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Car Leasing The allure of leasing a car is that you don't have to pay for or finance the entire cost of a vehicle. You are simply paying for the access and use of that vehicle for a specific time period which is most often two or three years. Leasing should not be confused with renting even though the principle is similar. Evaluating a lease and whether it is the right option for you is a matter of basic arithmetic and you should consider these factors: Total initial payment, including any extra fees Monthly payment Number of months in lease Possible additional charges at the end of the lease A leases monthly payment is based on the difference in the vehicle's transaction price ("capitalized cost") and what it is estimated the car will be worth at the end of the lease term ("residual value"). This difference is financed at a particular rate of interest (which may be called a "lease rate," "lease charge," or "money factor"). Typically, your down payment and monthly charges will be lower with a leased vehicle than one purchased outright. That's why you can usually obtain a better vehicle for the same cash you put down. You might need nothing more to secure a lease than the first month's payment and a security deposit, which is usually about one monthly payment. Details vary sharply, though. Many lease deals require a substantial down payment and possible additional charges. Nothing affects lease terms more than your credit score. The alluring terms seen on TV commercials are available only to customers with a top-notch credit history. So-so credit means a bigger down payment and/or higher monthly payments. Poor credit generally means no lease at all. Federal Reserve Board: Vehicle Leasing - http://www.federalreserve.gov/pubs/leasing/ Thorough guide providing information on all aspects of vehicle leasing. Lease Guide - http://www.leaseguide.com Guide to car leasing reveals how leases work, how to negotiate deals and calculate monthly payments. LeaseSource - http://www.leasesource.com/ Thorough resource featuring lease-loan compare, lease deals and lease education guides.

Car Leasing

The allure of leasing a car is that you don't have to pay for or finance the entire cost of a vehicle. You are simply paying for the access and use of that vehicle for a specific time period which is most often two or three years. Leasing should not be confused with renting even though the principle is similar. Evaluating a lease and whether it is the right option for you is a matter of basic arithmetic and you should consider these factors:

Total initial payment, including any extra fees
Monthly payment
Number of months in lease
Possible additional charges at the end of the lease

A leases monthly payment is based on the difference in the vehicle's transaction price ("capitalized cost") and what it is estimated the car will be worth at the end of the lease term ("residual value"). This difference is financed at a particular rate of interest (which may be called a "lease rate," "lease charge," or "money factor").

Typically, your down payment and monthly charges will be lower with a leased vehicle than one purchased outright. That's why you can usually obtain a better vehicle for the same cash you put down. You might need nothing more to secure a lease than the first month's payment and a security deposit, which is usually about one monthly payment. Details vary sharply, though. Many lease deals require a substantial down payment and possible additional charges.

Nothing affects lease terms more than your credit score. The alluring terms seen on TV commercials are available only to customers with a top-notch credit history. So-so credit means a bigger down payment and/or higher monthly payments. Poor credit generally means no lease at all.

Federal Reserve Board: Vehicle Leasing - http://www.federalreserve.gov/pubs/leasing/
Thorough guide providing information on all aspects of vehicle leasing.

Lease Guide - http://www.leaseguide.com
Guide to car leasing reveals how leases work, how to negotiate deals and calculate monthly payments.

LeaseSource - http://www.leasesource.com/
Thorough resource featuring lease-loan compare, lease deals and lease education guides.