Which cars are best? What price to pay? What to watch for? Buying a used car may be the best option for someone who is looking for an affordable solution to their car needs. Elsewhere on this web site we’ve discussed the other options which include leasing a new car or taking over a lease from someone who needs to get out of their lease. However, a used car may offer the lowest cost answer, … Read More
The Secret to Cheap Auto Insurance
What is the Secret to Cheap Car Insurance? DISCOUNTS What types of discounts make for the lowest auto insurance rates? Most auto insurance companies offer a variety of discounts that can save you money on premiums. In fact, the difference between expensive and cheap car insurance can be the rate discounts that are offered. This is the secret to cheap car insurance. All discounts that a particular company might offer may not be available in all … Read More
How Much Car Can I Lease?
Know How Much Car You can Afford to Lease Knowing how much car you can afford to lease is important if you aren’t familiar with how lease payments are calculated. It also helps during negotiations with a dealer. Let’s say you know that you can afford $400 a month as a lease payment. Will that get you a BMW 6-Series Gran Coupe? If not, what about a nice Buick Regal? Or is it more likely to … Read More
Short-Term Car Lease Explained
How To Lease a Car Short-Term Car dealers don’t normally offer short-term leases on new cars. Nor do they lease used cars. They only offer new-car leases that typically start at 24 months. Leases for 36 and 39 months are the most common. If a shorter term, say a 1 year lease, is required, there’s another way to do it. We’ll tell you how and where. Why a Short Term Lease? There are many reasons someone might want … Read More
Off-Lease Cars – Explained
What is an off-lease car? Are they good deals? About previously leased vehicles When leased cars are returned to a lease company, the return is typically made to a new-car dealer, who handles the return for the lease company. The lease company is often the financial division of a major car manufacturer. Ford Motor Credit and Toyota Finance are examples. Generally, the lease company arranges for the vehicle to be transported from the dealer’s store … Read More
Best First Car – Which Cars Recommended?
Which car is best as a first car? What brand, model, style? When choosing a good first car, the many choices can be confusing and bewildering. Which brand is best? Which model? Which car is least expensive? Which costs less for insurance? Which car gets the best gas mileage? Which is the most popular with other drivers buying their first car? Our Recommendations Although we realize that there is no single “best first car” that … Read More
Car Loans – How Auto Loans Work
Car Loans – How Auto Loans Work How to borrow money for a car loan. Where to find the best rates and terms. Although this web site is primarily about car leasing, many of our readers tell us that they have decided that leasing is not right for them and that they will buy a car with a loan. They want to know if we have tips and advice that might help them. Hence, this … Read More
Lease Rate
The term, car lease rate, refers to the finance rate in a car lease. This rate is called, Money Factor, and is shown as a very small number, such as .00245, which is equivalent to 5.9% APR. Lease rate, or Money Factor, can be converted to equivalent interest APR by multiplying Money Factor by 2400. Or, if you have an interest rate and want to convert to Money Factor, simply divide APR interest rate by … Read More
Money Factor – Explained
The term, money factor, specifies a finance rate for a car lease. It is similar though not quite the same as interest on a loan, and expressed totally differently. Money factor, which is sometimes called “lease factor” or simply “factor”, determines how much you’ll pay in finance charges each month during your lease. The higher the money factor, the higher your monthly payment and the more you’ll pay in total finance charges. Therefore, when shopping for … Read More
No Money Down Car Lease
Car Lease With No Money Down? No Down Payment? Zero Down Car Leases Unlike car loans, most car leases can be obtained with no money down — no down payment. Along with low monthly payments and lower sales tax cost, this often makes leasing a brand new car much more affordable than buying. Whether you need to make a down payment (cap cost reduction) may depend on your credit score (see explanation below). Shoppers for car leases … Read More
Understanding Car Lease Deals
Is this a good car lease deal or not? Let’s look at an actual Honda car lease ad Here is a promotional advertisement a lease deal from the Honda web site. We’ll focus on the ad for the Accord Sedan for $199 a month, for 36 months, with $2499 due at signing. This ad is typical of most lease ads for other vehicle makes/models. Are these advertised lease deals actually good deals? How can you … Read More
Car Lease Interest Rate Explained
What is my car lease interest rate? Lease rate is not in my contract. How do I find it? It’s true. Unlike a loan contract, a car lease contract is not required to show the interest rate used in computing the monthly payment. And it isn’t shown. Actually, lease finance rate is expressed as money factor, not interest rate. And that isn’t shown in a car lease contract either. Money factor is a very small number. … Read More
Refinance Car Loan Explained
The term refinance is typically used in reference a car loan or home mortgage. It means getting a new loan to pay off an existing loan, at a lower monthly payment. Those who are interested in refinancing a car loan are looking for a way to reduce payment amount to better fit their budgets. Unfortunately, refinancing an auto loan doesn’t usually have the same large effect as refinancing a home loan. Refinancing only makes sense … Read More
