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Benefits Of Leasing

(category: Auto-Leasing, Word count: 468)
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Despite aggressive low-interest financing, cash-back offers and other

purchasing incentives offered by leading auto-makers to buyers, leasing

numbers keep increasing steadily over the years. Leasing is not only an

attractive financial proposition to most auto-consumers, but also a

lifestyle and preference choice.

Benefit Number 1: Keeping up with the latest trends

Leasing is sometimes more of a personal and lifestyle choice than a

financial one. Many people are not comfortable with the idea of owning a

vehicle over a long period of time. They'd rather keep up with the latest

trends of the industry and drive the latest models every two to three

years.

Leasing a car gives you the convenience of having the latest technology

and safety innovation, such as an electronic stability system, DVD

entertainment systems and advanced stereo equipment. If you are willing to

forego ownership for the latest set of wheels, than leasing is your best

option.

Benefit Number 2: Purchasing Flexibility

Leasing also offers purchasing flexibility: it allows you to defer the

purchasing decision while using the car. You don't have to haggle with your

mechanic over repair expenses, deal with hefty maintenance bills or worry

about a depreciating asset. Provided you can keep the vehicle in good

condition and stay within the contracted mileage allowance, you're

effectively getting a test drive for the length of your lease.

At the end of your lease, you can purchase the vehicle or simply turn in

the keys and walk away. No questions asked.

Benefit Number 3: Cash Flow

Leasing offers many short-term benefits. It reduces your initial cash

outlay as you do not have to pay the large down payment required for car

ownership. You only pay for the depreciation on the car - only the part you

will use during your lease, not the entire vehicle. This results in lower

monthly payments and frees even more cash. This cash can be put to use more

intelligently elsewhere than the questionable investment of owning a

depreciating asset. If you are self-employed or use your car for your job,

then you can write off your leasing payment as a business expense.

Benefit Number 4: Negotiating Leverage

Although it may seem a little unorthodox in this industry, almost

everything about leasing is negotiable. If you know all the fees involved,

you can lower your monthly payments, negotiate the purchase price of the

vehicle at the end of the lease and contract additional miles on top of

your mileage limit. You can also do some shopping around and compare deals

from different auto-insurers to get the cheapest GAP insurance for your

lease.

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Auto Insurance And Leasing

(category: Auto-Leasing, Word count: 233)
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When leasing a car, it's easier to stick with the same company for your

auto insurance. What you don't know, however, is that you may end up

paying too much for your coverage and it's better to look elsewhere for

lower rates.

When you lease, the vehicle that you will drive belongs to the leasing

company. They want to make sure that their investment is covered in the

event the vehicle gets damaged, totalled or stolen. They typically want

to get covered for the difference between what your auto-insurer pays and

your outstanding leasing obligations at the time of the accident or

damage. This is called GAP, short for Guaranteed Auto Protection, and is

usually included in the leasing contract.

If your leasing company is called BMW Financial Services, Chrysler

Financial or any other finance division of an automaker, then chances are

your GAP insurance will be offered by the same lease company.

You are under no obligation to accept GAP insurance included as part of

your lease agreement. Why pay an insurance premium if you could get the

same coverage for a lower price?

Invest some time shopping by comparing quotes from other insurance

companies, including your existing one. Ask for discounts that you already

qualify for and adjust your coverage accordingly.

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Fees Involved In Leasing

(category: Auto-Leasing, Word count: 220)
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Mention auto-leasing and most people will automatically assume a low-

monthly payment. There is actually more than what meets the eye, and a

number of fees are involved at various stages of the lease process.

At the beginning of the lease, you have to pay a refundable security

deposit, typically equivalent to one monthly payment, to safeguard against

non-payment and any incidental damage done to the car at the end of the

lease. You are also required to pay an administrative charge, called

acquisition fee. Other fees include licenses, registration, title and any

state or local taxes.

During your lease, and you expected to honour your monthly payment

obligations. Any failure to do so will result in late-payment charges.

You have to pay any traffic tickets, emission and safety inspections and

ongoing maintenance costs. Ending your lease early will result in

substantial early termination charges.

At the end of the lease, expect to pay any excess mileage costs, charged

at 10 to 20 p a mile. Any incidental damage done to the car, and deemed to

be above normal, will result in excess tear-and-wear charges. Finally, if

you choose not to purchase the vehicle, then you have to pay a disposition

fee.

