Leasing a Car
Get key information about the lease before you sign on the dotted line.
Many new car drivers lease, rather than purchase, their vehicles. Although leasing can be a good deal for some people, for many it's not. Before the dealership persuades you that leasing is the answer to your prayers, you should have a good understanding of the advantages and disadvantages of a lease, where to get a good lease deal, how to get all the facts about cost, and what happens if you have to cancel the lease early.
What Is a Car Lease?
When you lease a vehicle, you don't own it. You get to use it during the lease term, for a monthly fee, but must return it at the end of the lease. In many leases, you have the option to buy the vehicle at the end of the lease. (For more information on short-term car rentals, see Renting a Car.)
The Advantages of Leasing
There are two main reasons people lease, rather than buy, a vehicle:
- People who like to drive a new car every few years will usually pay less by leasing than if they buy. And they also don't have to deal with getting rid of their old car -- they just turn it in at the end of the lease period.
- Lease payments are usually lower each month than loan payments for any given car. As a result, many people lease in order to drive a more expensive car than they could afford to buy.
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