Welcome To The Auto leasing Blog

2010년 8월 13일 금요일

Reference Page

Toronto Automobile Dealers Association (TADA)

Purchasing a vehicle these days is not an option anymore. If you live in an urban area or if you are a parent, you need a vehicle. Vehicle leasing or financing became very popular as many young people these days are financially well, so they either finance or lease vehicles when they purchase a vehicle. Plus, luxury vehicles are more accessible compared to the past and that boosted number of leased vehicles. However, many automotive customers still do not have clear ideas of vehicle leasing. I would like to encourage those who are interested in vehicle leasing to visit T.A.D.A’s website. T.A.D.A stands for Toronto Automobile Dealers Association and it was established in 1908 and represents every automotive manufacturer and automotive franchise. T.A.D.A also gives assistance to over 340 new vehicle dealers in GTA. As its purpose is to promote automotive customers an affirmative image of the retail automotive industry and it assists its members to serve customers in a better way. T.A.D.A’s website surely provides a guide to vehicle leasing. This website gives valuable ideas to those who are considering vehicle leasing or having hard time deciding between leasing and buying. T.A.D.A does not only provide the definition of vehicle leasing but also provides crucial glossary that customers should be aware of. I hope everyone enjoys and gets full knowledge of vehicle leasing.

URL : http://www.tada.ca/guide_to_vehicle_leasing.htm

Auto Leasing: The Art of the Deal

Auto leasing became popular in theses days. However, customers still do not have enough information about how the auto leasing works. This website, Lease Guide will help customers to understand basic auto leasing guides. This website breaks down into the several categories and they are arranged by little step by step. For example, it starts with the auto leasing introduction to the lease end options. Therefore, readers can easily understand the auto leasing process and can get quick access to the information that they were looking for. Furthermore, this website contains exclusive articles for the automotive customers which has all the information about leasing, loans, credit, insurance and used car. If you are a beginner with the auto leasing or even a expert, visit this website. I believe that you will get useful information.

URL : http://www.leaseguide.com/index2.htm/

Car Lease Auto

If you were looking for a website that is like your textbook, maybe Car Lease Auto is right one for you. This website is extremely focused on consumer‘s position than the any other auto leasing guide sites. Therefore, it is not surprise that this website is rated as a number one consumers guide to auto leasing. The website contains auto leasing educational tutorials and guides on the basics of auto leasing to the advanced information. Furthermore, the auto leasing education is divided in to four section which are auto leasing 101, 201, 301 and 401. In this way, the customers learn more effetely and interestingly. In addition to that, this website offers free auto lease eBook which you can actually download and print it. Since the website always posts their newest information about the auto leasing, I believe that this is a great chance to learn more about the auto leasing and download a free auto lease eBook for your future convenience.

URL : http://www.carleaseauto.com/index.php#overview

The Federal Reserve Board

Many automobile consumers are not aware of that they have certain rights to information about the costs and terms of an automobile lease and when people are thinking of preparing for a new car, they are extremely ambivalent about auto leasing and buying. This website, The Federal Reserve Board, contains great information about the right to know about costs and terms of an automobile lease, auto leasing and buying a new vehicle. The information is well organized in a huge chart which makes the automobile customers to grasp a better understanding. The chart helps automobile customers to compare those two different sections such as ownership, monthly payment, early termination, future value and more. Furthermore, this website informs about customers’ rights and responsibilities when you are leasing a vehicle. I believe that knowing your right and responsibilities are extremely significant when you are leasing a vehicle. Therefore, visit this website and find out more useful auto leasing information.

URL : http://www.federalreserve.gov/pubs/leasing/

ALG

In previous post, I mentioned about how important residual value is when you are thinking about leasing your future vehicle. Moreover, I also said that Residual Value is the key value that sets your monthly payment. The higher residual value, the lower your monthly payment is going to be. Thus, I introduce you to this website called ‘ALG’; this website is mainly dealing with automotive residual values and analytical data products. Furthermore, this website gives you general idea of how automotive industry works and there are also some handy tools that help you understand about auto leasing. In addition to that, they offer you guidebooks on auto leasing, custom quote, lease calculator, analytical data services, portfolio analysis, depreciation ratings, and data analytics. I am very positive that this website will sure help you understand automotive residual values and it will be handful aid when you consider leasing your vehicles in the future.

