Leasing turns out to be lot easier an alternative to purchasing, as long as we are talking about vehicles. Who pays up a choking sum of money for a vehicle that will run only a few years when you can obtain the same car for a few years on lease. Leasing is like owning a vehicle without the pains and problems. A vehicle is good to drive, but not when your company merchandises need to transported from one warehouse to another, or your tradesmen need to attend a service call on site. Leasing is easy till the close of the deal only when you have insights about the contract.
Leasing: The Two Standard Kinds
Vehicular leasing is of two kinds, viz., open and close-ended leases. Both have the basic monthly rental structures with close-of-the-deal payment differences. For open-ended deals, you would be contracted to pay up the difference between residual and present market value of the asset in question. As for the second kind, also referred to as the walk-away lease deal, you have no commitments to make in the end. You can choose to not purchase the vehicle and simply write off another agreement for another vehicle. If flexibility is your priority, a close-end deal is just what is needed. As for those willing to make an investment of a good running vehicle, the former makes sense.
One must fulfill certain leasing requirements in order to qualify for a leasing contract. Whether you are a business owner or an individual, you have to have good bank credits. The lessor will ask for your credit history for evaluative reasons. A lessee is asked a certain sum of upfront deposit that will cover for a few months of rental, should the taker turn defaulter after a few months.
From a Lessee’s Side of the Picture
Early termination of the lease will be subjected to penalties. It should be your aim to bring down the amount of initial deposit to a moderate figure so that you do not have to fork up a sizeable amount at the very start of the deal. A successful negotiation is possible when you have an impressive credit record. As a way of maintaining a good equation with the dealer, try to limit yourself to the mileage limit and handle the car like it’s one of your own. Routine maintenance costs are included in the rental charge which makes it unnecessary to send the van to the service center during the lease tenure.