There are a number of car leasing traps you need to avoid when making the decision to lease rather than purchase a vehicle. Even though leasing a car instead of purchasing one has its advantages, there can also be some unexpected problems that can blindside you. Some examples of this are being hit with a large penalty charge at the end of your lease for exceeding the amount of miles the contract allowed you to put on the vehicle. Another all to common issue is the residual value if you chose to purchase the car at the end of a lease can sometimes be more than the actual market value.
If you are planning to lease, follow these simple tips:
* Do not accept a lease without first doing your research and homework. Visit a web-site called Leasewizard.com before ever visiting the dealership to find market lease costs for the car you desire to buy. Politely decline and ask for better terms should the dealer offer ones that are too high.
* Do not get an open-end lease. An open-end lease is one where the amount you owe for depreciation is the difference between the residual value and whatever the market value is when the lease has ended. Choosing a closed-end lease is a much better choice since you and the dealer agree on the amount you will owe before agreeing to the terms and signing the lease.
* Do not skimp on the mileage allowance. Most leases allow 12,000 miles a year and then require you to pay eight to twenty cents per each extra mile over this when the lease is up. This can be extremely costly. Purchase extra miles up front if you think you will drive more since it will cost about five cents a mile instead.
* Do not lease longer than the warranty period. Even though stretching a lease can decrease your payments, you will pay for any needed big repairs when the warranty period is up.
* Try not to buy gap insurance through the dealership. It is usually less expensive to purchase gap insurance from your automobile insurance company since this coverage pays the difference between the value of thevehicle at the time it is stolen or involved in an accident and the residual value plus whatever amount you still owe on your lease agreement.
* Do not keep the vehicle any longer than you want. You can try advertising the vehicle on Leasetrader.com if you need to get out of the lease for around $80.00. Each party will pay $150.00 when a buyer decides to take over the lease.
* Always read the contract and terms very carefully since a lease can spring surprises.
This story posted by LeaseTrader.com, the automotive service company that lets people transfer out of their Car Leases early. If you're looking to swap a lease or transfer out of your car lease, please visit www.leasetrader.com