You may feel like you are looking forward to contacting the leasing company to discuss a car leasing buyback, but take a moment to pump the brakes. According to consumer advocates, the first step could exceed your chances of negotiating favourable terms. You may not know it, but the two usual ways to finance a car are contract personal rent (PCH) and personal contract purchase (PCP). PCH Leasing allows you to drive a new car every two years, with relatively low monthly payments and not worry about the resale value of the car. PCP is similar, but gives you the opportunity to buy the car in the future. If you rent a car, there are strict rules and restrictions, so make sure you understand how it works. This option is ideal if you don`t have a big cash crisis, but you want another vehicle, for example, if you rent a luxury SUV, but prefer a smaller and more economical sedan. If you have lingering doubts, buying your rented car at this point may not be the right step. Returning the vehicle before the lease expires is an option, but not a good one. They are always on the hooks for all remaining payments, plus large fees and penalties for early termination.
Make sure you have a copy of the credit contract or desacht with all the signatures and conditions fulfilled before you leave the store. Do not accept documents later, as documents may be misplaced or lost. Exceeding mileage limits for your lease can cost you 10 to 15 cents per mile. The dealer will inspect your car just before the lease expires, and you will also be charged for excessive wear. PCP is similar in many ways, but you can buy the car at the end of the deal. If you arrive late with your car payments or in some states, if you do not have the necessary auto insurance, your car could be taken back in possession. The creditor can recover the car or sell the car and apply the proceeds of the sale to the remaining balance due of your credit contract. If the car is sold for less than what you owe, you may be responsible for the difference. Renting a car brings a variety of benefits, including a minimum deposit and generally lower monthly car payments than a car loan.
As an added bonus, you get a shiny new car to drive every two years when rents expire. Of course, these potential benefits are only part of the equation. For most drivers, the most important question – after “Do I want a new car?” – is whether the purchase price is a good deal. The majority of leases include a “buy-back price,” the amount you have to pay if you want to hang on to the car.