Leasing a car can be of great use to someone in need for transportation for a limited amount of time. The biggest challenge is finding the best car lease program. There are some many lease offers out there, it’s easy to get confused and have no idea what to pick. The best treatment for confusion is research, so head on to man’s “best” friend: Google, and start searching. There are hundreds of websites such as the KBB (Kelley Blue Book) or Edmunds that not only provide reviews, but also have automatic online tools that could help you determine your lease payments. KBB and Edmunds also have the most popular and trusted systems for determining the used market value of a car.
The KBB Value System or Edmunds True Market Value System should become your best friends because the next step is finding a car with the higher residual value. That is the car you should lease. The residual value basically is the price of the car at the end of the lease. For example: leasing a car for two years means that you use the car and afterwards bring it back to the dealership. During this time the car depreciates and suffers a dramatic drop in value. So the idea is that the higher the residual value, the less money you are going to pay for it. By now you should know that your monthly payments represent the car’s estimated depreciation divided by the number of months you’re leasing it for.
These are the steps that should guarantee successful research and the best lease program.
First of all, get your credit score. You can acquire a credit report from each of the three major credit agencies: Experian, TransUnioun, or Equifax. Make sure you check the report carefully. Then try as much as possible to correct any inconsistencies your credit history might have before starting the lease process. Remember that the higher the credit score, the better the deal you can get. A good clean credit history will get you in the best car lease deal.
Afterwards, you need to determine your purchase criteria. Pick a few cars that have similar price and features. This will help you branch out a bit and cover more ground in the “what car?” department. If you’re searching by price then you should follow the MSRP. This is a great starting point in determining the overall costs of the car.
As we’ve stated before, a car with high residual value will provide a great advantage for you since it has considerable effects on any lease. Keep in mind that common vehicles, also known as “economy sizes” will have a lower residual value. On the other hand, a luxury vehicle, or an exquisite brand like: Mercedes, Audi, VW and such, have the power to hold on to their value over time. On the other hand, such vehicles start with a high MSRP value so you need to be careful. On such a fluctuant market, cars have different depreciation values that can go up to 30% of their MSRP value in the first year, and an additional 15% in the second year.
And finally, you need to indentify the type of lease. You can either pick the closed or open lease deal. The closed end lease means that the car’s depreciation is calculated at the beginning of the contract. When the lease is over, you bring the car back, you pay for excessive mileage (if you have it) and that’s it. The open end deal calculates the residual value at the end of the lease.