Car dealers hate us... You'll Love us! Get A FREE Price Quote: Search CarBuyingTips.com Buying New Cars How To Buy New Cars Buy Cars Online First Time Car Buying Tips Hybrid Car Buying Tips Extended Auto Warranty Tips Canadian Car Buying Tips Top 10 Car Dealer Scams Military Personel Car Buying Our Reader's New Car Deals Auto Finance Auto Loans, Tips & Scams Auto Refinance Tips & Scams Bad Credit Auto Loan Tips Used Car Loan Tips Get Your Credit Report Online Car Insurance Buying Tips Used Cars Used Car History Reports How To Buy Used Cars Selling Your Used Car Used Car Classifieds Auto Auction Buying Tips Auto Leasing New Car Leasing Tips ALG Residual Values Car Leasing Software Reviews Government Sites Attorney General Sites DMV Sites - All 50 States Drivers License Sites Take A Break New Car Dealers - Ratings Rate Your Dealer Experience Free Spreadsheet Downloads Humor: Alternate Car Names RV Buying Tips & Scams How To Jump Start A Car LoserCars.com Crash Of The Month Gallery Furniture Buying Tips		Jeff's $avOmeterTM $10,180,056 Add your savings HERE!
	Leasing Part 6: Getting Out Of Common leasing dilemmas & money saving tips   In this Section: I'll provide you with several money saving tips to aid you in your leasing adventure, and explain how to get out of some common leasing dilemmas that people get themselves into. Then we'll examine what your options are when your current lease is about to expire. I also will point you to my Automotive links page, where you can surf to other free useful sights. Never enter a Balloon Lease! Balloon payments didn't work for mortgages and they don't work for leases either. With a balloon lease, your payments are artificially low at the beginning, but at some future date, you have to come up with for example, $6000, as one reader emailed me. The problem here, is people forget about the balloon, and structure their lifestyle and spending habits around their low monthly payment. Come balloon time, you're going to pop. Where are you going to get $6000? How many people do you know with $6000 in the bank. Balloon leases benefit only the dealer, because they sell cars quicker, due to the lower initial monthly payment. It's just not worth the risk. The dealers try to get you into these leases by convincing you that you'll be earning more money come balloon time, but truth is, people are getting divorced come balloon time, or had a kid, or lost a job, and few people have that kind of money. You are better off with simple, manageable, predictable monthly payments. Ask anyone who has even an adjustable rate mortgage, and they'll tell you what a pain those are. No Balloons! Got it? End of sermon. Lease Software with ALG Residual Values We like to use Expert Lease Pro because it's so simple. Choose your car from the menu. It lists the dealer invoice cost and MSRP for the base model and options. Check off the options and it supplies you with invoice and MSRP pricing. Select the sales tax info, and interest rate, and the software tells you what your payments will be. It's used by Attorney Generals to sue crooked car dealers. Don't lease a car for a term longer than the manufacturer's warranty! If anything goes wrong during the lease after the warranty expires, it comes out of your pocket. You're in a 39 month lease and your engine dies in month 37, your warranty is 36 months, you'll shell out $1200 to repair it. You are responsible for all damages, repairs, brakes, tires, and maintenance on the car during the lease. See if your credit union provides leases If you belong to a credit union, ask them if they provide leases. This can save you money because most dealers lease the car at full MSRP. Now you negotiate the price down on the car because you are buying it, and the credit union gives the dealer the cash, now they then lease the car to you. You'll save money because the car is now leased to you for less than MSRP, so the depreciation will be lower. Credit unions have lax mileage requirements, fees, and favorable residual values. It's worth looking into. Just because they write something down, does not mean it's true. Many people think that because it is written down it has to be true. The pen truly is mightier than the sword, and they use it to their advantage. They keep writing down figures, and you don't realize how powerful the written word is. They keep nibbling at your offer, bumping you up little by little, until you give in. But don't give in! Your advantage is you can just get up and leave. That is your powerful weapon. It may frustrate you to have to use it, but if the deal isn't worth it, walk away, no matter how bad you want the car. There will be other cars, other deals, and some dealer will be willing to work with you. There's no better feeling than having an uncooperative salesman call you back a week later and you tell him you signed the same deal somewhere for less. You can actually hear their jaw hit the floor. "You bought another car?!!!!" It really is precious. Avoid Long Term Leases > 36 months! Don't enter any leases for longer than 3 years. It's cheaper to buy the car than lease for more than 36 months. You may end up with a lemon, and you are stuck with it. You may lose your job, and the payoff penalties are stiff. Only lease for 24 months if you think you'll have kids and need to get out of the lease for any reason in 2 years. 24 month leases can be expensive, especially if they are back to back. This is because your insurance is more in the first 2 years, and you don't want to be paying all sorts of closing costs every 2 years. Also, back to back 24 month leases mean increased monthly payments, as you are now paying the bulk of the vehicle's depreciation in 24 payments instead of 36. This can be a costly way for you to lease a car, if every 2 years you start paying huge amounts of depreciation. But don't lease longer than 36 months because after that time, the leasing company may be expecting to see new tires and brakes on the car, and may try to bill you for them. Avoid 39 month leases. This gives the dealer with 3 more months of your money, while artificially making your payments seem less. Some buyers' brains trick them into seeing "36 months", when the are signing for "39 months", because they are only looking at the low monthly payment compared to buying. It's very sneaky because you are accustomed to seeing 24,36,48,60, so your eye only notices the "3", and your brain sees the 9 as a 6. In most cases, it's beyond the end of the warranty, and if anything breaks, you gotta fix it. How would you like to spend $800 on a new AC in month #37, when the lease is up in 2 months!

