Leasing a car can be quite an exciting experience to lease a car, and rewarding too, if you manage to grab a lucrative deal. Car leasing companies in India have their own plus and minus points, and you surely don’t want to incur losses simply because you missed out on small details. Find out some of the DON’ts you should avoid when leasing a car :
- Don’t terminate your lease early- this can cost you a great deal. A leasing contract should be viewed as a rental contract. When renting a house, you have to usually sign a long-term contract and agree to pay penalties in case you do not hold up your end of the bargain. The same also applies to car leasing, in fact, it’s worse. Car leasing companies charge an early termination penalty that can go up to even thousands of dollars. You can hardly find any less expensive way to get out of your lease early. If you are soon to lease a car, ensure you can commit to the length of the lease and follow through accordingly.
- Don’t put a down payment or security deposit- if it is possible, always try to lease a car without a down payment. In case it’s unavoidable, it can be rolled into the monthly lease payment. This should primarily be done because, even though the insurance company will provide a payout to the leasing company in the event of your car being totalled or stolen, you will have to lose your down payment. Keep in mind that you do not own the vehicle, you simply “renting’ it from a leasing company. Your insurance company is under no obligation to pay anything if you lose your down payment. Besides avoiding down payment, you should also try to get your security deposits waived. Many car leasing companies in Mumbaiusually do so, and it might be accompanied by a slight increase in the money factor (interest rate). The security deposit should ideally be waived since you may never get it back when the lease period is over. The leasing company will either forget about it or try to take advantage by charging excessive wear and tear on the vehicle. If you do not pay any security deposit, you will enjoy a better negotiating position to challenge unnecessary charges.
- Don’t accessorize a leased vehicle- we understand you might have your heart set on those fancy wheels or a premium sound system, but you maybe financially in a vulnerable position by accessorizing your leased vehicle. Leasing companies have a limit on the retail value that they assign for each model. If you over-accessorize the vehicle, you will have to pay for equipment that you will use for only 3 to 4 years. Come to think of it, you are buying this stuff for the next person who will own the car, so give a good thought to which options you want to add to the vehicle.