How does leasing a car work?
Since posting my first YouTube car video about how to negotiate a lease in 2018 I’ve responded to hundreds of comments and questions. I’ve distilled those questions and answer them in this video from my experience as a former Mercedes Benz car salesman.
What are the questions new car buyers have on the topic of leasing? I expand on each question below with more detail in the video:
Is leasing a rip off?
No.Leasing is managed ownership. Leasing is a tool that is best for some, but not all car buyers.
Can you lease without a down payment?
Yes. Some dealers will require a down payment based on the car buyer’s credit worthiness. Buyers with credit scores above 680 usually have no problems leasing. Buyers with credit scores below 620 usually have problems.
Is negotiating a lease the same as negotiating a new car?
Yes. Negotiate new car price first as you would a new car before negotiating the terms of the lease. I explain how to best negotiate new car price in this post as well as on my YouTube channel notwaitingtolive.
How do you negotiate a lease?
There are four (4) components of a lease that affect the payment:
1. Down Payment
2. Depreciation Payment
3. Sales Tax Payment
4. Rent Charge
I explain how each of these components relates to leasing in this video as well as my video about how to best negotiate a lease.
Is it true dealers don’t discount leases?
You should not pay a higher price for leasing a new car compared to buying a new car. The rent charge/ interest rates however will likely be different.
Can you lease a loaner or demo car?
Yes. These are the best lease deals of all.
What are the fees associated with leasing?
Acquisition fee: ~$500-$900
Document fee: ~$0-$700
Registration & Title fee: ~$15-$200+
Lease Turn-in Fee: $0-$500 (Refuse to pay this!)
What credit score do you need to lease?
Buyers with credit scores above 680 usually have no problems leasing. Buyers with credit scores below 620 usually have problems.
How do you lease as a business?
Your business needs to have established a relevant credit history with usually at least 3 lines of existing credit. Your business Dunn & Bradstreet score is required to lease. If your business does not have a Dunn & Bradstreet score it’s likely not in a financial position to be approved to lease a vehicle. Authorized representatives of financially qualified businesses can secure a lease with notarized documentation validating their authority and the businesses Employer Identification Number (EIN).
Can I trade in my lease early?
Maybe. Some dealers and manufacturers will provide incentives to make the final few payments of a lease. This usually would not exceed much more than 3 months in advance of the end of the lease contract.
Can I cancel a lease?
Maybe. This will vary from dealership to dealership and likely only possible within the first 7 to 30 days. You’re best chance is to clarify this possibility with the car dealer before you commit to the lease.
What else do you need to know about negotiating the best car price?
You don’t know what you don’t know. On my YouTube channel and car blog I’ve created all the self help videos you need to negotiate the best new and used car prices on your own for free.
But I know people will still pay for help buying a car for 3 reasons:
Save the stress, anxiety, an uncertainty of negotiating on your own
Learn from someone with experience negotiating the best car prices
Save time buying the right car for the best price
If you fall into one of those three categories you can get my car buying help by following this link: https://notwaitingtolive.com/help-buying-a-car/
I recommend the following videos to best negotiate your next vehicle purchase.
How to Make Lowest Initial Offer in Used Car Negotiation
How to Make Lowest Initial Offer in New Car Negotiation
How to Best Negotiate Used Car Price
How to Best Negotiate New Car Price
How to Best Negotiate a Lease
How to Lease a Car (11 Frequently Asked Questions)
How to Negotiate by Email
Cash Buyers Pay More (What to Say to Save Money)
Online Car Buying (How Much Are You Overpaying?)
The Story of the Biggest Discount I Ever Gave As a Car Salesman
How Much Car Can You Afford? (The #1 Rule to Know)
5 Myths About Buying at the Car Dealership
How to Sell a Car For Sale by Owner
Buying a Car Out of State (4 Things to Know Before You Go)
New vs Used vs Very Used (What’s the Real Cost of Ownership and Best Time to Buy?)
Scotty Kilmer 5 Used Cars You Should Buy
What Happens to Unsold New Cars