Look into leasing from a subsidiary of the manufacturer.
One reader leased a 1995 BMW 740I through BMW Financial that turned out to be a lemon. The car was in the shop so often that after one year BMW financial refunded three of months lease payments amounting to over $2400! But car problems continued and after six months they took the car back and replaced it with a new BMW 740I, with the same residual as his lemon BMW. Not a bad deal. Ask your leasing company what their policy is on lemons, if they have one.

Roll your security deposit into the next lease.
This will save you several hundred dollars in closing costs for the new lease and avoids the situation where the leasing company attempts to keep the security deposit. If you are leasing another same car from the same leasing company or dealer, ask them to waive the security deposit for the second lease. If they will not agree, "roll" the security deposit from the first lease into the second lease. If you have good credit, made all your payments on time, and returned the car in good condition, you should be able to convince the leasing company to waive the security deposit.

Use your security deposit to pay your last month's payment.
Most security deposits are equal to one month's payment. If your security deposit is equal to the monthly payment, do not pay the last payment on your present lease. But you must advise the lease company in writing, to apply the security deposit to the last payment. This is possible if you have good credit.

While you are paying off your current lease, start saving for your next lease!
Start saving $20-$50 a month extra to prepare for your next lease or purchase, so you will have more money to put down when the time comes. This should be worked into your budget, and NEVER dig into these funds.

Time your leases right and beware of 30 month Leases!
Did you wonder why 30 month leases usually pop up in December? If lease for 30 months in December, it ends in June, 2 1/2 years later, in the middle of the worst time to buy or lease a car, because it's not in September/October, when the new models come out, hence there's no closeout model bargain prices. 30 month leases are useful if you don't want to lease for 3 years<.

Avoid leasing after December 31.
If you want to lease in March, you are getting a car that is 1/2 model year old. The only time you want to lease is from September to December, or whenever the new model is introduced. Most cars experience the bulk of their depreciation in the first 24 months. So you can figure a car loses about 20% value after 12 months and 10% value after only 6 months, in my reasonable approximation. So if the new car comes out in September and you want to lease it in March, you are leasing a car that's worth 10% less than it was in September, even though it's a brand new car. Vehicles do decline in value. These are normal ALG residual values used to determine lease payments, so there's no way a salesman can deny that the car has dropped in value since September. The only time leasing after December 31 makes sense, is if the dealer is discounting the car significantly, at least 10%. In 6 months, the next year's new models will be out, and then your new car will have an ALG value of typically 82% MSRP, or worse if the car is not a historically proven high value car. If you lease it in March, the dealer is still charging most likely MSRP, so you are paying 10% too much for the car.

