Often you might wonder if it is better to buy a car or lease one. Both have their merits and demerits but in this case, it simply comes down to your driving requirements. Buying a car is a long term investment and an expensive one at that. On the other hand, leasing a vehicle for a fixed duration doesn’t pressurize you to commit to one car. You can switch vehicles and get a better offer with a new one.
There are many ways you can save a few hundred bucks on car leasing deals. Check out these clever pay-off strategies.
Paying more security deposit (refundable)
There is a legal requirement to pay up a certain amount of money upfront as part of car leasing deals. This deposit, combined with the total value of monthly payments and interest, will make up the total cost of leasing the car. However, when you are willing to pay a higher amount for the deposit, the lease company will offer a better deal with reduced installments and a cheaper interest rate. In financial terms, this consolidation is known as the money factor. A lower money factor automatically reduces the cost of the overall lease.
Paying for the lease upfront
If you can afford to pay a major portion or even all of the lease upfront, you can get stellar car leasing deals from some of the most reputed companies. A single pay lease can save you the entire amount of interest right from the get-go. Another benefit of the single pay lease is that if you were not previously qualified for a good lease, companies will consider your application owing to the fact that you are willing to pay the lease cost upfront.
Extend your lease for a while
You might wonder how does extending a lease save you money. It doesn’t necessarily do so. But the extension will help you plan the next lease and avoid ending up taking car leasing deals that are simply not suited for your purpose. It is not uncommon to start panicking and take whatever deals come your way at the end of the first lease. However, by simply extending the tenure for a couple of months, you buy yourself time to make an informed decision and not rush into the next purchase.
Find a lease takeover
In some scenarios, you may be paying the lease already but want to get out of the current one for a better deal or vehicle. However, early exits from car leasing deals can cost you a penalty. It is an expense that can be completely avoided by opting for a lease takeover. It is possible to list your lease online and any interested party can contact you with a deal via an agent. Websites like LeaseTraader.com, Quitalease.com, Leasequit.com, and Swapalease connect potential buyers and sellers directly to simply take over the lease deed or title. You can thus avoid any lease termination penalties and can book new car leasing deals right after the sale.