Car leasing is a method of paying for using the car on a fixed time period. It is very similar to renting only variation here is; you go to pay him for the whole period you signed to use the vehicle. It clearly means to say that instead of hiring, say for a day, you pay for minimum 1 year to maximum period of 3 years.
And keep in mind that it does not own the vehicle, rather hiring for a longer period. And you need to undergo contract signing agreeing for using the car in tenure period, norms applicable, and other clearance formalities.
Here you are not buying the car, instead you have temporary period to own. The car you would like to lease has retail value, in terms of leasing the values of car is termed as ‘residual value’ – an appropriate estimate of the car on the lease closing date, which is taken into account after depreciation. And even you don’t pay in full settlement, where you can pay on lower monthly payments. On the closing date of lease, you need to return back the vehicle to the owner or the leasing company. Also you may have an option of taking another new vehicle out a lease, or based upon the contract you agree, you can continue using the vehicle.
Actually speaking, leasing saves your money by paying low monthly payments when comparing other finance like loans et al. Leasing in now-a-days is very ideal in the market that enabling you to budget accurately.
It is not advisable on investing the money which don’t return profit and also which losing money. And where cars are depreciating in massive effect at the time and we all know this well in hope.
Car leasing doesn’t just make economic financial set up, there are good benefits and advantageous features that to be looked out more for clear perception.