Traditional leasing, with contracts ranging from 24 to 60 months, is one of the preferred models for those who want a new car without the complications involved in buying one. However, there are things you should keep in mind, and here are some helpful tips for leasing.
The single monthly fee includes insurance, maintenance, taxes and assistance. As a result, you can enjoy the benefits of driving a new vehicle without worrying about all the paperwork. However, not everyone knows how to make the most of the benefits.
Some drivers don’t approach the traditional lease contract with enough care, which in the end results in unforeseen expenses or problems at the end of the contract. And while the all-inclusive concept sounds all well and good, make sure to read the fine print. If you are thinking of taking the plunge, here are the five most common mistakes and the leasing tips you need to know.
Failure to calculate annual mileage correctly
The first mistake (and one of the most costly) is not staying within the miles established in the contract. Most leasing contracts set an annual limit (for example, 10,000, 15,000 or 20,000 miles) and apply an extra cost per mile driven.
The problem is that many users underestimate their usage in order to pay less, and get an unpleasant surprise when the contract ends.
✓ Leasing advice: Think carefully about your typical journeys, write down the average number of miles you drive in a month and calculate an annual average (taking into account holidays and unforeseen events). It is better to pay a little more per month for a plan with more miles than to be on the wrong end of a surcharge later on.
Failure to review insurance coverage in detail
Another common mistake is to assume that everything is covered by the insurance. The term 'all-inclusive' may vary from company to company. Some contracts cover self-inflicted damage, windows, tyres, theft or fire, while others don’t cover these issues.
As a result, a small claim that was not covered by the policy may end up costing you dearly.
✓ Leasing tip: Before signing, read over the contract thoroughly and check the fine print. Ask about the excess, roadside assistance, whether it covers damage due to vandalism and whether you will have a courtesy vehicle in case of a breakdown. Never take anything for granted.
Ignoring early cancellation penalties
Traditional leasing contracts normally cover a range of 24 to 60 months, and if you terminate the contract early, you are likely to incur penalties. This is also covered in the contract.
If your circumstances change (e.g., moving home, loss of job, little use of the vehicle), you may have to pay a percentage of the remaining instalments.
✓ Leasing tip: Make sure you understand the cancellation terms before you sign anything. If you think your situation may change in the future, perhaps flexible leasing or something with a lower duration are better options for you.
Failure to correctly compare what is included in the fee
You might be in a situation where two offers have the same monthly fee, but different content. For example:
- One may include comprehensive maintenance, tyres, premium insurance and a courtesy vehicle.
- The other maybe only some of that, or none at all.
In addition, some companies place limits on these services. For example, tyre changes every 25,000 miles or inspections in authorised workshops.
✓ Leasing tip: When comparing leases, always ask for a breakdown of what each instalment includes. Check if there are limits, if the maintenance is official or arranged, and if tyres or roadside assistance are included.
Failure to document the condition of the vehicle at the beginning and at the end of the contract
Last but certainly not least, this error has to do with the delivery and return of the vehicle. At the end of the contract, the company checks over the car and may charge fees for 'excessive wear and tear'. It is especially a problem when the condition of the vehicle is not documented at the beginning and at the end of the contract period.
✓ Leasing tip: When picking up the car, take a video or photos from all angles and get a good view of the interior, tyres, bodywork and license plate. Note and record any scratches or damage. This will serve as proof in case of a disagreement between the two parties.
Traditional leasing is one of the most convenient models for keeping costs under control. At OK Mobility, we make it easy for you with a single monthly payment with everything included (full insurance with no excess, maintenance, repairs, taxes, MOT and 24-hour roadside assistance). In addition, you can choose your new car without any initial outlay - no downsides, only advantages!
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