasing?

  10. Typically a lease deposit is refundable at the termination of the lease. This assumes that all the leasing contract specifications have been met. Please note that a deposit (a.k.a. a security deposit) is not the exact same thing as a down payment. A down payment is not refundable but security deposits typically are. Also note that some leases require non-refundable deposits. Therefore, read your lease agreement diligently and ask as many questions as you have before you sign on the dotted line.

  11. May I Purchase the Car I am Leasing?

  12. The majority of auto leasing contracts have buy-out clauses in them in the event that you fall in love with your car and would like to buy it. Please note that the purchase price of the vehicle may vary. This depends on the vehicle's residual value after the lease agreement has expired. There are also options to purchase your leased car before the contract has been fulfilled. For this, however, you must speak with a financing representative. Only they can provide these buy-out details and take care of any early termination fees that may apply.

  13. Does Car Leasing Require a Good Credit Score?

  14. In general, credit score of 619 or lower is classified as "subprime". While this type of credit won't typically be automatically declined, a credit score lower than 619 means you will typically have to pay a higher interest rate and/or down payment. Luckily, there are various steps you can utilize to improve your credit score like apply for too many loans, employment history, and consistent on-time payments.

  15. Is It Possible to Lease a Car with Bad Credit & 0 Down?

  16. While it is not impossible, it is difficult to lease a vehicle if you have a poor credit rating and no money for a down payment. Most zero-down lease offers require a healthy credit rating. But don't worry, there are plenty of options available for car shoppers with less-than-stellar credit scores. To explore your leasing options, simply contact our financing team.

  17. Is Maintenance Included With My Car Lease?

  18. Of all the benefits of leasing a car, maintenance benefits are typically the most popular. Specifics will vary within individual lease contracts, but most leases will cover your leased vehicle's normal maintenance and service needs. These include filter and fluid changes, normal tune-ups, and regularly scheduled maintenance typically doesn't cost anything out of pocket.

  19. May I Return My Lease Vehicle to a Different Dealership?

  20. Typically speaking, yes, you can trade in your leased vehicle at a different dealership. It must, however, be an authorized dealership for the vehicle manufacturer. It's probably obvious, but you can't turn a leased car into any other brand of dealership. You can, however, turn your leased Audi into any authorized Audi dealership across the nation. Again, assuming all your lease contract obligations have been fulfilled.

Contact a Car Leasing Expert Today

Do you have more questions about vehicle leasing, current promotions, or related topics? Then contact us today. Our team of leasing specialists are on hand to answer all your questions.

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Vehicle Leasing 101 - Top Ten Car Lease FAQs | Audi El Paso
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