Posts filed under 'Car lease explained'
Reader’s Question:
I don’t own a car. What if I lease a car? Will I still need auto insurance?
Frances
Austin, TX
Leasing is fast catching up. A lot of people are into it. It is the advisable thing to do if you want lower monthly payments, a new car every couple of years and the benefits that go with a new car, like the latest safety features and high-tech automobile gadgets.
However, even if you don’t own a car and you go ahead and just lease one, you would still need to have auto insurance. It’s not legal to drive around the state of Texas without auto insurance coverage. You can not legally drive around Austin, TX, without insurance. Besides, the auto dealer or bank that will be financing the car lease will require you to have collision and comprehensive coverage. Collision insurance coverage takes care of the damages to your car if you collide with another car or object. Comprehensive insurance, on the other hand, pays for the damages to your vehicle caused by anything other than collision. This would include vandalism, natural disasters and even theft. You have to understand that when you lease, the car belongs to the company. They would want to make sure that their property will be properly covered and taken care of while you’re using it. You need to have these policies required by the car company and also liability insurance as this is required by the state.
Tags: auto insurance, car insurance, leased car insurance
November 20th, 2008
Reader’s Question:
My father and I just leased a vehicle. The problem is that I have a revoked drivers license and the dealership wants to exclude me and the auto insurance company will not exclude me. Can you tell me what to do?
Brian
Dallas TX
Most car insurance providers will not exclude you if the policy is under your name - meaning you are the named insured. The auto insurance policy will probably need to be in your father’s name - if they exclude you to the auto insurance policy. However, you will not going be covered to operate the automobile if you will be excluded to the car insurance policy. I suggest that you get your drivers license restored as soon as possible. Even though the dealership would want you to be excluded, you will have to verify with the car company to be certain it is ok for you to be excluded.
November 19th, 2008
Reader Question
I want to lease a new Toyota Prius…..damn gas prices are out of sight! The dealership wants to charge me a bunch of smaller “Fees” in addition to the lease fee, what should I do….go to a bank for a lease?
Tom,
Detroit, MI
Dealerships value your business and are ready to negotiate. Mention important options before you seal the deal. Dealers know that some people like to swap cars often and want the flexibility to get out of a particular car when they choose.
What the dealer doesn’t tell you is that leasing is designed in a way that makes it both difficult and expensive to terminate before the normal end date. Dealers also try to sell you on leases by doing a comparison between the payments for a lease and the payments for the same car on a conventional loan. Invariably, the comparisons show the lease payment to be the winner. Most banks will not offer a car lease, but there are a few aftermarket companies that will…so shop around.
July 31st, 2008
Reader Question When did auto leasing become so popular? It seems every TV advertisment is for car leasing not car buying? What happened to the old car buying days?
Jerry,
Dallas,TX
Perhaps as recently as 8 years ago, most auto consumers had never really heard nor considered leasing a viable options for their auto financing.
Today, leasing accounts for nearly 35% of total auto sales in America (that?s more than double that of the previous decade)! Perhaps, the most important thing to keep in mind is experience. In fact, that may be why you are seeking professional help instead of trying to restore your own muscle car.
Perhaps more importantly, this angle helps to solve the incentive mess that manufacturers dug for themselves with 0% financing and ever-spiraling rebate deals. They started in the 1980s with Lee Iacocca’s “buy a car, get a check” $50 rebate campaign.
April 16th, 2008
Reader Question: Hi, can anyone please explain the whole auto leasing concept to me in laymans terms?
Thanks,
Tom, Atlanta GA
Hey there Tom,
Car leasing (auto leasing) is essentially a way of obtaining a vehicle for a set period of time. Leasing is not renting and renting is not leasing, nor is it financing.
Auto leasing is a popular option for people who want to keep changing their cars every few years without having to bother about selling old ones or buying new ones.
Most people find leasing from a consumer friendly company convenient, time saving and efficient. Auto leasing is a great option for companies since the payment is 100% tax deductible. Its also a great way to drive a new car every two years so long as you don’t go over mileage limits.
April 16th, 2008