There has been a massive increase in the number of people opting for leasing a car instead of buying it in the recent years. The reason can be attributed to the ever increasing depreciation in the resale value of a car. It has been observed that most cars end up being only 30% to 50% of their original value at the time of resale. It results in a major loss for the vehicle owner which can be averted if the car is on a lease. Especially in Los Angeles, there has been a sudden increase in the number of cars being bought on lease or contract hire. We shall now look at certain aspects of leasing a car in Los Angeles.
What does leasing a car mean?
Most people end up confusing a lease with renting a car. In fact it could not be farther from truth. Leasing a car means that you will be paying a fixed amount of money to the car dealer every month but the ownership of the car will remain with the dealer. There is no need to pay a huge deposit in the beginning. And at the end of the term of contract you can return the car and opt for a new one. In between, depending upon the regulations of the contract, the repairs and maintenance cost of the cost will be borne by the dealer.
Advantages of leasing a car
There are several advantages of leasing a car. The foremost is that you will end up saving a massive amount of money by avoiding depreciation on the vehicle. Since the dealer owns the car, it will be returned back to him at the end of the contract. There is no need to resale the car.
Another advantage is that it will help you in renewing your vehicle every 3-4 years. In fact you can change the vehicle whenever your lease term ends thus making it an attractive option.
Since there are mileage allowances in a leasing contract, you can always bargain with your dealer in order to get you mileage limit increase. This said, you should only opt for leasing a car if your monthly travel mileage is not extraordinary. Since going over the mileage limit can cost you extra money, it is safer to stay within the limit.
Things to remember while leasing
Though leasing is a comparatively safer option than buying if you need to save on costs, there are some aspects of it that should be kept in mind. You should always take a microscopic look at your finances before signing the agreement of lease. The reason is in the long term, a lease agreement may end up costing you more than you anticipated. Since monthly payments will be involved, your finances should be absolutely in order or else you might end up parting with your beloved car sooner than you thought. It is better to be safe than to be sorry at a later stage.
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