URL : https://www.alg.com/

References

Anderson, J. (2009). Leasing Is Alive and Well. Kiplinger's Personal Finance, 63(5), 86. Retrieved August 5, 2010 from Academic Search Premier database.

CarBuyingTips. (2010). How To Lease A New Car And Avoid Dealer Scams. Retrieved August 7, 2010 from http://www.carbuyingtips.com/glossary.htm

Geschwind, B. (1993). Auto leasing: Pro and con. (cover story). DollarSense, 6. Retrieved August 6, 2010 from MasterFILE Elite database.

Infiniti Canada. (2010). Infiniti Canada Financial Services. Retrieved August 7, 2010 from http://infiniti.ca/en/general/ownership/infinitifinance/index.html

Peters, E. (1996). On auto leasing. Consumers' Research Magazine, 79(9), 34. Retrieved August 5, 2010 from MasterFILE Elite database.

Reed, P. (n.d.). Three Tough Leasing Questions Answered. Auto leasing advice by Edmunds. Retrieved August 4, 2010 from
http://www.edmunds.com/advice/leasing/articles/45858/article.html

Rossini, T. (n.d.). Vehicle Leasing. CanadaOne. Retrieved July 28, 2010, from
http://www.canadaone.com/magazine/auto060198.html

2010년 7월 30일 금요일

Things to Keep In Mind Whether You Lease or Buy

1.Whether you lease or buy, you need to insure your vehicle.
In addition to insuring the vehicle, you must make sure that you have the amount of coverage required by your lease.

2.Whether you lease or buy, you are responsible for licensing and registering your vehicle.You are responsible for playing the license and vehicle registration fees during the term of the lease, just as if you bought the vehicle.

3.Whether you lease or buy, you are responsible for maintaining your vehicle.You are responsible for maintaining the vehicle according to the maintenance schedule set out in Owner’s Manual.

4.Whether you lease or buy, you are protected.
There is a Canadian Motor Vehicle Arbitration Plan (CAMVAP) which is a free program available to you from participating manufacturer and leasing companies.

These are some key things you need to keep in mind whether you lease your vehicle or purchase your vehicle.

The Language of Auto Leasing

Auto leasing programs are simply modified version of business leases and that explains why there are so many confusing vocabularies in auto leasing today. Understanding these somewhat complicated terminologies can help you through confusing process. Here are some leasing terms with their definitions.

Acquisition Fee:
This fee covers the cost of preparing and servicing your lease.

Amount to be amortized:
This is the difference between the Net Leased Vehicle Amount and the Residual Value which represents the Depreciation that you pay over the term of your lease.
For example:
This is calculated as follows:
Net Leased Vehicle Amount $ 50,000
- Residual Value $-28,000
= Amount to be Amortized $ 22,000

Annual Percentage Rate:
The Total Lease Charges expressed as an annual rate.

Depreciation:
This is the loss in the vehicle’s value that occurs over time. The more you drive it, and the longer you keep the vehicle, the more the vehicle will depreciate.

Excess Kilometer Charge:
The additional cost if you drive your vehicle more kilometers than the maximum stated on your lease.

Leased Vehicle Amount:
This is the amount you and the leasing company agree on for the vehicle.

Residual Value:
This is one of the most important leasing terms and it is the estimated wholesale value of the vehicle at the end of your lease which means that the higher the residual value, the lower your monthly payments.

Early Termination:
This means you want to get out of the lease contract before all your payments have been made. For instance, if you are sick of driving the same car or you cannot simply afford it, you decided to terminate the lease. However, just like the home mortgage, you must pay a penalty to the leasing company. If you want to avoid this penalty, you might try finding someone to take your lease over.

Buyout Amount:
At the end of your lease contract, you can buyout your leased vehicle if you want to and buyout amount is the amount of money you have to pay to own the car.

As I mentioned above, knowing this leasing terminologies will significantly help you when you decided to lease your future vehicle.

Should I Lease or Buy?

