 Is your contract for a Closed-End consumer lease — not an Open-End or Commercial lease? |
| Is the date on your contract correct? If not, you could get shorted on your lease term and get a surprise early return notice. |
| Is the description of the vehicle legally correct? Correct year, make, and model? Is the Vehicle Identification Number (VIN) correct? Incorrect VIN is a common contract mistake. |
| Is the vehicle’s optional equipment listed correctly? You would not want to be charged at lease-end for removing a piece of equipment, such as a upgraded stereo or nav system, that wasn’t there when you took possession of the vehicle. |
| Have you inspected your vehicle for damages, paint blemishes, scratches, dents, chipped glass, non-working equipment, or missing parts, such as spare tire and jack? The lease company will make you pay for these at the end of your lease if you don’t have the dealer remedy them now. |
| Is the vehicle’s initial mileage stated correctly? These are miles you should not have to pay for at the end of the lease if you exceed your allowed mileage. |
| Is the term “excessive wear and tear” defined in detail in your lease contract? Is it clear? Do you understand it? |
| Is there a “return disposition” fee specified in your contract? If so, this is normal and is to be paid if you return your vehicle at lease-end. The amount of this charge is typically about $250-$450. Don’t let a dealer charge you more. |
| Is “gap protection” included in the lease? Look at the “loss waiver” section of your contract that describes your responsibilities if the vehicle is stolen or destroyed. If it states that you will owe no money after insurance and deductible has been paid, you have gap protection. If you don’t have it, ask your dealer if can you buy it separately. It’s important to have when leasing. |
| Do you have the option to purchase your vehicle at the end of the lease (make sure it’s in writing in the contract)? If you think there’s a possibility that you’ll want to take advantage of this option, make sure your contract specifies the price. It’s possible that there is also an additional purchase option fee. This is normal. |
| Is the statement of your annual mileage limit correct (typically 10,000, 12,000 or 15,000 miles)? Is the per-mile charge for excess miles stated clearly and correctly? The charge is typically in the range, $0.15 – $0.25 per mile. |
| Have you refused to purchase optional extended warranty service? You don’t need it if the manufacturer’s warranty covers your car for the entire lease term. Do not buy other “protection” options; they are usually not worth the cost. If the dealer has already installed these items, refuse to pay for them if you don’t want them. |
| Is the Gross Capitalized Cost amount in the contract correct? It should be the agreed-on price of your vehicle plus any acquisition (bank) fee that you are not paying up-front in cash. There should be no other costs included in this amount. This is a common area for dealer “mistakes.” |
| Is the Adjusted Capitalized Cost correct? This should be the Gross Capitalized Cost minus any trade-in credit, down payment, or rebates. Make sure no extra hidden fees have been added to this amount. |
| Does your contract give you proper and full credit for your down payment and trade-in? This is one of the most common “mistakes” in leasing contracts. |
| If you are adding sales taxes or a previous car loan/lease balance to your new lease, have these amounts been specified correctly in your contract? |
| Is the term (length of your lease, in months) of the lease correct in the contract? Do not lease for a period longer than the manufacturer’s warranty on the vehicle. Make sure the dealer hasn’t increased the term to lower your payments, without your knowledge and agreement. This is another dealer “trick.” |
| Was your monthly payment calculated correctly using the standard lease payment formula or tables? The factors you need for the formula are Adjusted (Net) Cap Cost, Residual, Money Factor, and Term (months). You’ll likely have to ask for the Money Factor since it’s typically not in the contract. Use the Lease Inspector calculator in this Lease Kit, or any other lease payment calculation method. |
| Is your sales tax calculated correctly? You should be taxed for the city/county/district you live in, not where you lease the car. In most states, sales tax is added to your monthly payment. You pay sales tax on your down payment (cap cost reduction) at time of lease signing. |
| Are there any extra fees or charges in your contract that were added without your knowledge or understanding — not including official fees such as tag and registration fees? If so, make the dealer explain them. Negotiate any unreasonable charges out of the contract before you sign. |
| Check the section of your contract titled, “Amount Due At Lease Signing.” This is cash you pay up front and should include your first month’s payment, security deposit (if any), down payment (if any), and official fees. The lease acquisition fee is often paid as part of this up-front payment. Watch for other items that have been added and make sure you understand and agree with each item. |
| Are there any blank lines in the contract? Are they appropriate or not? Nothing in the contract should be left to be “filled in later” by the dealer after you have signed. Note that the dealer’s signature is often left blank on your copy of the contract, which is not a problem. |
| Did you get a copy of your lease contract and any other papers you signed? Did you read and understand the other documents? After you sign your contract and take possession of your vehicle, there are no “right of return” laws that would allow you to change your mind, cancel the lease, and return your vehicle. |
| Even though you signed your lease contract, if your credit has not yet been approved by the lease company, you should realize that the dealer may come back to you in a few days and request more money or ask you to return your vehicle. Ask your dealer if your credit has been approved by the lease company. If not, and your credit is not great, DO NOT drive the vehicle home until you receive your approval notice. |
