Source: http://www.findlaynorthvw.com/ 4/7/15

 Source: 4/7/15

 Source: 4/7/15

Reading Assignment

"Should I Buy or Should I Lease?"

Pro Buy:

Pro Lease:



Leasing a Vehicle

What is it? A bank (ex. Honda Financial) purchases the car for

you, and you make monthly payments (like rental payments) to them.

Fixed term: 24 mo, 36 mo, 48 mo

Fixed mileage: 10,000, 12,000, or 15,000 a year

Excess mileage charge ? what you pay PER MILE that you drive more than the agreed amount. (ex. $.20/mile)

You are required to make monthly payments, security deposit (down payment), title fee, and license fee.

Leasing a Vehicle

Types of leases:

Closed-end: You pay a down payment to get the car, drive for the agreed amount of time, make monthly payments, and then return the car.

Pay for ANY damages & extra mileage. No equity.

Open-end: Same as above, EXCEPT, at the end of your term, you can buy the car from the bank for its RESIDUAL VALUE*.

*The expected value of the vehicle at the end of the lease (this amount is decided when you START your lease term).

Leasing a Vehicle

Example:

Anthony leased a pickup. He pays $199 per month for 36 months. His deposit is $2,500. He paid an $800 title fee and a $45 license fee. What is his total lease cost?

Your Assignment

"Practice 9-6" wkst

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