Categories: Lifestyle

How Does A Car Lease Work?

Most people need a car to help them get to where they need to go on time. That’s why a lot of people save up their money or get a car loan to help them pay for a car. However, saving up money takes a lot of time and effort, or you could get rejected for a car loan because of bad credit. A great alternative is to apply for a car lease.

A car lease allows you to get a car for an affordable price. You are given the option to either buy the vehicle at the end of the lease or get a new contract for a newer car; allowing flexibility. But just how does it work?

IMAGE: PEXELS

How A Car Lease Works

A car lease allows you to essentially rent a car for a prolonged period. It’s not yours until you decide to buy the vehicle at the end of the contract. Here are some reasons to get a car lease:

Faster and easier approval: Car loans take in a lot of factors like your credit history before they decide to approve your application. A car lease often has fewer requirements, giving you a better chance at approval even with bad credit. You just need to prove that you can handle the lease payments.
Manageable payments: Car lease upfront payments are generally more affordable compared to traditional car loans. Not to mention, you can talk to your account manager to find a car that fits within your budget; how much you can pay for the car and how often. Customers are given the option of weekly or fortnightly payments.
Choose a car: Find a late model vehicle that suits your needs. Car lease companies often have vehicles ranging from compact vehicles to SUVs ready for you. However, keep in mind that the car you can lease will also depend on your income. So, there is a chance you might be rejected for some vehicles.
The best thing about a car lease is flexibility. Once your contract is up, you are given three options: return the vehicle, upgrade your lease car, or pay the residuals and own the vehicle.

What You Need To Know Before Applying For A Car Lease

Now that you know a little more about how a car lease works and what you can expect, you’re probably eager to send in your application as soon as possible. Before you finish off your application, here are some things to keep in mind to help give yourself the most significant chance for approval:

Organize your paperwork: Read up on what documents the car lease company needs to see. This usually includes photographic identification, proof of residence and proof of income. Find out what else they need and make sure you have it all with you. That way, you can be prepared.
Be honest: Don’t be afraid to let the company know about your current financial situation. It’s better to let them know now rather than later when they conduct a credit check.
Know what you can afford: It was mentioned before that the car you can lease will depend on your income. With that said, it’s best to know what car best fits into your family’s needs and budget.

Prepare yourself and increase your chances of approval when you know what you need to have, and what to expect when you send in your application.

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