Always shop your leases around
Just because they write it up does not mean you have to sign. Dealers are arrogant these days and chances are they did not budge from MSRP. Ask them to give you a copy to study overnight. They may not, they don't want you shopping around. If they don't give you a copy, write down what you can, then go to the next dealer. Never sign a lease the first time they write it up unless your are absolutely sure you got the price that you want based on the knowledge I have given you here. If you still are unsure, then shop around. Tell them to save the paperwork and you'll be back. Of course they will do everything in their power to prevent you from leaving. It's a good thing you got your drivers license back, right? Believe me, they'll hold on to the paperwork if you tell them to. The deal will still be there tomorrow if they did not sell the car. If they feed you some BS about "this deal is only good today" Tell them "So is my offer", then run, don't walk out of that devilship. Oooops! I meant to say dealership.

If the dealer tells you there is no mileage charge if you buy the car at the end of the lease, this had better be in writing.

Don't give them your drivers license, SS#, or credit info UNTIL you have agreed to every number on the leasing form. They'll tell you they need them to get your credit processed, but it only takes 5 -10 minutes to print it out. They can wait until you verify numbers. Why give them this info if you walk out of negotiations? They can run a credit check on you after you leave, call you back to tell you they'll lower the price, you come back, and they start their scam all over again. They just want the info on you ahead of time to use it against you in negotiations. There's no reason for them to know about you until you have agreed to buy.

Lease a car that traditionally holds its value. Payments will be lower on a car with higher residual value (example BMW, Lexus) when the lease is up. This is because depreciation is less. Check out the automotive lease sites, and books for the residual values of leased cars. Don't get ripped off here, folks, make sure the dealer's residual value is equal to or greater than your sources, otherwise they are ripping you off. Also, look beyond the monthly payment at all the other fees.

Always do a sanity check on the money factor, converting it to equivalent APR. If they feed you some BS line about it being too complicated, remind them the law requires them to tell you in writing what the money factor is. To get APR, multiply the money factor by 2400. Here's some ranges of money factor/interest:

A huge red flag should go up if your money factor is .0075. This means the dealer is charging you 18% interest. So unless you have bad credit, the money factor should be .00333 or below. This is why they don't quote leases with interest rates. How would you know by looking at ".0075" that you were being taken for a ride, straight to the cleaners?

Let me repeat this point: Only lease a car with a proven track record of maintaining residual value. Know the residual of any car you plan to lease before you go shopping. Check out the Automotive Leasing Guides, and sites for the latest residual figures on your vehicle. Remember, the higher the residual value, the lower the depreciation, and the lower your monthly payments!

Never let your guard down for a minute. It's easy to do in a "No Pressure" type dealer. They act like they are being the most honest, up front people in the world. If they are trying to make you think they're honest, don't fall for it. They are probably getting you with a money factor equal to 18% interest, or they are hiding the fact that they are charging full MSRP.

Negotiate the price of the car as if you were buying it. During negotiations, if you switch from buying a car to leasing it, the dealer should still base your lease payments on the same price you negotiated for the purchase. However, in most cases, when you switch from buying to leasing, the dealer may figure your lease payment on the full "sticker price" not the lower price originally offered when you were going to buy the car. Therefore, make sure the price (capitalized cost) you negotiated is shown on the lease, and is the same as the price you negotiated if you first discussed buying the car.

If you trade in a vehicle verify the trade-in credit is subtracted from the capitalized cost of the car. The trade-in credit, and factory rebates or discounts should be subtracted from the price of the car you are leasing. Be careful here, they can get away without showing these numbers here, so watch closely. Any dealer that refuses to show you this or claims they don't have to because the law does not require it is just a class A loser. You should immediately get out of there, and email everyone you know so they will never lose any money to this dealer also. Federal law requires them to itemize the trade-in.

Just as in buying the car, don't take any of the extras like rust proofing on a brand-new car you only plan to drive for 3 years. Believe me, your car won't rust in three years. Definitely DO NOT buy the extended warranty, since you will only have the car 2-3 years! Remember you don't own the car, and you already have the benefit of the factory warranty that comes with the car. Don't pay for extras that you won't use. Remember, you can't use an extended warranty during the regular warranty period, no matter what anyone tells you.

