Automobile leasing is becoming a popular method to finance a new vehicle.
While leasing presents no financial incentive over purchasing a vehicle, it provides consumers with several short-term benefits. For example, consumers enjoy low down and monthly payments and many enjoy the luxury of having a new vehicle every few years.
The decision to lease should incorporate reviewing several factors, including: how many miles you anticipate using the automobile and how you maintain the condition of a vehicle.
Every contract for a leased vehicle provides a mileage allotment. Many leases offer between 10,000-15,000 miles and charge approximately 10 to 20 cents per additional mile.
Under these conditions, if you lease a vehicle with a mileage allotment of 15,000 miles and you return it with 17,000 miles, you would be charged anywhere from $200 to $400 in extra mileage fees.
If you use a car sparingly and for only a few miles, leasing might be an attractive option.
If you commute and are always driving, you need to pay attention to mileage allotments and any associated penalties.
Another factor to consider is the general upkeep and maintenance of the vehicle. The leaseholder is responsible for the upkeep and can be assessed wear and tear charges for dings, scratches and stains. Do you drive your kids to sporting events and the beach?
Wear and tear damage assessments are the number one complaint received by my office associated with the return of a leased vehicle. Often lessees and lessors differ over the amount of damage and charges that are assessed.
To reduce this problem from occurring, I sponsored Assembly Bill 11096 which would require a lessor to do a “walk around” inspection for damage when the lessee returns the car. This “walk around” inspection will allow both the lessor and lessee to be aware of general damage to the vehicle and discuss any related concerns. In doing so, this legislation should reduce the amount of complaints associated with the assessment of wear and tear charges.
If you put a lot of mileage on a car and do not keep it in impeccable shape, leasing may not be the right option for you. If you decide to lease a car, it is important to visit several dealers and negotiate price. It is also important to review charges for early termination, end of term charges, how wear and tear charges are determined, the purchase option and option price and the liability on the casualty loss of the vehicle.
The Better Business Bureau serving Metropolitan New York, Mid-Hudson and Long Island maintains reports on various businesses, including automotive dealers. The report rates each dealer as either satisfactory or unsatisfactory based on information such as the number of complaints received and resolved. To use this service simply call your local Better Business Bureau office or access their Web site at www.newyork.bbb.org.