Leasing can seem confusing for many. That is why if you plan to undertake the responsibility of signing that contract and reaping the rewards, you are first going to want to understand the lingo. Getting a quick lesson in what leasing really is and the words commonly used when leasing will not only save you a lot of mental strife during the process but will also give you the best opportunity to sign a contract that you can truly feel satisfied with. To start, let’s define what leasing really is all about and discuss the advantages of an Acura lease.
Leasing is the process of signing a contract with the intent of renting a car from an automotive dealer or manufacturer for an extended period of time for a small monthly fee. Most contracts last 2 to 3 years, and includes a warranty that will cover large-scale issues. The vehicles that are available for leasing are the latest models which add to the appeal of this process and attracts many drivers to this option.
What are the limitations?
Under the terms of this contract you will have the right to drive this vehicle however you like, but since you do not own it, there will be certain limitations. Leasing will often have a mileage limit that you will be charged for once you go over; this will typically be set around 15 to 30 cents a mile over the limit. The lower the mileage rate you agree to through the better deal you will get on your lease. Additionally, you will need to be sure to keep it a condition that does not exceed general wear and tear. Most dealers will charge a hefty fee for things such as scratches and dents that harm the overall value of the vehicle and increase its depreciation rate.
Leasing is mostly for those drivers who find themselves often desiring a new vehicle with the latest features on a regular basis. If you want a new car every few years, don’t have a high mileage rate, and enjoy keeping your vehicle clean then you should be able to benefit greatly from going into a lease. Leasing also removes all ownership responsibilities and makes driving a newer vehicle convenient.
What Happens When It’s Over?
Funny enough, one of the best parts of leasing once it’s over. You no longer have to try and trade in, sell, or scrape your old vehicle in order to get a new one, just return it. When a lease is over, you have the right to either extend the lease, buy the leased vehicle for a depreciated rate, or just turn it over and never look back. A good rule of thumb though is to never lease a vehicle for too long since depreciation is pretty quick on newer vehicles.
What is Negotiable?
When creating your lease, there are a few items that are flexible that you will want to look at closely before signing anything. The main factors you will have some control over will be:
- The total cost for the vehicle
- The trade-in value of your old vehicle in terms of how much will go to the lease
- The interest you will have to pay
- The mileage cap and the fee for going over the mileage
- The price you will pay to buy it at the end of the lease (better before than after)
What is Non-Negotiable?
As there are things that are flexible in a lease, there are also things you should never both trying to change. Such things include:
- The estimated worth of the vehicle when the lease is over
- The administrate charge to cover the cost to prepare the lease
- The taxes and registration set by law
- The end of lease fees that help to refurbish the vehicle
- the purchase fees if you buyout the leased vehicle
Why Lease Now?
In today’s society cars are only becoming more advanced by the second, and it’s always best to be on top of the latest trends without all the hassle of shopping to own. Not everyone was made to experience the world in just one car every decade, and for those people, it’s time to try out a lease.
The terminology of leasing may sound scary at first, but it’s actually quite simple once you connect the dots. Here are a few words that are almost sure to show up when you are in the process of signing a lease.
Lessee and Lessor
The lease and the lessor are just terms for the person signing the lease and the people who are offering the lease. The lessee will be the one getting the rental, while the lessor will be providing the vehicle.
Also known as the cap cost, the capitalized cost is basically just the price of the vehicle. This is not the MSPR though, and should not be confused the sticker on the window. The cap cost must reflect the lease value at the discounted rate.
This is an estimate made by a professional that will determine how much the leased vehicle should cost after you are done the lease. This is a reflection of the expected depreciation, and what you pay for the lease will be determined by the cap cost minus this value.
Cap cost reduction
Cap cost reduction is pretty much what the name suggestions. This term is what they use to refer to any decreases in cost that do not happen within the terms of the lease negotiation. For example, this would include the trade-in value of your last vehicle and special leasing deal from the manufacturer.
The money factor is sort of like an interest value on the lease that will tell you the amount you will be charged during your lease each month. Basically put, the higher the money factor, the higher your monthly payment. You will want to look for a low money factor in order to pay less for your total charges.
This is a fee that must be paid in order to prepare the lease for finalization properly. This is in addition to registration and taxes.
These are fees that you will be charged to assure that the leased vehicle can be refurbished and prepared for the marker after the lease.
Buyout price and Purchase options fees
This is the price you will pay if you decide to purchase the vehicle to own after the lease.
If you have read through these and have decided that you are ready to lease a vehicle, then your first option should be an Acura lease. Acura is a luxury brand, and their vehicles are the most stunning on the market with their sleek looks, powerful performance options, and intuitive features. An Acura lease will assure you will be leasing for all the right reasons. When you are in an Acura, you will be able to live life to the fullest and in the moment, and that is what leasing is all about. After all, If you are going to go for a lease, why not go for the best?