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Leasing Under the federal Consumer Leasing Act, you, the consumer,
have a right to information about the costs and terms of a
vehicle lease. This information will help you compare lease
offers and negotiate a lease that best fits your needs, budget,
and driving patterns. This consumer guide is for a closed-end
lease, the most common type of vehicle lease. With a closed-end
lease, you may return the vehicle at the end of the lease
term, pay any end-of-lease costs, and walk away. The sample
leasing form shows the types of information the dealer or
leasing company must give you before you sign a lease. "Leasing
language" gives definitions of terms associated with
vehicle leasing. Leasing You do not own the vehicle. You get
to use it but must lease
return it at the end of the lease unless you choose to
buy it. Leasing Up-front costs may include the first month's
payment, a refundable security deposit, a capitalized cost
reduction (like a down payment), taxes, registration and other
fees, and other charges. Leasing Monthly lease payments are
usually lower than monthly loan payments because you are paying
only for the vehicle's depreciation during the lease term,
plus rent charges (like interest), taxes, and fees. Leasing
Most leases limit the number of miles you may drive (often
12,000-15,000 per year). You can negotiate a higher mileage
limit and pay a higher monthly payment. You will likely have
to pay charges for exceeding those limits if you return the
vehicle. Leasing Most leases limit wear to the vehicle during
the lease term. You will likely have to pay extra charges
for exceeding those limits if you return the vehicle. Leasing
At the end of the lease (typically 2-4 years), you may have
a new payment either to finance the purchase of the existing
vehicle or to lease another vehicle. Leasing You are responsible
for any early termination fees or charges if you end the lease
early. Leasing You may return the vehicle at lease end, pay
any end-of-lease costs, and "walk away." Leasing
The lessor has the risk of the future market value of the
vehicle. Consider beginning, middle, and end-of-lease costs
At the beginning of the lease, you may have to pay your first
monthly payment; a refundable security deposit or your last
monthly payment; other fees for licenses, registration, and
title; a capitalized cost reduction (like a down payment);
an acquisition fee (also called a processing or assignment
fee); freight or destination charges; and state or local taxes.
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