Negotiate everything. Have a current car residual value book with you to lookup the prices and negotiate as high of a residual value as you can get. Also, don't for get to negotiate out the security deposit, bank fees, dealer service fees, etc. It's unlikely they'll drop the security deposit, though. These fees are just icing on the cake for them that would be better served in your pocket. Even the money factor should be negotiable. If you want to pay 8% interest, ask for a money factor of 8/2400=.00333. You can tell if they are trying to charge you 18% interest because the money factor would be 18/2400=.0075. A 2.9% interest rate would have a money factor of 2.9/2400=.0012. Now you can see the range of money factors from low to high. You should watch this number like a hawk and check all their math. Bring a calculator that does lease payments, and always have a money factor/interest rate conversion table handy. The problem is many dealers don't tell you what the money factor is, they lie about it, and you believe them because you don't know how to verify the numbers. Tell them to PUT THE MONEY FACTOR IN WRITING.

Don't let the dealer try to tell you the depreciation is calculated by subtracting residual value from MSRP. This gives them an excuse to put MSRP on your leasing papers, which you do not want. You will end up like Homer Simpson if you listen to the dealer.

Depreciation is calculated by subtracting residual value from the adjusted capitalized cost, which hopefully is lower than MSRP if you negotiated properly. Don't end up like Homer Simpson (Dooooooh!) If they base it on MSRP, you are paying more depreciation and thus higher monthly payments, which means more profit for them and less money in your pockets. Also, avoid as many extras as possible, as these increase your depreciation (by increasing cap cost).

Getting Out Of Common Leasing Dilemmas

Many people email me with some nasty situations they got themselves into while leasing so I listed these common dilemmas here, and the least painful workarounds to get you out of the mess. Read my online article about using the ALG Residual Values. You'll need it to calculate your lease payments, and look up dealer cost for cars and trucks.

Scenario #1: You recently leased a car, now you lost your job and want out of the lease.
This is a nasty one that happens to many readers. Your best bet is to just keep the car and try to continue making the payments, grin and bear it, until you find a job, because there is no way out. If you ran into financial hardship, do what you can to protect your credit rating. First, I recommend going to our free download area, and getting the Excel budget spreadsheet. Then enter all your current financial obligations and re-evaluate your current budget, finding places to cut costs. Don't stress out too much, take charge of the situation, get out there, visit some web sites on how to interview for a job and write resumes, and go get yourself a job.

If you turn in the car early, they will slam you with big penalties and there is no way out. Many people don't realize that if you terminate a lease contract, you still owe the leasing company the remaining payments plus early termination penalties, so you may as well stay in the lease, because you owe the money no matter what. Your first inclination might be to trade it in on another car, which is a bad choice. If you end up at an unscrupulous dealer, he may offer to payoff your lease "no matter how much you still owe". Also, they give you $4000 less for the car on the trade-in. So he pays off your current lease but you still owe all those remaining payments, and early termination penalties and all this gets financed into the next lease. Now you are paying off 2 cars, and you don't notice what they just did to you because they spread the payment out over 60 months to make the payments lower. On top of that, they tell you that they just saved you money. You think you're saving money, but they just screwed you, and now you are even worse off than you were before. Some salesman don't care you lost your job, they'll take even more advantage of your situation.

Another option you have is to get the lessor's permission to sell the car privately. To do this, you must get a loan to pay the early termination penalty, remaining payments, plus buy the car for the residual value. Then you turn around and sell it for market value, hopefully making enough to pay back the leasing company most of what you owe, and then pay back the bank for the loan you took out to buy the car. Most likely, though, you will end up losing some money, you'll still owe some money to the bank, and you won't have a car. But at least you won't have $450 monthly payments anymore. Then go out and buy a real cheap used car to get you through the mess until you get back on your feet. There's a lot of risk here because you don't know how long it will take to sell the leased car. Remember, there is no cheap way out of a lease. You are stuck!

If you must get out of your lease, at least trade it in on a car that is much, much, much cheaper than the car you are leasing now to make up for the loss you'll take on trading it in. Perhaps try a 5 year old used car, and this time, buy it, don't lease it, you do not belong in a lease. Don't buy any extras like window etching, paint sealant, fabric protectant, extended warranty, or credit life, and don't fall for their scam that the bank "requires you to buy these extras". If they pull that on you, go elsewhere.

