Leasing a used vehicle is a little less common than leasing a new one, but this does not mean it is something unusual. Leasing a used vehicle is quite similar to leasing a new one, giving you temporary ownership of a car for a set amount of time and money. Visit eAutoLease.com to find out how you can drive a car that is very close to what you want for a lot less cash with used-car leasing. With expert assistance, you can secure a used car lease on a better vehicle and save thousands of dollars too.
Used car leasing has become popular with certified pre-owned CPO car programs and an increase in lease-swapping websites. As they offer the same flexibility as new car leases but at a fraction of the price, you can look forward to driving a low-mileage or a luxury vehicle without breaking the bank.
If you are looking for a low monthly payment and just want to keep a car for a few years, used car leasing may be a good option. It gives a chance to drive a near-new vehicle at a low price. The only downside is that leasing is typically more expensive in the long run as compared to buying a used car.
Read more: Assuming a Lease
Can you lease a used car?
Yes. You can lease a used car. It is not as common as leasing a new vehicle but used car leases are a viable option as well. They may not be as readily available across dealerships or are not heavily promoted, but still, you can get one.
Used car leases are a great way to test out a vehicle you have been wanting to drive without disrupting your budget. They are gently used cars, less than five years old, and have lower mileage. If you are interested in leasing a used car, it is essential to do your homework to ensure you get the right vehicle and also save thousands of dollars.
How to lease a used car?
You can lease a certified pre-owned (CPO). These vehicles are less than five years old and with fewer than 48,000 miles on the odometer. They are carefully inspected by professionals before they are certified, which makes them fit for leasing. Many dealerships also have their own certification process to ensure you are getting the right vehicle.
Sometimes it is not easy to find a used car for lease as most people prefer new cars, and the shortage of good-condition used cars in the market makes it tough, but it is not impossible. You can also find a used car lease by taking over a lease from a current leaseholder. Outgoing lessees list their vehicles on popular matchmaking services. Unlike a traditional lease, you can avoid down payment and upfront acquisition fees by leasing a used car.
However, the current leaseholder’s leasing company must approve your lease transfer. It would also charge a transfer fee, but you can get deals that make up the cost of the transfer fee and more. Once the lease is transferred to your name, you will have to make monthly payments and potentially pay a turn-in fee when the lease comes to an end.
Used-car leasing vs. new-car leasing
Used car leasing works the same way as a new car lease. You may have to make a down payment and pay an acquisition fee to get started. The monthly payments are based on the difference between the car’s purchase price and the estimated value at the end of the lease or the residual value.
The interest on the loan is added to the monthly payment. It is essential to know that used lease rates are typically higher than new. As the lease ends, regardless of how you obtained this used car lease, you may have to pay a disposition or turn-in fee, as well as any penalties for exceeding the lease’s mileage limits and wear and tear policy.
If you are still deciding between leasing and buying, it is best to use an online calculator from your bank or auto insurance provider to determine how much it costs to lease a used car as compared to buying one.
Read more: Pros and Cons of Taking Over Car Lease Payments
Is leasing a used car a good idea?
It depends on certain factors. One of the reasons why leasing a used car is a smart idea is that you can get a lower monthly payment than a new car purchase or lease. However, if you plan to hold on to a car past its lease term, it is better to buy it. Leasing is the way to go if you want to drive it only for two to three years, but if you wish to keep a car for five or six years, you should purchase it.
Knowing the benefits and downsides of leasing a used car will help you make a wise decision.
Pros of used car leasing
- Lower payments – Leasing a used vehicle means lower payments than getting a new lease or buying a new one.
- Better, nicer car – You can afford a better-looking car or a higher trim level than leasing or buying the newest model when you lease a vehicle, which is only a few years old.
- Longer warranty – A certified pre-owned (CPO) vehicle has a manufacturer’s warranty. It ensures you will not face any trouble anytime soon. It is something that other used cars do not have.
Cons of used car leasing
- High-interest rate – Used vehicles unusually have a higher interest rate or more money factor for a lease as compared to new cars. Manufacturers do not offer some used lease deals as they do for new cars.
- Wear and tear – CPO cars are inspected carefully by the manufacturer, but they are still used cars, and many come with some degree of wear and tear. Some vehicles may also lack the latest safety features or technology.
- Maintenance costs – CPO warranty may not cover parts like brake pads and tires. You may have to pay for some maintenance when the time comes.
- Limited inventory – As used car leasing is not very popular, you may not find used cars for lease everywhere.
How to secure a used car lease
Here are the top steps for securing a used car lease deal successfully:
Negotiate carefully to get the best deal
You can negotiate a used car lease deal just like a new lease or auto loan. Start with the price of the car and discuss the down payment amount or trade-in value, mileage limits, and purchase options. Taxes, title and license fees, acquisition fees, dealer fees, and other costs are added to the lease, which can be a hefty amount, so it is essential to negotiate carefully to get the best deal.
Decide on a warranty
Along with the CPO warranty included by the manufacturer, the dealer may also offer an extended warranty. Also known as a vehicle service contract, extended warranties are an extra cost. It may offer additional peace of mind, but there is no need to pay more if you are already receiving coverage under the CPO warranty and the vehicle’s original warranty.
An extended warranty or vehicle service contract can cost anywhere from $1,200 to $2,500 or even more. You can compare the dealer’s offer with those from independent companies, auto insurance providers, and even some credit unions and car clubs to check out which warranty would work best for you.
Take a look at other add-ons
A leasing company may require you to buy guaranteed asset protection, also known as GAP insurance. GAP insurance covers the difference between the amount on your lease and the amount your auto insurance company pays in case the vehicle is stolen or damaged in an accident. Check out whether you require GAP insurance and if it is included in your monthly payment, or if you would have to shop for it.
Understand the contract
Before you sign the lease contract, you must read it carefully. Find out about early termination fees, excess wear and tear charges, and mileage fees. There may be an option to purchase additional miles upfront or within a capital period at a lower price than paying the penalty at the end of the lease. Read the fine print to make sure you do not end up paying more than you bargained for.
Also, if you are interested in buying the car, check out purchase options at the end of the lease. Based on the residual value, the purchase price should be mentioned in the agreement. If the car is worth more than the residual value, it is a good deal.
How to negotiate a car lease?
Start by getting an idea of what similar vehicles have sold in your area so you have a good understanding of the car’s worth.
Other factors like vehicle color, the number of previous owners, warranties, after-market features, and new or older brakes also play a crucial role when negotiating a fair price, so keep them in mind.
Doing your homework ahead of time, understanding the costs, working within your budget, and talking to the right people who can guide you in the right direction can help you find what you are looking for.
Check out eAutoLease.com to find out more about leasing a used car in the most hassle-free manner. You will find all brands, makes, and models and get exactly what you need without wasting time. With recommendations from professionals, you can look forward to leasing a car in the most stress-free manner.
