Everything You Need to Know About Leasing a Used Car
Used car leasing is the future
Are you in the market for a new car? Are you dreading the thought of dealing with a salesman, haggling over prices, and financing? Or, maybe you’re not sure if you can afford a new car payment? Relax — there’s a better way. You can lease a used car instead.
It may not have occurred to you to lease a used car. You may have even thought that leasing used cars was not a thing, but it very much is, and it comes with many great added benefits.
Here’s what you need to know.
Used Car Leases are Still Close to New
It is standard practice that only cars released within the past 5 years (2017–2022) are eligible for leasing. As a driver, that means you get to enjoy the latest features and comforts of car makes and models you love, and all for an affordable price (see more below for monthly payments).
When buying a used car outright, you may have to compromise on features to suit whatever budget you have set for yourself; after all, most of us aren’t lucky enough to break the bank like Jeff Bezos when getting a car.
This means if you wanted more advanced driver assistance features or an upgraded audio and infotainment system, or perhaps plusher more comfortable seats, your best bet would be to explore a used car lease.
Furthermore, you can customize the number of miles you want to drive on your lease — thus giving you more flexibility to adjust costs. For example, if you are working downtown where public transportation is readily available and you don’t have to travel very far for work, chances are you won’t be putting many miles on your vehicle at all during the course of a year.
In this case, it would make more sense to go with a used car lease rather than shelling out thousands upon thousands of dollars over the next few years to pay off a brand-new car loan.
Finally, since many leases are within 5 model years old, it means that many of the cars are still within their original manufacturer’s warranty period. If you lease a car that’s 1–2 years old, therefore, you get additional peace of mind in that respect.
You Can Get Lower Monthly Payments
Used car leases have some of the lowest monthly payments across the board.
Car lease payments are designed to cover the depreciation of a vehicle rather than the market value. That’s what keeps lease payments lower in general compared to monthly payments when buying a car.
Leasing is like a dealership agreeing to a hedge with the lender taking on the residual risk. Should you end up in an equitable position at the end of your lease you can exercise the option to own it.
Did you also know that many business owners or self-employed individuals can write off their lease payments as tax write-offs?
In our experience, wealthy people do whatever is most cost-effective. If they want a new vehicle, but the model they are looking at has some serious depreciation — they will probably lease. If the vehicle is rare and/or expected to go up in value, they will probably buy it instead.
Your car is going to be the second-largest purchase you make after buying a house. The car buying process shouldn’t be trifled with. As mentioned above, not everyone can afford brand new car flat out — and this is why used car leasing is a great option for lower monthly payments.
Take these things into consideration before signing anything.
You Can Try Before You Buy
What some people don’t realize when it comes to leasing a car is that you do have the option to buy it at the end of the lease period.
Let’s say you lease a used BMW 3 Series for a 24-month period because you’ve always wanted to drive one. One year later and it turns out they’re not as fun to drive as you imagined. They suck. So you return it when the lease is up and sign a new 24-month lease on an Audi A4.
You find the A4 roomier, more fun to drive, and with better features that you love it. But it’s leased, you don’t own it, right?
Well, no, you don’t own it yet, but you could. Either at the end of that 24-month lease you buy out the rest of the car’s market value, or you return it and buy a different Audi A4 from the dealership.
One more final thing people love about a used car lease is that at the end of the lease period, you don’t have to think about how to deal with the car. If you buy a car privately, then lingering in the back of your mind are thoughts on what you’ll eventually do with it when you no longer need it.
Will you spend weeks trying to sell it online? Will you sacrifice a lot of market value selling it more rapidly to a dealership?
When you lease a used car, you don’t have to wonder. At the end, you either buy the car, return it for a new one, or just return it and move on. It’s all handled, with no ambiguities.
Final Thoughts
In closing, leasing a used car is the best way to go for any person who are strapped for cash. Actually, scratch that. You don’t even have to be strapped for cash. Used car leasing is good for anyone who wants to save money and not carry the burden of owning a car!
Used car leasing is also much better than leasing a new car, because you can get more features and a nicer car for less money.
If you’re looking for your next set of wheels, you likely won’t regret it through used car leasing.