Moral Of The Story: I can't stress this point enough. If you think your job is in any way in jeopardy, do not even consider leasing! You should have at least 3 months worth of lease payments in the bank or you should not lease a car.

Scenario #2: You are 1 or 2 years into a 3 year lease and you want out, or you are moving to another state.
This is a nasty one. Too many people lease a car thinking they can just move to another state with it or get out of the lease when they move. Your best bet is to just keep the car and try to continue making the payments, grin and bear it. If you ran into financial hardship, do what you can to protect your credit rating. If you turn in the car early, they will slam you with big penalties and there is no way out. A dealer may offer to payoff your lease "no matter how much you still owe", but he just pays off the lease and the remainder that you are upside down on gets financed into the next lease. If you move to a new state, the taxes are tricky because now your monthly payment changes. Another option you have is to get the lessor's permission to sell the car, and you just pay the early termination penalty, plus buy the car for the residual value. Then you turn around and sell it, hopefully making enough to cover the amount you owed. most likely, though, you will end up losing money. You can see these solutions are very tricky, as you try to determine which one is the least painful. Debt can only be created, not destroyed. Most leasing companies don't want you leaving the state with their car. Remember, you don't own it, they do. There may be more fees associated with moving if they even allow it, and there may be expensive registration for the state you are taking the car to.

Moral Of The Story: I can't stress this point enough. Leasing is not right for most people, so you must try to guess what will happen in 3 years. Will you be moving out of state or having a kid and needing a bigger car? Then don't lease. You may have no idea what's going to happen in 3 years. You could get divorced, lose your job, want another car, or be stuck with a lemon. At least if you bought the car, you could always sell it. Impulsive buyers seem to get caught up in this more often. If you get into a 24 month lease, your payments will be a little high but only for 24 months and then you will be back to 0 again. Actually Ford Motor's most popular leases are the 24 month types, but avoid doing them back to back. Whenever you buy a car, always leave at least 3 months worth of payments in the bank. If you can't afford to do this, you are buying too much car!

Scenario #3: Your lease ends soon and you realized you'll have 50,000 miles on a 36,000 mile lease.
There's a few ways to help yourself, none of them are cheap. At $.15 a mile, you'll have to come up with $2100 at the end of the lease, or just buy the car at the end of the lease, and there is no mileage penalty. First, start saving the money now, as any solution to this problem will cost you some. Estimate what your mileage will be at lease end and start saving the penalty. If you can't do that, go to a dealer and trade it in, lease another car, or buy your current lease to avoid the mileage penalty. Your penalty for trading early is the amount of negative equity in the vehicle. If you have too many miles on a lease, you can buy the car at the end of the lease for the residual value, then you won't have to pay the mileage penalty. But the residual value of the car might be more than market price of the car, so you could still end up losing.

Moral Of The Story: If you drive a lot of miles, you should not be leasing. You can purchase extra miles up front, but that just makes your lease more expensive, and you don't get refunded for unused mileage. Monitor your mileage and keep it under 1000 miles per month. If you go over, it's time to cut back on driving next month. Kind of a pain isn't it? Salespeople should not lease. They put on way too many miles. They may have a mileage package they can buy if they must lease.

Scenario #4: During the lease, you total the car in a wreck, or it gets stolen.
You'll have to wait for the insurance company to pay the claim. Your payments must be current to the date of the loss, and you must have paid all 'other' charges such as parking tickets, delinquent taxes, etc. You'll have to make the deductible payment to the leasing company if the market value of the vehicle were less than the balance. If there was still a difference, the loss would be written off, meaning the gap insurance would cover the rest. Once the insurance company pays the claim to the leasing company, the account should be closed and you can go get another car. Push the insurance company to get the claim settled ASAP before the vehicle is recovered. Insurance companies are very slow about paying claims like this.

Moral Of The Story: If you lease a car, make sure you buy gap insurance, but don't buy it from the dealer unless you like paying double. Buy it from your regular insurance agent. Most leasing companies require you to take out huge amounts liability insurance. Make sure you do not cut corners there. Find out ahead of time what you are covered for, and how your lessor handles totaled or stolen vehicles.

