Our calculator shows the best leasing deals of the month. PR/Business Insider
Car leasing is a temporary rental model for vehicles. The biggest advantage of leasing is that you hardly have to raise any equity to purchase a car and instead pay manageable and easy-to-plan monthly installments. When leasing a car, in addition to the term and the monthly rate, you should also pay particular attention to the so-called leasing and total cost factors. These are values that help you evaluate a leasing offer. The lower this factor is, the better the offer is. In our comparison we show you where you can find the cheapest and most attractive leasing offers of the month.
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Before car sharing and the like, car leasing was the alternative to buying a car. This is a time-limited car rental model. As part of a leasing contract, drivers receive a new vehicle for which they pay a monthly installment over a fixed term. After this term has expired, the car will be returned. It can then be exchanged for a new model or, in some cases, purchased. For a long time, this service was mainly used by businesses (because it has various accounting and tax advantages), but it is now also attracting increasing interest from private customers. No wonder, after all, leasing gives people who don’t want to or can’t buy their own car the opportunity to keep a vehicle – with manageable running costs.
How does car leasing work?
When leasing a car, a basic distinction is made between mileage leasing and residual value leasing. With mileage leasing, in addition to the term, an upper limit on the mileage of the car is agreed in the leasing contract. If the limit is not reached, customers will receive a refund after the contract expires. If it is exceeded, additional payments are due. In contrast, with residual value leasing, the value of the vehicle is crucial. At the beginning of the contract it is stated how much the car should still be worth at the end of the term. This will then be determined by an appraiser after the car has been returned. Any differences in the contractually agreed and actual residual value are compensated either by the provider or the customer.
This is what you should pay attention to when leasing a car
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Car leasing: What is the leasing factor and how does it help you find good deals?
In order to find the perfect leasing offer, there are various points you should consider. In addition to the desired vehicle, this includes, for example, the term of the leasing contract (which in turn influences the monthly leasing rate), the agreed mileage or residual value of the car and the so-called leasing factor. This is a value that results from the monthly leasing rate and the gross list price of the car and is used as a comparison value for various leasing offers. The lower this value is, the better the offer. Finally, car leasing often involves provision and delivery costs, which should be taken into account before concluding a contract. These can be evaluated based on the total cost factor, which, in contrast to the leasing factor, also takes additional costs into account.
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Total cost factor for car leasing: What it says and how you calculate it
If you want to lease a car, it’s worth comparing different offers in advance. Many providers have time-limited promotions with attractive deals and low leasing rates, some of which are less than 100 euros per month. You can find a comparison with current offers for cheap car leasing here. It’s best to simply scroll through the following list of comparison offers!
Comparison: Cheap car leasing offers in May 2024
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Further useful information about car leasing
What else should you know about car leasing? Here we have a few important tips for you to help you make the right decision when leasing a car.
The most important tips for car leasing
As a rule, the vehicle must be returned at the end of the leasing term. Therefore, you should handle it carefully, as you will be asked to pay for any damage. Although repairs can be carried out, they usually have to be carried out by authorized workshops. This can quickly become expensive because you are tied to specified partners and cannot obtain and compare your own offers. As a lessee, you are also responsible for the car and its maintenance and insurance. Here, too, in most cases you cannot go to just any service provider, but you have to adhere to the leasing partner’s regulations. That’s why many dealers offer service packages that include services such as maintenance and care for a fixed monthly price. This can make sense if you don’t want to take any risks and want to keep your costs relatively stable from the beginning to the end of the term.
Car leasing: These are the advantages and disadvantages
The biggest advantage of car leasing is that you can get a new car without high purchase costs. Instead, you pay moderate monthly installments for a predetermined term (which is usually between twelve months and four years). The costs can be planned and managed because they are recorded in the contract. Another advantage of leasing is that you can simply return the car after the contract expires. This means you don’t have to resell it yourself if, for example, you want to switch to a newer model. Alternatively, many dealers also offer to take over the leased vehicles after the leasing term if you wish.
But leasing also has a few disadvantages that you should be aware of. Although all costs can be relatively planned, additional payments may be due – for example if you damage the car or exceed the specified mileage. With residual value leasing, you also take on a residual value risk by making yourself dependent on the appraiser’s assessment. The biggest disadvantage, however, is that leasing contracts are so inflexible. This means: There is usually no chance of terminating the contract before it expires and you have to continue paying your monthly installments until the end of the one to four year term.
Conclusion: How useful is car leasing?
Car leasing can make a lot of sense if you want a brand new vehicle without having to take out a loan or put up a lot of equity. Since you’re not buying the car yourself, leasing allows you to switch back to a brand new car after the contract expires without having to worry about reselling your current vehicle. The costs are relatively stable, which offers you great planning security. Since leasing contracts cannot be terminated, you should only commit to them if you are sure that you will need the car for the entire term. Also make sure that as a lessee you are bound to certain instructions from your contractual partner. We therefore recommend that you book service packages for maintenance and insurance. Although these additional options are usually a bit overpriced, they will save you valuable nerves and stress.
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