Lease 101

Who are you really negotiating with?

Obviously you want to find a great deal, but negotiating a great deal starts with understanding the few key areas that will affect your lease. By trying to negotiate the wrong items you may confuse yourself and allow the dealer or the leasing company to take advantage of you.

Let’s review what factors each entity controls:

Dealer Bank You
Capitalized Cost Money Factor

Residual
Term

Mileage Allowance

Contrary to popular belief, you can see the dealer only controls one of the 5 factors that make up your lease deal. Because the dealer often represents the leasing company, consumers believe he controls the rates a bank charges or other factors, like mileage allowance. By knowing where the decision points are being made, you can focus in on the only contributing factor the dealer really controls – the capitalized cost. You can then work either directly with the leasing company or manage your Money Factor and Residual through the dealer.



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