How to negotiate a car lease deal

When auto leasing, the focus is to get a reliable car with an affordable payment plan. However, many people are not well equipped to negotiate a leasing deal to their advantage. The truth is that there are some leasing terms that can be negotiated. Below are some tips on how to get the cheapest lease deals.

Know the lease terminology

Understanding the language of leasing is the first step to getting a favourable deal. Here is a short overview.

Cap cost: this refers to the price of the car if you were to buy it.

Money Factor: this refers to the interest rate you are charged during the leasing period.

Residual value: this refers to the value of the car after the leasing period. It is calculated using the estimated depreciation rate of the car.

Acquisition fee: this is the amount you pay to facilitate the costs of organising a lease.

Buy-out price: this is the money you will pay if you decide to keep the car after the leasing period instead of returning it to the dealer.

Prepare to negotiate

Do comprehensive research on the best car to lease. Approaching a car dealer with a specific car in mind will assure you have a head start when negotiating. It communicates to the salesman that you are aware of the leasing process and you are not likely to change your mind when he/she tries to persuade you.

Negotiate on the cap cost

When engaging with a car dealer. It is best to negotiate the buying price of the car before disclosing that you want to lease. Make sure you get the best price for that car before you agree to lease. Also, research the average cost of the car by comparing the different prices quoted by different dealers online. This will help you discover when the cap cost is overpriced.

Negotiate the mileage limit

It is important to pay special attention to the mileage limit per year. The best way to approach it is to approximate the mileage you think you will cover and then negotiate for additional miles before you sign a lease agreement. This can help you avoid additional fees that are as a result of exceeding the set mileage limit.

Specify the leasing period

Terminating a lease term prematurely will attract a steep charge. To be safe, it is good to figure out the period of time you need the car.  Do not be tempted to lengthen the time of leasing so as to minimise monthly payments.

Look out for additional fees

After all the negotiations, you will have to sign a leasing agreement. At this time, go through the agreement carefully.  Make sure you understand every cost included. This will help you spot any additional fees you might not have noticed before.

Understanding the concept of negotiating a lease is very important. Leasing is an affordable and convenient option when it is approached in the right manner. What's better is the fact that you can always lease a new car at the end of every leasing period.