Credit and Car Leasing – Explained
How Much Credit is Required to Lease a Car? Do I need good credit to lease? Credit requirements for car leasing are a bit different than for buying with a loan. Some people believe that leasing requires less credit than buying with a loan — because they equate leasing with renting. However, this is not the case. Leasing and buying with a loan are different in terms of the risk to a finance company or … Read More
Dealer Wants Car Back – What to Do
Dealer Wants Car Back – Wants More Money Can a dealer take my car back or demand more money? Is it legal? Yes. It happens every day. You buy or lease a car from a dealer. He calls you a few days or a couple of weeks later and wants his car back, or asks you to sign a new contract with higher payments. Is this a scam? Is it legal? Just the basics first … Read More
Auto Insurance for Teenagers – Explained
Teens and Car Insurance – How It Works and How to Get the Best Rates When teenagers first begin to drive, they quickly discover that auto insurance is and will continue to be a major factor — and cost — in their driving lives. First, they discover that it is required by state laws. In most states you cannot buy a car, get tags, or drive a car without at least a minimum level of … Read More
Car Lease Insurance – Explained
What auto insurance is required to lease a car? Most car lease companies require you to maintain full-coverage auto insurance to protect both you and themselves. This means both liability and collision/comprehensive coverage. The details of exactly what and how much is required is specified in the small print of your lease contract. Specifics can vary by lease company. The amount of coverage specified in your lease contract is a minimum required amount, and is often … Read More
Upside Down Car Loan – What To Do
Upside Down Car Loan – Negative Equity Loan The term upside-down generally refers to the situation in which a car buyer owes more on his auto loan than his car is worth. Being upside down causes problems when trying to sell or trade a car, or when a car is destroyed in an accident. The amount by which his loan balance exceeds the car’s market or trade-in value is called negative equity, or negative ownership … Read More
Spot Delivery – Explained
The term, spot delivery, as it relates to car leasing and buying, refers to a practice by car dealers that is perfectly legal but often causes problems for customers, especially those with poor credit. To understand spot delivery, it is necessary to understand that car dealers don’t provide loans and leases, and can’t approve customers’ credit, even though they often give the impression that they do. Actually, when a customer needs a loan or lease, … Read More
Texas Auto Lease
Why Car Lease Taxes are Bigger but not Better in Texas Lease a car in Houston, San Antonio, Austin, or Dallas, or any other city in Texas and pay full sales tax In most states, sales tax is paid on monthly lease payments, not full vehicle value. Not in Texas. Maybe the philosophy is that bigger is better. But that is not the case with leasing and taxes. Texas laws require that the lessor (the … Read More
Car Leasing: Recommended Reading
Car Leasing: Recommended Reading For automotive consumers who are about to lease a car, we recommend the following articles on the LeaseGuide.com web site: Preparing to Lease a Car Car Lease Fees, Charges and Taxes Car Lease Contracts – How to Understand Them How to Negotiate a Car Lease Cheapest Cars to Lease in 2021 Lease Deal Calculator – 2021 Car Lease Payment Calculator – 2021 Car Lease Kit – 2021 Version
What Is the One Percent Rule in Car Leasing?
A Simple Way to Determine if a Lease Deal is Good or Bad We often get the question, “What is the 1% rule or method of quickly evaluating a car lease deal?” To determine if a car lease payment is a good deal, it’s best to examine each of the major components – cap cost, residual, and money factor – separately. However, in many cases you may not have this detailed information and must do … Read More
Real Car Leasing Example Explained
How Car Leasing Works – Example Lease Deal One of the best ways to learn about car leasing (and most anything else) is by example. A comprehensive easy-to-understand example illustrates how it works with explanations and numbers. Finally we describe, with example, how to determine if the deal is good, or not. Average Car Lease Example Lets’s assume we want to lease a new car for 36 months (the Lease Term), at 12,000 miles a year, that … Read More
Clearance Sale
The term, clearance sale, as it applies to car sales and leases, refers to the end-of-model-year sales conducted by car dealers to help sell (or lease) remaining current-year inventory of vehicles. Dealers don’t want to be caught with too many of the old models when new models begin arriving. Car clearance sales are often held as much as three months ahead of new model arrivals. Or, if dealers still have significant old-model inventory after new models are already on his … Read More
Smart Car Safety – Smart Parents
Cars have become much smarter and safer in just the last few years with safety features that are sure to save lives of drivers and passengers. Parents are especially appreciative of the these features that help protect their “precious cargo.” It’s important to note that automobile safety features fall into two categories: 1) those that help survive an accident, such as airbags, and 2) those that help prevent an accident, such as a collision avoidance … Read More