In the field of consumer auto financing, the option of leasing vehicles is widely misunderstood for various reasons. Auto industry analysts believe the history of auto leasing at the consumer level may be to blame for the myths, urban legends, and misconceptions that have formed around this financial practice. The first vehicle leasing operations in the United States were adopted by rental car and town car services. It is far more common to see drivers taking out loans with the hope their cars will last them a lifetime, which could be considered a financial myth. Here are five other myths associated with car leasing.
1. Lease Contracts Are Rigid and Cannot Be Negotiated
With the exception of auto parts, certain services, and snacks served at the cafeteria, anything offered by an American car dealership is subject to negotiation, including lease contracts. In a lease agreement, the dealer acts like a broker for the Orange County car leasingagency, which is more than often affiliated with the automaker. These business entities need income and cash flow, and they are willing to negotiate for the purpose of realizing both.
2. Only Certain Models Can Be Leased
As long as the car is new, an ambitious broker, dealer, or agency should be able to draw up a lease contract, which means just about any car on the lot is fair game. If a car with a specific trim package is not on the lot, a motivated lease agency would probably rush to make it available. It should be noted that the best lease deals are those that involve luxury and performance models that would normally require exorbitant monthly loan payments. In other words, it does not make a lot of sense to lease a Nissan Versa.
3. Leasing Involves High Taxes
Drivers who lease their vehicles only pay taxes on their monthly payments. They do not have to pay a sales tax on the price of the car because they are not buying it. Therefore, lease contracts feature less of a tax burden.
4. Buying Will Always Be Cheaper Than Leasing
Under certain circumstances, buying a car can be more affordable than leasing. For example, a Nissan-certified mechanic who buys a new Versa, drives it sparingly, and keeps it under a strict maintenance and service schedule will likely come out ahead financially if he or she intends to keep the car for a very long time. Drivers who are used to trading in vehicles for the purpose of signing a new loan will save considerably if they choose to lease instead.
5. Quoted Lease Prices Include All Costs and Fees
A few Orange County auto brokers and leasing agencies choose to list full prices with all taxes and fees included, but this is not a typical marketing strategy. Oftentimes, the sales representative on the lot will not be familiar with the full price, and this is something that should be discussed and negotiated with the finance manager.
If you’re looking to lease a luxury vehicle, get in touch with the trusted auto brokers at the Below Invoice. Call 949-630-0303 to schedule an appointment and start the search for your ideal car.