What is Vehicle Leasing?
The idea of leasing is simple, but many people who are buying a car don’t completely understand it and are afraid of it. There’s a common misconception that it’s a kind of “rent-to-own” scheme that was created by car dealers that want to get more money out of the consumer.
Consumers are also led to believe that leasing is only good for business owners or if you lease, you’re just throwing your money down the toilet.
We bet you didn’t know that leasing was available for more than just consumer products. Phones and laptops can be leased but so can buildings and manufacturing equipment.
While there are companies that offer “rent-to-own” products, car leasing doesn’t work that way. When it comes to vehicles, leasing is simply another form of auto financing that’s a bit more complicated than traditional financing.
The idea of our leasing series is to give you a better understanding of what leasing is and how it works. That way you’ll be able to feel more confident to make a decision about leasing.
Understanding How Vehicle Leasing Works
If you’re considering leasing a vehicle, having an understanding of how the process works will allow you to better prepare yourself to pull the trigger. By understanding how leasing really works you’ll also be able to determine if it’s right for you. It’s simply about an education about knowing when you should lease and when you shouldn’t.
Leasing is a similar to a loan; it’s just another method of financing. Having said that you must make sure that you educate yourself about the ins and outs of leasing if you plan on taking that route. You shouldn’t lease if you don’t understand it and you absolutely shouldn’t lease if you’re only doing it to make your payments lower.
Why Choose Leasing?
Leasing a vehicle is a popular way to get yourself into a new vehicle. Luxury vehicles tend to be leased more frequently to keep the payments on the vehicle lower. While leasing typically offers significantly lower monthly payments in comparison to traditional financing, that’s not a good enough reason to decide to lease.
If you have a tendency to drive less than 25,000 km (approx 15,500 miles) per year, leasing may be for you. If you enjoy being in a new vehicle every 3 – 4 years, leasing may be for you.
Is Leasing Right For You?
The easy answer. It depends. Leasing offers advantages but it may not suit every driver’s lifestyle or needs. This lease guide was created to take the headache out of learning about leasing. It will be your road map, your Sherpa. We hope you enjoy!
