Car leasing is a way to drive your dream car without having to pay for the full value of the car. Leasing a car works similarly to renting a car, except a lease usually lasts longer. When applying for a car lease, you sign a contract to pay a certain amount of money to use the car for a period of time. At the end of the lease period, you can choose to return the car to the dealer, buy the car or lease a new car. You can also choose to renew your lease on the current car.
Leasing a car for the first time can be a bit confusing. For first-time lenders, you might think that leasing a vehicle will be stressful, but that is not so. Leasing a car is one of the best ways to try out new cars like the electric Kia EV6 without buying the car. To make it easier for first-timers to lease a car, we have compiled a list of 5 tips that will make leasing your first easier.
1. Determine Your Mileage
When getting a lease, it is best to determine your estimated annual mileage because it will be accounted for. Mileage plays an important role when calculating the depreciation of the car. Part of your monthly payment covers the car’s depreciation because, as you will notice, the more miles you drive, the less value the car will have when returning it to the lender. As a first-time lender, it is easy to overestimate your mileage because you don’t want to pay for exceeding the limit. Still, it is equally important not to underestimate your mileage as that can lead to extra fees. You can determine your annual mileage by calculating your weekly mileage and multiplying it by 52.
2. Decide on a Budget
Another tip for first-time lenders is to decide on a budget. Deciding how much you can afford to pay monthly will help you decide on what vehicle to choose. Knowing how much you can afford monthly will also reduce stress during the lease period. There are two major payments you have to consider when choosing a budget for leasing a car. The first is the initial payment. The initial payment is like a car deposit. The more you pay for your initial payment, the less you will pay for subsequent monthly payments. Monthly payments primarily depend on the total value of the lease minus your initial deposit. Your mileage can also affect your monthly payment.
3. Use an Approved Car Dealer
Another important tip for first-time car leasers is to check out approved car dealerships. While numerous car leasing services are available, you should pick one that will suit your needs. When choosing a place to lease a car from, you should only use providers that are financial conduct authority FCA regulated. You will usually find their FRN number on the company website or other company literature. Another thing to look out for is the British vehicle rental and leasing association. A leasing company that is a member of the British Vehicle Rental and Leasing Association will provide the assurance of getting professional conduct. Another way to find approved car lease providers is to check their reviews by other customers online.
4. Insure Your Leased Vehicle
A car lease contract will contain details like manufacturer’s warranty and road tax, among other things, but it usually does not come with insurance. We recommend getting a comprehensive insurance policy to cover your leased car. This insurance will cover you if you damage the car or damage another person’s car. The insurance will also cover stolen vehicles. It should be noted that you should have insured your leased car before you leave the car dealership.
5. Check The Car
The fifth tip for leasing your first car is to check the car. The car dealership agent will take you to check the car to document any damage to the car and any issues you might have with the vehicle. You should also make sure that the extra tires and other necessary tools are available and working properly. You should also make sure to take note of the mileage on the vehicle. The car dealer will check the car at the end of the lease, so it is better to take note of the car’s condition before you leave the dealership.
Choosing whether to lease a car is a major decision that can bring about a lot of uncertainties. The process of leasing a car for first-timers might seem like a strenuous process. While it might seem like a lot, with the proper identification and credit rating getting your first leased car will be a simple process.
