There is another big disadvantage: in the event of your car getting damaged or stolen, you insurance and the gap cost will not cover the loss. Then you should take a look at instant same day loans or mortgage deals
Even people working from home have little trouble putting 15,000 miles on their cars. If you exceed the mileage limit, the penalty for each excess mile can be as high as 20 cents. This can add up quickly over the length of your lease: an additional 4,000 miles a year over the length of a 3-years lease contract, will end up costing you an extra $2,400 in excess mileage charges!
Be realistic about your mileage needs, especially if you have to regularly commute over long-distances, before you sign the contract. Consider padding he miles that you expect to use since it is less expensive to contract for the extra before you sign than it is to pay the extra charges at end of your lease.
Let us suppose you're leasing a car with a capitalized cost of $25,000 and a residual value of $15,000. You average balance over the lease term, irrespective of how long it is, is $20,000 - the sum of the two divided by two.
Depreciation fee: Forms part of the monthly lease payment charge and accounts for the loss in the value of the car at the end of the lease. The vehicle's list price minus the expected residual value at lease end is divided by the number of months in the lease to give the depreciation fee.
This finance charge is added to the depreciation charge to calculate the monthly payments on your lease. Leasing has been lauded as your cheapest ticket to keep up with the industry's hottest vehicles and trends.
Mileage allowance The maximum number of miles a leased vehicle can be driven a year without incurring an excess mileage penalty. A typical mileage allowance is 12,000 to 15,000 miles a year, although this is negotiable with your leasing company.
Residual value Residual value is the amount of money the leasing company says your leased vehicle will be worth when your lease ends. Higher residual values lead to lower monthly payments but higher lease-end purchase cost if you decide to keep the vehicle.
Author Resource:
Hopefully you enjoyed this leasing-article. I write often about finance related topics. You might also want to check out some great information about: school loan consolidation or bad credit mortgages
![[Valid RSS feed]](http://www.look4articles.com/images/icon_Rss.png "XML Feed For RSS"){kind=icon}
Category Rss Feed
Print This Article
Add To Favorites
![[Valid RSS feed]](http://www.look4articles.com/images/rss.jpg "XML Feed For RSS")