Scenario #5: You just signed a new lease, and a few days or months later you want out.
Oh, man are you in deep. There's not a thing I or anyone can do to help you. There are however, some tall buildings I could recommend to you to ensure that you don't survive the jump. People think that after a couple of months they can just get out of a lease. What you need to be aware of is that a lease is much worse than being married, it's a life sentence for the term of the lease. A LEASE IS A CONTRACT! The reason for this is the lease is a promise from you to the lessor that you will provide them with an agreed number of monthly lease payments, each containing profit for the lessor. If you try to get out of the lease, you are failing to honor your end of the contract and robbing them of their profit. It's like someone offering to buy your house, then taking the deposit check back because they realized they can't afford it. It will cost you big time if you want out unless the dealer wants to show you mercy (yeah, right). Maybe they'll take back the vehicle if you lease a more expensive one. Your payoff penalty could be in the thousands, and many times the dealers lie to you, saying early termination penalty is only $300. News flash: That $300 is just the Early Termination Payoff administration fee, not the penalty fee. Review the leasing glossary. They are just trying to prevent you from knowing what the real cost is, to prevent any second thoughts about signing the lease. Also, remember I mentioned earlier that they can pad your early payoff penalty because we don't know how it is calculated.

Moral Of The Story: If you are about to lease a car, make absolutely certain you are prepared to do so. Analyze the down payment and monthly payments and determine if you can afford them. You should have done it way before car shopping so that you already know how much you can afford. Don't sign a lease thinking you can fall back on the 3 day buyer's remorse right to cancel trick. Most states do not have laws that allow it, although many people think they do. As I stated before, folks, I don't answer emails with this question: I just signed a lease yesterday, why won't they let me out? Why did you sign it?

My lease is expiring soon, what should I do?

Now that your lease is coming to an end, you have some decisions to make. It's time to bring Supermobile LX back to my fictitious dealership Crazy Jeff's Automall. Do you want to buy the car from me or do you want to return it and lease another new car? If you were happy with your lease and you know you got a good deal, then maybe you'll want to lease again. If you want a new car every three years, why not just lease for consecutive 36 month terms? Your monthly payments will be less, but you'll have no equity in the cars. It's usually more expensive to buy the vehicle at the end of the lease, than the deal would have been if you bought it initially.

But if you really liked the vehicle, and it was trouble free, then it might be worth buying it. What you do, is compare the residual value (what you will buy it for) to the market value of the vehicle at the time. If the vehicle has a market value higher than the residual value, it's a good deal to buy it. You could even turn around and sell it for a profit over what you just paid off on it. On the against side, think about this: when a 36 month lease expires, your warranty does too, or sooner if you had a lame warranty. This is the time when things start to go wrong with cars, and it's like a domino effect. All of a sudden, you're paying $500 here, $700 there, your compressor goes, the alternator goes, your vacation goes. Now you have loss of time and car rentals when you could have just bought a new vehicle. If you decide not to buy car at the end of the lease, make sure there are no "end of lease" or disposition charges. Most leases actually charge these up front, so negotiate them out of your lease at signing. At this point, add up all the money you spent on the lease including all the up front fees and ask yourself were you happy. If you don't have a warm and fuzzy feeling, it may be time to buy a car instead. Hopefully this article will leave you with a warm and fuzzy feeling on leasing because now you know what pitfalls to watch out for.

Start checking out good car buying sites like InvoiceDealers, Cars.com, Yahoo!Autos, Autos.com, Edmunds.com, MyRide.com and CarsDirect

Remember the disposition fee?
The What? Many people completely forget about the disposition fee, or never knew about it to begin with, and if they leased before 1/1/98, it was buried in the fine print a the end of the lease. If you don't but the car at the end, you pay a disposition fee up to $400. Salespeople usually lie to you when you lease the car and tell you "Just return the car at the end of the lease and you owe nothing". If you decide not to buy the car, don't let them charge you more for the disposition fee than the lease contract calls out. Disposition fees are now required to be listed on the front page of the lease contract, so that you'll be aware of it's existence.

A Few Points To Remember If You Buy The Car At Lease End
Make sure they don't charge you more for the car then the residual value listed in the lease. A dealer tried to pull that stunt n one of our readers and luckily he had read this article before returning the car and put a stop to it. Also be sure they don't charge you more for the purchase option fee than what is listed on your lease contract. Make sure you have the contract with you so you can show them everything in writing.

