CINCINNATI—Leasing levels have reached the highest in history, accounting for about one in three new cars sold today.
As leasing interest grows, so do “myths” regarding the financing option, asserts Swapalease.com, which listed the top six myths consumers have regarding leasing, based on consumer interactions with its customer advisor team.
- Lease Myth #1: Captive is the better way to finance a lease. “There are plenty of times when the captive financier is a good bet. However, some captives won't provide full flexibility in lease terms, which can cost a lot of money at the end of the lease,” Swapalease.com said.
- Lease Myth #2: Cheapest monthly payment is best for your wallet. “Often, asking for the least amount of miles will result in a lower monthly payment. However, running over on your miles can end up costing far more than if you structured lease terms with more miles on the front end,” Swapalease.com said.
- Lease Myth #3: Pre-owned cars can't be leased. “Used leasing is becoming more popular, and lending arms such as Ally and Toyota have recently introduced structured used lease programs for customers,” Swapalease.com explained.
- Lease Myth #4: Subprime candidates aren't good for leasing. “As an extension of myth #3, giving subprime candidates a lower monthly payment in a shorter amount of time (two years, for example), would give them a better chance at making the payment and satisfying the term, as opposed to a five- or six-year term that involves refinancing in the middle of the term,” Swapalease.com said.
- Lease Myth #5: I don't want to lease because I want to own my car. “Most financing today comes with a seven- or even eight-year loan term. The reality is that most people will trade in their car before completing the loan term, meaning few people will actually end up ‘owning’ their car in that instance,” Swapalease.com said.
- Lease Myth 6: Wear and tear will hit me in the wallet at lease end. “Many brands today are very interested in keeping you in the family at lease end. Even with a few dings and scratches, brands may be more than willing to forgive some of those dings and scratches when you agree to lease or purchase again with them,” Swapalease.com explained.