Every day people buy new and used cars. Every day people lease new cars. Is it better to lease or by a car? More and more people are purchasing a leasing new cars. We provided information earlier today about the fact that bad credit auto loans are on the rise. But what about those people considering leasing a car. Here’s excerpts from an article in foxbusiness.com which looks at potential issues that need to be considered why leasing a car.
According to this article, there are four main areas of concern that consumers need to think about when considering leasing options. Those four issues are:
- Lack of equity
- Mileage limits
- Damage fees
- Legal wording
Let’s look at each of these a bit:
Lack of equity – when you lease a car, it’s very similar to leasing a residence… at the end of your lease term, you don’t own an portion of the vehicle. Thus, the payments that you made haven’t furthered your assets at all.
Mileage limits – Auto leasing companies usually limit the amount of miles that you can put on the car during the term of lease. If you exceed these limits, you can pay dearly.
Damage fees – while you still need to maintain auto insurance when leasing, there are other potential expenses and fees that wouldn’t be covered by typical auto insurance policies. The article points out that an individual was charged several thousand dollars as a result of stains on the car’s carpeting.
Legal language – as with any agreement, the language may be somewhat complicated, necessitating a lawyer to interpret the wording for you.
Is it better to lease or buy a car? Most people understand the basics of car buying. These are four potential pitfalls of leasing a car. You can read more of the article here: http://www.foxbusiness.com/personal-finance/2012/02/02/four-hidden-dangers-leasing-car/
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