Don't Tread On Me!
Leases usually require a good set of tires on the vehicle when you return it or they will bill you MSRP for a new set, whereas tire shops usually give discounts, so make sure the tires are in good shape, and your mileage is not over the 36000 mile limit. Make sure you do not have mismatched tires on the vehicle or they will charge you for new tires. I hope you saved all your maintenance records, in case they try to claim you neglected to care for their car.

Don't Forget Your Security Deposit
If you paid a security deposit to lease this car and you don't plan to buy or lease through this dealer for your next car, make sure you get your security deposit back in its entirety.

Excess Wear and Tear
Don't give them a reason to claim excess wear when you return the car. It's fairly cheap to it professionally detailed, vacuumed, waxed, and all the major stains shampooed out. The car looks better, and gives them less chance to claim excess wear. If the only damage your car has is a few minor scratches, tell them it's normal wear and tear for a car that age. If you really feel they are just getting greedy, and making up excess wear, tell them how upset you are. Tell them you are going to email the president of Supermobile, and tell them just how unsatisfied you were at Crazy Jeff's Automall, with Mr. Greedy's name mentioned in bold letters. Mention that you are going to tell the president that you are never again buying one of their cars, and you are going to tell every single person you know. Just make sure you are in the right before firing off an angry letter, and make sure it is professional while still getting across the point that you are angry. Make it short, and to the point, printing out on no more than a single page.

Leases have a lot of up front non refundable fees, that I feel could be better applied toward your equity in a purchase instead. At least you're getting something back when you buy. If you do move into another lease, make sure you can get a lease with true 0 down, and no more than 36 months. Too many people get antsy after a year and want out.

Loan/Lease Calculators:
Read my online article about using the ALG Residual Values. You'll need this vital data to calculate your lease payments, and look up dealer cost for cars and trucks. Every person who leases should be using the same type of leasing software that the dealers use. Without it you're sailing the ocean of confusion, and they'll swallow you whole. I would never in a million years lease a car without using my lease software first.

Now that it's all said and done, many people still argue with me, questioning why it's so important to negotiate the capital cost of the car. I can tell whose been conditioned by the salespeople already. A few people have asked me "Jeff, if the monthly payment is so low, why does it matter if the dealer charges MSRP?" This is just what the dealers want you to think. I'll tell why it matters:

Your payments could be even lower!

Make sure you practice with the lease software and my free Excel lease spreadsheet before you buy.

Don't consider leasing unless you understand all the concepts and have read this entire page!!

Check out How to read misleading ads
On this last page we'll examine some dealer ads that I've scanned in, plus I drew one up of my own fictitious dealership to illustrate how dealers can mislead you with newspaper ads. This is a must see so make sure you check it out. Then comes the summary and closing remarks, then your out of here!

Jump to any section. I suggest you read each chapter in order.
Part 1: Car Leasing Intro What leasing means, how it works, the advantages and disadvantages of leasing, and how to finance a lease.	Part 2: Leasing Glossary Glossary terms used in leasing, and how they are used against you so you'll be prepared for decisions in leasing your dream car.	Part 3: Lease Examples Real world leases with fees attached. A free Excel spreadsheet to calculate your monthly lease payments. How car dealers calculate lease payments.	Part 4: Web Sites To Use Reviews of discount car buying sites, determine how much dealers pay for cars, how to get ALG lease residual values. How to price your trade-in.
Part 5: Leasing Scams Federal leasing laws, and all the common car dealer leasing scams.	Part 6: Lease Dilemmas Money saving tips, getting out of common leasing dilemmas. What to do when your current lease is due.	ALG Residual Values Reviews of top leasing software and where to get ALG residual values. How to avoid lease payment scams.
CarBuyingTips.com

The information on this site is Copyright © 1996-2009 ConsumerNet, Inc. This site is solely for your personal use. You may link to these pages or print them out for your own personal use, but no parts of these pages can be reproduced, sold, or transmitted in any form without explicit written permission. By copying or paraphrasing the intellectual property on this site, you're automatically signing a binding contract and agreeing to pay a fee of $10,000 per instance per week payable immediately.