It seems that it is a common dilemma for many automobile customers who are comparing purchasing options. Is lease better option? It depends on each individual. Simply say, leases and purchase finances (loans) are two different ways of automobile financing. Lease is financing the use of a vehicle and a loan is financing the purchase of a vehicle. Each method has its own advantages and disadvantages. The important point here is that it is almost impossible to conclude that one is better than the other for sure because it depends on your own situation and preferences. What you need to do first is to decide what is important to you. Here are some questions that you may want to take some time to think of. Is having a new vehicle every 2 or 3 years with no hassle for major repairs more important than long term cost? Are long term cost saving more important than lower monthly payments? Is ownership more important than low up-front costs and no down payment?

Buying and leasing are different

When you buy, you pay for the entire cost of a vehicle; regardless of how many kilometers you drive it. On the other hand, you only pay for a portion of a vehicle’s cost, which is the part that you use up during the time you are driving it. For example, if you lease a vehicle that costs $30,000, but is worth only $23,000 after 2 years, you pay for the $7,000 difference (it is called depreciation), plus finance charges, plus fees during the term of the lease. When you buy, however, you pay the entire $30,000, plus finance charges, plus fees. This basically explains how leasing offers remarkably lower monthly payments than buying.

So, which is better, lease or buy?

As I mentioned earlier, it depends on what is most important to you. If you prefer lower monthly payments and like a driving a new vehicle, that’s always under warranty period, every 2 or 3 years, but are willing to pay a little more over the long haul to get those benefits, then lease is the way for you.

If you prefer to pay off your vehicle, do not worry about payments, and drive it for as long as you want, but are willing to have higher initial monthly payments and maintenance costs, but lower long-term costs, then you should buy.

For those who are still making decisions, it might help you decide whether to buy or lease. From the article written by Jessica Anderson, I found this statement very compelling "Leasing still makes sense if you trade in every few years and always have a car payment." (Anderson, 2009).

The chart below is the comparison of a typical lease compared to a 0% loan and a typical loan. I have to warn you though, because it does not necessarily mean that leasing is always better. Monthly payments are not the only factor that you should consider.

Why Leasing? Why Is Leasing Popular?

If we go back to about 10 years ago, most automobile consumers were not aware of what auto leasing is. Now, nearly 40% of all new automobiles are leased in Canada and the numbers are increasing rapidly each year. If you wish to know how popular leasing has become, you can just take a look at lease ads in newspapers.

There are two main factors that caused the favourable shift to leasing. Firstly, the cost of new cars has increased significantly over last few years and that high cost of new cars put out potential average buyers. Secondly, in the late 1980’s, tax law changed and it eliminated interest deductions on automobile loans and that lead increased the cost of ownership experience. Thus, people were eager to find ways to make their personal vehicles more reachable.

Leasing has become incredibly popular because it gives an opportunity for people to drive the vehicles they want or vehicles that they dreamt of for less money and less hassle. However, as attractive as it may seem, leasing certainly does not fit everybody’s lifestyle. Moreover, leases can be more complicated than purchase loans. From the article written by Eric Peters, he puts it this way, “The problem with leasing isn’t so much the cost; rather, it’s the perceived complexity” (Peters, 1996). In order to get a good fair deal on your auto leasing, you must do your research and preparation.

What Is Auto Leasing?

Although automotive leasing became a very popular method for Canadians to own a vehicle, it is true that many consumers get confused when it comes to leasing a vehicle. So, let’s find out what automotive leasing is about.

The idea of auto leasing is quite simple but many customers do not completely get the idea of it. Even some experts have misconceptions about leasing and give customers wrong impression about leasing. Auto leasing may seem relatively new to automobile customers but leasing, in fact, has long been used in the business sector as a way of financing equipments, buildings, and vehicles. Unfortunately, auto leasing is fairly new to customers and they are still learning about leasing. There have been scams in which their lack of knowledge has been taken advantage of. There are some customers who are leasing vehicles and are not even aware of their unfair leasing contracts. According to Ashly Knapp, head analyst at Auto Advisor which is a Seattle-based nationwide service that arranges auto leases and purchases, “Many people find that leasing has all the negatives of ownership and none of the positives” (Geschwind, 1993). However, do not be afraid of leasing because you will be fully knowledgeable of auto leasing after reading my posts. I am going to give you some valuable information that you need to know about leasing and it will help you when you lease a vehicle in the future. As long as you understand how auto leasing works, you will be able to take advantages of leasing and you may never finance a vehicle again. Here is a simple explanation of auto leasing; it is one of the methods of acquiring a vehicle for a fixed period of time.