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Using Lease Calculators

(category: Auto-Leasing, Word count: 242)
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Want to calculate your monthly lease payment? Consider using a lease

calculator

If you are considering a car lease, then you might want to know some key

figures involved in the deal: the monthly lease payments, the overall cost

of the lease and how much savings can be made compared to purchasing the

vehicle.

A lease calculator relieves you from the stress of having to know the

complex underlying lease formulae used in calculations. You simply plug a

number of figures into the calculator and hey presto! You get a detailed

rundown of detailed payments, taxes and total lease costs.

Figures you need to get from your dealer about a specific lease you're

interested in include: capitalized cost, estimated residual value at the

end of the lease, the number of months in your lease and the money factor.

Make assumptions and change some of the figures to see how it affects your

lease payments. For instance, residual value is an "estimated" value of what

the vehicle will be worth at the end of the lease. You can input different

estimates to cover different scenarios and assumptions.

As a final note of caution, bear in mind that lease calculators only do

calculations and check the accuracy of abstract mathematical formulae. They

do not tell you whether a lease is good or bad.

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Luxury Cars And Resale Values

(category: Auto-Leasing, Word count: 202)
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When it comes to ultra-luxury, high-end vehicle leasing, there is no doubt

that the best deals are those cars that hold their value. With this in

mind, we single out a few truths about residual values that consistently

apply to high-end leasing.

The most determining factor when it comes to resale values is public

perception of the brand, not its reliability ratings in quality surveys.

Take the Jaguar for example: it is consistently rated as a quality car, but

because of questionable reliability perception among the public, it takes a

sharp dip in value at the end of its lease-term

Higher-tech options and other cutting-edge features do not necessarily mean

the car will fare better. By the time your car is two years old, better

and cheaper systems will render the laser-guided cruise control, navigation

systems and built-in cell phone obsolete. Look for functional features,

such as automatic transmissions, power windows and wheel-drive to enhance

the vehicle's value in the used-car market.

Used-car buyers view less favorably luxury vehicles that come with big

incentives. These are perceived as questionable in quality and

reliability.

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How To Spot A Good Car Lease

(category: Auto-Leasing, Word count: 479)
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Leasing has been lauded as your cheapest ticket to keep up with the

industry's hottest vehicles and trends. The jury, however, is still out

on leasing: with the industry long on hype and short on detail, it is

difficult to distinguish between a genuinely good deal and a downright

up-selling exercise.

So how do you spot a good deal?

First, you need to find out if there are any down payments on the lease. A

down payment refers to the lump sum amount that you pay upfront, either in

cash, non-cash credit or trading allowance, to reduce your monthly payment.

You should think twice before putting money down on a lease: not only are

you getting a rough deal, as you're essentially forfeiting the general rule

of leasing: not putting any cash upfront, but the money is not recoupable

at the end of your lease. There is another big disadvantage: in the event

of your car getting damaged or stolen, you insurance and the gap cost will

not cover the loss.

Mileage Limit

Most leasing companies allow you a limit of 45,000 free miles over the

length of a 3-year lease. This may seem like a good deal at first sight,

but when you consider it only comes to 15,000 miles over a 12 month period

it's not difficult to foresee why it might be difficult to stay within this

limit. Even people working from home have little trouble putting 15,000

miles on their cars.

If you exceed the mileage limit, the penalty for each excess mile can be as

high as 20 cents. This can add up quickly over the length of your lease: an

additional 4,000 miles a year over the length of a 3-years lease contract,

will end up costing you an extra $2,400 in excess mileage charges!

Be realistic about your mileage needs, especially if you have to regularly

commute over long-distances, before you sign the contract. Consider padding

the miles that you expect to use since it is less expensive to contract for

the extra before you sign than it is to pay the extra charges at end of

your lease.

Sales Tax

Sales tax is usually capitalized and added to the monthly payments.

However, some dealers choose not to include it in their calculations to

drive the advertised lease payments even lower. What they do instead is

state in the small print that the monthly payment excludes "sales tax".

Make sure you carefully read the fine print for any extra, hidden costs not

included in the advertised monthly payment. Unscrupulous fees that

typically slip through the cracks include sales tax, registration and title

fees.

