Answers will shed light on the essential elements of a good lease deal
Many carmakers periodically offer highly discounted lease specials to pump up interest on slow-selling models, says leasing expert Joe Spina, Edmunds.com's director of remarketing. These specials could provide a shortcut to substantial savings for you.
A high residual value "gets you 80 percent of the way to a good deal," says Sergio Stiberman, CEO of LeaseTrader.com, a company that helps consumers transfer car leases.
Base Monthly Payment
The interest rate is called the "money factor" in leasing jargon. It's one of the few elements of a lease you can negotiate, says Oren Weintraub, president of Authority Auto.
Of course, the leasing company will give you an interest rate that is based, to some degree, on your credit. However, when manufacturers are trying to attract shoppers, low interest rate offers abound. So when you ask a dealer, "What is my interest rate?" he might respond by saying, "Well, the money factor is 0.00125." Convert this to an interest rate and make sure it is the rate you deserve for your credit score.
This is a great question to ask if you see a newspaper or TV ad offering a low monthly lease payment. You also want to ask the dealer this question if he offers you a "killer" lease deal.
6. What fees does the lease have?
Furthermore, fee amounts are different from one lease company to the next. In recent years, fees have crept up from $300 to more than $650. Fees may be hard to remove, but it doesn't hurt to question them, Weintraub adds.
Today's consumers expect more flexibility and want to be able to change cars more often, which used to be difficult to do under a lease contract, Stiberman says. It's a good idea, therefore, to ask ahead of time if the contract allows you to transfer the lease to another person for the remainder of its term.
As you get answers to these questions, you will get a much clearer picture of the value of the lease you are considering. You will also demonstrate to the dealer that you've done your research and have a grasp of the essential elements of a lease. Consider the answers carefully and you will have a lease that will save you money and provide an enjoyable driving experience.