Leasing 101 Lafayette LA

When you lease, you are paying for the use of a vehicle.

Local Companies

Courtesy Lincoln Mercury-Lafayette
(337) 991-0100
6885 Johnston St
Lafayette, LA
Ford Truck Center
(337) 232-0090
2900 NE Evangeline Trwy
Lafayette, LA
Hub City Ford Inc
(337) 233-4543
2909 NW Evangeline Trwy
Lafayette, LA
Moss Motors Used Car Airport
(337) 233-7069
2100 Surrey St
Lafayette, LA
Moss Motors Inc
(337) 235-9086
1401 Surrey St
Lafayette, LA
Import One
(337) 984-4700
2611 Ambassador Caffery P
Lafayette, LA
Used Cars of Acadiana
(337) 983-0455
2604 Ambassador Caffery P
Lafayette, LA
Hub City Ford Inc
(337) 237-5135
2909 NW Evangeline Trwy
Lafayette, LA
Lingo International Inc
(337) 234-9425
2835 NW Evangeline Trwy
Lafayette, LA
Hampton Toyota Scion
(337) 984-5010
6191 Johnston St
Lafayette, LA

Leasing 101

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2003 Porsche Boxster
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Understanding Leases

When you lease, you are paying for the use of a vehicle. Your payments cover the cost of the vehicle's depreciation over the time you drive it, rather than the purchase price. When the lease is up - typically in two to four years -- you must return the vehicle or purchase it outright. This article will explain what you need to know if you're considering a lease. Before you make your final financing decision, you should also review our articles on loans and the differences between loans and leases.

 

How lease payments are calculated

To calculate a lease payment, the financial institution (the "lessor") estimates the amount the vehicle will depreciate over the lease period, adds the interest being paid by the lessor to finance the car while you drive it and several other fees. Many leases can be started with 'no money down,' although a down payment ensures lower monthly payments.

The Federal Reserve Board recently enacted consumer-friendly legislation that requires dealers to disclose all the key variables of a lease: the interest rate, residual value, length of lease, and size of down payment.

 

The two- to three-year lease

Short term leases work for those who want a brand-new vehicle every few years. The manufacturer covers major maintenance costs for the duration, and you usually pay for required servicing. A major concern: if you terminate this type of lease early, you'll most likely pay severe penalties. Returning the car when the lease is up When a lease expires, you can either buy it, or return it. If you return it you must do the following:

  • Return the vehicle in its original state with no accessories, modifications, or different parts.
  • Make sure the vehicle is in good shape, with no excessive "wear and tear." There are penalties for damage or rough treatment.
  • Meet mileage limits, usually around 12,000 - 15,000 miles. You will be charged anywhere from 10 to 15 cents for every mile you drive over the limit, which can really add up. For example, if you drive 20,000 miles per year for three years on a 12,000 mile/15 cent lease, your penalty would be $3,650.
Continue to Leasing 101 Review from MyRide.com
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