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Auto Leasing Scams

(category: Auto-Leasing, Word count: 536)
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Car-leasing has been lauded as a more attractive alternative to buying,

offering in the process the flexibility to drive a new car for less. The

reality, however, is that leasing is an option that is fraught with many

pitfalls for the average customer. Leasing regulation does not require as

much disclosure as buying a vehicle. This has given rise to many leasing

scams that trick the customer into believing they are into a good deal

when, in effect, all he is getting is a rough deal on the dealer's terms.

Here we look at some of these common scams and how to avoid them

Artificially low interest rates:

Some dealers quote a lower interest rate when in reality it's much

higher. They do this by either purposefully quoting the money factor as

the interest rate or calculating the loan without amortizing some closing

fees, like the security deposit, into the loan lease. Take the money

factor for example: this is typically expressed as a four decimal digit,

something like 0.004. Some dealers quote this as a 4% interest rate when

in fact you need to multiply it by 24 to get a rough idea of the interest

rate on your loan. In this example, the interest rate is a much higher 9.6%

than the "quoted" rate of 4%.

Make sure you crunch the numbers and understand the formula they use to

calculate their interest rate. Look out for any fees not factored into the

calculation. If you are not satisfied, do not enter into the lease

agreement.

Terminate your lease early for a low penalty

This is an all-time leasing scam. You ask your dealer how much you will pay

if you want to terminate your lease and he tells you: "You want to get out

early? Sure thing, you only pay an early termination fee of $300?. What he

is quoting is only the small administrative penalty of early termination,

there is a much stiffer penalty called early termination fee and this runs

into thousands of dollars.

Do not confuse the early termination administrative penalty with the

termination fee. Read the small print carefully and know exactly how much

you will get charged should you terminate your lease before its scheduled

end.

Pay for an extended warranty you don't need

This is another shell game to inflate the dealer's profit at your expense.

The dealer slides an extended-warranty into the deal whilst it's already

factored into the monthly payments, or he tricks you into buying a 36-month

warranty on a 24-month lease.

You do not have to pay extra money for a warranty already built into your

payments or for one that goes well beyond your lease term.

They might slip an extended warranty in. Don't be fooled, the warranty is

already factored in.

No security deposit

Any dealer who advertises a $0 security deposit is not telling you the

whole story. A security deposit is always factored in the lease under the

provision for disposition fees.

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Go Green And Save On Your Lease

(category: Auto-Leasing, Word count: 203)
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Hybrid vehicles' popularity has sharply grown from a couple of thousands

in early 2000 to close to 300, 000 by the end of 2005. The trend is

rapidly catching with the auto-leasing industry with generous tax credits

and incentives on offer if you go green.

Beginning in 2006, businesses and taxpayers who lease, or purchase, an

environmentally-friendly and fuel-efficient vehicle will be eligible to

claim federal income tax credits worth thousands of dollars. Individual

states also offer generous incentives, including hybrid state tax credits,

new High-Occupancy Vehicle (HOV) lanes access and discounted thruway tolls

for alternative-fuelled vehicles.

And that's not all you can save from going green! You can now save on your

parking fees at a number of universities and some auto-insurance companies

are offering insurance discounts for hybrid-vehicle owners nationwide.

If you want to take advantage of these incentives and contribute to energy

conservation then visit HybridCenter.org and complete a personal profile

about your driving needs and habits. You will get in-depth advice on hybrid

models that would make economic sense to you and local, state and federal

incentives available where you live.

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Leasing With Bad Credit

(category: Auto-Leasing, Word count: 250)
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Have you been refused a car lease? Chances are you have less flawed credit

history. Know what's involved and what you can do to build good credit

history.

Credit score is a measure of your credit worthiness used by leasing agents

to determine whether you are eligible for a lease. You credit score is

based on your past and present credit history, and can range anywhere from

350 to 850. A measure above 720 is considered a "prime score" and will

land you the best rates. If you are below 640, then you are "sub-prime"

and will be considered bad rating by the bulk of leasing agents. This is

where all the trouble in getting that lease comes from.

Ask for your FICO Credit Score from the Fair Isaac Corporation (FICO)

which details your credit score held by all three leading credit score

agencies in the country. Compare the three credit scores and determine if

any agency is holding erroneous credit data about you. Contact the

reporting agency and getting corrected.

If there are no mistakes in your credit report, then you can take some

steps to maximise your score to go above the threshold of 640. Pay your

bills on time and pay down any credit card debts you have. Do not take any

new accounts as this might increase the likelihood of you getting into bad

credit thus worsening your credit score.

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