Car leasing has become very common across the United States with everyone from students to businessmen choosing this mode of owning a car. It offers them the flexibility of owning a car, a new one at that. However, leasing is an option that is filled with many pitfalls for the customers. Leasing regulations does not insist that the leasing company disclose all details regarding the contract or the car to the buyer at the time of signing the documents. Therefore, there are many tricks adopted by the leasing company into making the customer believe the deal being given is the best one.
Let us now look at some of the common leasing scams and how they can be avoided,-
Interest rates at an all time low
There are some dealers who quote an interest rate which is very low, but in reality is high. They do this by quoting just the basic price, and excluding the other charges levied. What happens is that the customer believes the agent and falls for this trick, assuming they are getting a good rate. For people who are not very smart with numbers, or don’t know the market rates, they will not think twice about this low interest rates. Therefore, it is necessary for the buyer to have done some homework before meeting the leasing agent and be aware of this ploy
Terminate lease early to save on penalty
When talking to the leasing agent, if you were to discuss termination of leasing agreement before it comes to maturity, he might tell you a fee of $300 will be levied, that you need to pay. It might sound pretty reasonable, but remember he is quoting only the penalty fee and not the total that you will have to pay for early termination. It could run to several thousands, so beware of that. It is always wise to read the fine print on the contract before signing; this will save you money and unnecessary hassles at a latter date.
Extended warranty on short term leasing
There might be sentences on the lease agreement that you would not have read through. One of the common scams is that they include a 3 year extended warranty when the term of lease is only 2years. This is an extra expense that the customer need not bear, but is forced to because it has been weaved into the contract and goes unnoticed by most people. A warranty for the 2 year period should already be included in the lease agreement, which means this additional warranty is not necessary at all.
No security deposit
If the leasing company advertises a no security deposit sign, be wary, for there is a minimum deposit charged for all customers. So, even if they tell you they don’t charge, it could get weaved into the contract and somewhere you end up paying more than you have to. They then compensate the amount towards the deposit while you are still in oblivion about this trick.