To avoid getting shock when you turn in your lease vehicle, be aware of the 3 areas of the lease where most of the extra charges come up.
Disposition fee: the charge levied by the leasing company if the lessee doesn’t buy the vehicle at the end of the lease. This covers the expenses of selling, or disposing of the vehicle, administrative charges and other penalties. Make sure this fee is stated clearly in the contract and is agreeable by you before signing.
Excess mileage charges: The number of excess miles is determined by subtracting the total allowed mileage over the term of the lease from the actual mileage on the car’s odometer. Typically, a lease allows the driver 12,000 miles each year, but this varies depending on the value of the car leased. Cars with a higher retail price will have higher excess mileage charges.
Excess tear-and-wear charges: “This is deemed any excessive damage done to the normal tear and wear of the vehicle.” Notice the use of the terms “deemed”, “excessive” and “normal”. These are relative terms and it’s up to the leasing company to “deem “the damage and determine the charges.
Most used-car deals don’t come with a warranty. These are what you call “as-is,” which means that if you encounter any problems after you’ve signed the deal, you will be held responsible for any damages. The exception to this are certified used cars, for which the dealer provides a limited warranty. But these warranties, as mentioned, have limited coverage and are good for a relatively short period of time.
If your leased car is damaged prior to the end of the lease, you may find it cheaper to repair the damage yourself or have it repaired than pay the excessive charges of leasing companies.
Scott Stephens is a spokesperson for Auto Repair Report. Auto Repair Report teaches drivers how to save thousands of dollars on Auto Repair costs… Without needing to become a mechanic! Check it out today!