What to Expect When Leasing a Car

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Leasing a Car

• Leasing or purchasing a car is an intensely personal decision. Here are two major categories of what to expect when you lease a car at your local Indianapolis car dealership: 1. The Benefits of Leasing 2. Terms of Leasing

Benefits - Variety

• Many car enthusiasts want more than one car for the indefinite future. Leasing allows you to: – Experience the joy of trading in your car for a new one every three years, – Afford a more deluxe vehicle than otherwise, – Decide from almost every make and model.

Benefits – Electric Cars

• Want to help save the environment? Leasing is a great for driving around an electric car.

• You can keep up to date with the latest technology!

• Instead of buying and then selling old technology years later, you merely return your electric car when you’re done with it.

Benefits – Business Owners

• Yet perhaps the greatest benefit to leasing a car lies with business owners.

• If you use your leased vehicle for business related purposes, you can deduct almost all expenses from your taxes.

• Check with your tax advisor or local Bloomington dealership for more information.

Financials – General Knowledge

• When leasing a car, it is important to understand the economic details. A few general tips to keep in mind: – Leases are easier to obtain with low credit,

– Leases present less out-of-pocket costs,

– With warranties, you have to pay little to no maintenance expenses,

– Leases protect from depreciation over time.

Financials – Initial Payment

• When you first lease a car, the initial payment usually includes:

– first month’s payment,

– down payment,

– refundable security deposit,

– and registration fees.

Financials – Monthly Payment

• Monthly payments account for the car’s depreciation plus interest and taxes.

• Monthly payments are typically lower than car loans:

– Average monthly lease payment: $418

– Average monthly loan payment: $468.

Financials - Duration

• The duration of a lease determines how much it costs and for how long you posses the car.

• Typical leases last 3 years.

• With most dealers, you can negotiate contract length.

Financials – End of Contract

• What happens when your contract is up and you return the car?

– The dealership takes the car back,

– It assesses additional fees such as excessive mileage or major depreciation,

– You are free to lease or purchase a new vehicle!