Interested in learning more about car leasing? Talk to the experts at EJ Klassen Motorcade.

Understand Your Credit, Part 5: Leases

MTYH: Price is different from a purchase to a lease. THE PRICE IS THE EXACT SAME

Leasing a vehicle is incredibly common in urban areas where the volume of kilometres you travel is limited and that likelihood that you will travel extremely long distances is remote. Look at what you are driving today and how long you have owned that vehicle. If the kilometres used are over 25,000 a year, leasing may not be for you.

When you lease a vehicle, your car becomes a monthly bill not unlike your cell phone or gym membership. Remember you do not own this vehicle. You are using a vehicle that you must return or buy out at the end of the term. There are conditions attached to returning the vehicle; scratches, rips and tears, damage or excessive kilometres all will cause you to incur costs when you return the vehicle.

Where you may finance a car over six years you can lease two in that time frame. Most comprehensive warranties that come from the manufacturers are most often a three-year or 60,000km term. As such, a three-year lease means you are using the vehicle over the period where it is the most protected.

When you are going to lease your new vehicle, make sure that you have any accessories you’re wanting installed added to your lease so they can be a part of the process. Don’t be afraid to say things like, “if you include floor mats I will sign today.” Go over all the details of the items on the lease and make sure they are accounted for.

Leasing is a form of credit. You will need to get a credit check done. Contacting Equifax or TransUnion in advance will help ensure that there are no surprises. Your score will determine your final rate.

When you have a lease, you will be paying in advance so your first payment, fees and taxes will be due that day along with getting your vehicle insured and plated. Make sure you have the funds ready to make those payments.

Before you take final delivery of your vehicle, make sure all of your accessories and listed equipment are installed. Check it over for blemishes and make note of the volume of kilometres. Make sure the kilometres match your lease documents and any protection programs you may purchase.

Remember, this is your credit, your money and your future. There are no silly questions. Read contracts, read pamphlets. Ask questions, ask for clarification if you do not understand something. Credit is potentially a long-term commitment; knowing what you are signing up for is important.

Feel free to come by anytime and we would be happy to look at your situation and see what we can do.

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