Leasing a car is a great way to get your hands on a brand new car when you can’t afford to purchase it outright. A car lease deal will enable you to pay in lower monthly instalments than other finance options, meaning you are more likely to be able to afford the vehicle that you actually want to drive.
However, as a car lease deal is typically a 3 year financial agreement between you and the dealership, it is important that you make sure you can actually afford it. So, let’s take a look at the real cost of leasing a car.
Car Leasing Deposits
When you are first looking into car leasing, you will notice that a deposit is needed as an initial payment. Saving up for this deposit will enable you to work out just how much you can actually afford to pay per month. If you try to save the most you can realistically afford each month, that will tell you how much budget you have for the monthly payments.
The cost of a deposit for a car lease deal is typically the same as 2 to 3 months’ payments. Therefore, it is important to ensure that you can afford that payment before you agree to a car lease.
Monthly Price of a Car Lease
After the deposit is paid, the next aspect of the car lease is the monthly payment. The actual price of this will vary wildly depending on the vehicle in question, but it will always be cheaper than a different type of finance option.
This is because you are specifically paying to cover the depreciation of value that the vehicle undergoes as you use it. That is why the price also changes depending on the limit in mileage that you choose, as well as the type of vehicle.
Therefore, make sure that you compare a number of different lease deals for the vehicle you are interested in. That way, you can check to find the deal that is best suited to your monthly budget.
Potential Additional Costs
The part of a car lease deal and contract that can often cause difficulties for people are the potential additional costs that you may face by not adhering to the rules of your lease deal.
For example, if you decide to end your lease early, there will be a penalty payment based upon how many of the monthly payments you have already made. Another aspect is that of the mileage limits.
If you go over the maximum limit of mileage permitted by your lease deal, you will have to pay additional funds. They will be calculated based on a “per mile” basis, meaning that they can quickly increase.
So make sure that you research each and every car lease deal for your desired vehicle to see what mileage limits there are. That way, you can find one that suits your needs and limit the likelihood of going over those limits and facing additional costs to your budgets.