Factors To Consider at End of Lease

Factors To Consider at End of Lease: Brattleboro Ford

If your vehicle lease is coming to an end, it’s important to carefully consider your options. The automotive industry is still facing challenges, such as the computer chip shortage, which has resulted in a slow recovery. As you approach the end of your lease, there are a few key factors to keep in mind.

Car Depreciation and Residual Value

Leasing a car means making monthly payments based on the estimated depreciation of the vehicle during the lease term. Unlike financing a purchase, you won’t be building equity in the car. However, at the end of the lease, there is a residual value, which represents the estimated worth of the vehicle. This residual value is the buyout price if you decide to purchase the car.

Lease Buyout Price vs. Market Value

Before making a decision at the end of your lease, it’s essential to evaluate the numbers. Ask one of Brattleboro Ford’s sales staff to determine the range of value for your vehicle. It’s possible that the residual value of your leased car is lower than its current market value. This is due to the rapid increase in used car prices in recent years. If you’re satisfied with the car you’ve been driving and it hasn’t given you any issues, purchasing it may be a cost-effective option.

Drawbacks To Purchasing Car and Selling for Profit

If you choose to exercise the buyout option and purchase the leased vehicle, you may have the opportunity to sell it for a profit. However, there are some drawbacks to consider. The paperwork involved and potential tax obligations may discourage some private sellers from pursuing this option.

Car Availability Can Still Be Scarce

Returning the leased car or purchasing it to resell raises the question of finding your next set of wheels. It’s important to note that specific trim levels with desired options and colors may have limited availability. Factory orders may be necessary to secure the model with the features you want. While inventory levels are improving and incentives are returning, locating the exact car you desire can still be challenging.

Extend Your Car Lease

If you haven’t found the right vehicle for a new lease but wish to continue leasing, most lessors offer extensions on a month-to-month basis or for a fixed number of months. This allows you to keep making monthly payments while you search for your next car, and you’ll likely need to sign another contract for the extension.

Considering these factors and your unique situation will help you make an informed decision at the end of your car lease. Whether it’s purchasing the vehicle, exploring resale opportunities, or extending the lease, carefully evaluating your options is crucial.

Tags: Brattleboro Ford, buying a car, car lease, end of lease, new ford
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