Leasing has been labelled as your cheapest ticket to keep up with the
industry’s hottest vehicles and trends. The jury, however, is still out
on leasing: with the industry long on hype and short on detail. It is
difficult to distinguish between a genuinely good deal and a downright
So how do you spot a good deal?
First, you need to find out if there are any down payments on the lease. A
down payment refers to the lump sum amount that you pay upfront, either in
cash, non-cash credit or trading allowance, to reduce your monthly payment.
You should think twice before putting money down on a lease: not only are
you getting a rough deal, as you’re essentially forfeiting the general rule
of leasing: not putting any cash upfront. But the money is not recoverable
at the end of your lease. There is another big disadvantage: in the event
your car is damaged or stolen, your insurance may not cover the gap on the value
of the vehicle and the balance of the lease. If this lease is for business
purposes always “DO THE MATH” once you have utilized the capital cost allowance
and the personal stand by charges purchasing is usually the better option.
If you are not sure of all the considerations it is well worth it to pay an accountant
$50.00 to do the comparison lease versus purchasing.