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Keys to Vehicle Leasing

Shopping Checklist

This checklist will help you gather information both before you go shopping for a vehicle lease and while you are shopping. The questions highlight features of vehicle leasing that you may want to consider before signing a lease agreement. Many terms and conditions in a vehicle lease are negotiable, so you can tailor a lease to fit your driving habits and financial needs. Nothing is final until you sign the lease agreement, so it's important that you understand all the lease provisions before signing. Gathering information on leasing from automotive publications, media articles, the Internet, advertisements, consumer guides, auto dealers, or leasing companies will help you.

Before You Shop for a Lease

  1. How much can you afford to pay up front? $________
    Each month? $________
    At lease-end? $________
    Consider the beginning, middle, and end-of-lease costs, not just the monthly payment.
  2. Have you chosen a vehicle? ________________________Make/model/options
    Consumer guides, automotive publications, and Internet sites provide information to help you make a choice.
  3. How long do you expect to keep the vehicle? ________years/months
    How long do you typically keep a vehicle? ________years/months
    The lease should fit your needs. Don't lease for a term longer than you intend to keep the vehicle, because you may have to pay a substantial charge for early termination. The earlier you end the lease, the greater the charge is likely to be.
  4. How many miles do you usually drive a year? ________
    Be realistic--underestimating your mileage could cost you at the end of the lease. You may want to check the odometer on your current vehicle to estimate the number of miles you typically drive.
  5. Do you want an option in your lease to buy the vehicle? ________
    You may want the option to buy the vehicle at the end of the lease. Keep in mind, however, that the terms of the purchase option may affect other terms in the lease.
  6. What is your current insurance coverage for
    • Bodily injury, property damage, and liability $________
    • Collision and comprehensive $________
    How much are your deductibles for
    • Collision $________
    • Comprehensive $________
    Your lease may require you to carry a higher level of insurance than you currently carry. For example, the required coverage could be 100/300/50 ($100,000 of bodily injury insurance for the injuries of one person, up to $300,000 for two or more persons per accident, and up to $50,000 for property damage).

While You're Shopping for a Lease

Record the following information while you're shopping for a lease to help you evaluate and compare leases. Also take the Sample Leasing Form with you when you go shopping, and ask the salesperson to fill it out. If you're responding to an advertisement, have the ad with you and compare the terms with other offers.

Vehicle year/make/model ________

See last section of checklist for options and equipment

Lease term (number of months) ________
Mileage limit (per year) ________

  1. How much is due at lease signing (total up-front cost)? ________
    How much is the capitalized cost reduction (down payment)? ________
    How much are the other costs that are included in the total? ________
    How much credit will you receive for any trade-in or rebates? ________

  2. What is the agreed-upon value of the vehicle? ________
    What is the gross capitalized cost of the lease? ________
    You can ask for an itemization of the gross capitalized cost, and you can usually negotiate the amount of some individual items.
  3. What is the residual value? ________
    Does the lease include an option to purchase the vehicle? ________
    What is the purchase-option price, including any purchase-option fee? ________
    Fixed-price and fair-market-value purchase options may be available.
  4. What is the rent charge? ________
    This amount is like the interest or finance charge on a loan or credit agreement. You may be able to negotiate this figure, but a change in the amount may affect other amounts in the lease agreement.
  5. What is the total monthly payment, including taxes? ________
    Make sure the payment amount fits your budget.
  6. What are the end-of-lease costs?
    • Disposition fee and other end-of-lease costs ________
      Your lease may impose a disposition fee if you do not purchase the vehicle.
    • Per mile charge for any excess miles you drive ________
    Have you reviewed the standards for excessive wear? ________
    Your lease should specify these standards.
  7. Are you responsible for the maintenance costs under the lease? ________
    You are generally responsible for seeing that the maintenance requirements are met.
  8. What are the insurance coverage requirements for
    • Bodily injury to 1 person ________
    • Bodily injury to 2 or more persons per accident ________
    • Property damage ________
    What are the maximum deductibles allowed by the lessor? ________
    Check with your insurance company to see what the cost of insurance coverage will be.
  9. Does the lease provide gap coverage if the vehicle is totaled or stolen? ________
    If it does not, how much would gap coverage cost? ________
    Gap coverage pays the difference between the early termination payoff and the insured value of the vehicle. It does not pay for such items as insurance deductibles and past-due payments.
  10. How will an early termination payoff be calculated? ________
    Different methods result in different payoff figures.
    How much in additional fees, if any, are added to the payoff amount? ________

  11. Have you asked about alternatives to the advertised lease? ________
    You can compare different lease offers.
  12. Have you reviewed a copy of the lease? ________
    Read and understand the lease before you sign it. Make sure any oral promises are stated in the agreement. Federal law requires that you receive important disclosures in writing before you sign a lease agreement. You should receive and keep a copy of your signed lease and any disclosures. The disclosures may be in your lease agreement or on a separate form.

Options and Equipment

Vehicles of the same make and model will have different prices if they have different options and equipment. Use this portion of the checklist to compare the options and equipment packages on the vehicles you are considering. Then consider any differences in options and equipment along with the differences in lease payments to determine which is the best choice for you.

Engine size ________
Automatic transmission ________
Air conditioning ________
Stereo tape player ________
Compact disc player ________
DVD player or other video system ________
Cruise control ________
Power windows ________
Power locks ________
Power seats ________
ABS (anti-lock) brakes ________
Tilt wheel ________
Sun roof/moon roof ________
Premium wheels ________
Global positioning system (GPS) ________
Mechanical breakdown protection ________
Extended warranty ________
Roadside assistance ________
Other ________

Last update: March 13, 2013

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