Lease Acquisition Fee
Leasing a car is a great and economically viable choice if you plan on getting a new car every two to three years. However, when leasing a car, you need to consider all the costs and fees associated with leasing to fully understand your situation and secure the best deal possible.
One common fee that you may encounter is a lease-acquisition fee, also known as an administrative fee or bank fee. This charge covers the leasing company’s administrative expenses. For example, if you are trying to lease a car, but the leasing company needs to pull and review your credit reports, the lease-acquisition fee accounts for that administrative action.
While the lease-acquisition fee won’t be the only additional charge you encounter, it can significantly increase your overall lease expenses. Always ensure that you review your lease terms when leasing a new vehicle so you can find out how much the leasing company charges for the lease-acquisition fee. Being well informed and fully understanding the costs involved in leasing will make sure you are getting the best deal, and will better prepare you to negotiate a discount.
How can I find the lease-acquisition fee?
The leasing company is required by law to provide written disclosures of the costs and terms of the lease if it meets certain requirements. The lease agreement should contain important details about the lease and should also include the lease-acquisition fee itself. Be sure you read the fine print and understand the details before signing so you aren’t surprised with any additional costs.
So how much are lease-acquisition fees typically?
When you lease a car, the company is able to charge a fee to organize the whole deal. There is no fixed value for a lease-acquisition fee, however, you can expect this charge to range anywhere from $395-$895. More expensive cars, however, can come with an acquisition fee above this range, so understanding the quality of the car you are leasing will help give you a better idea of the cost of your lease-acquisition fee.
Another factor to consider regarding the cost of lease-acquisition fees is the payment plan. You may be able to choose whether you want to pay the fee upfront or include it in your monthly lease payments. Most of the time, the lease-acquisition fee will be included in the Capitalized Cost so that it is rolled into the monthly lease cost. If not, the fee will be due up front at signing. If a car dealer is arranging the lease, make sure they’re not raising the cost of the lease acquisition fee. Some leasing companies allow the dealers to mark up this fee a few hundred dollars and keep the difference. Be aware of hidden fees in your gross capitalized cost, as this could mean you will have to pay more if you choose monthly payments rather than paying upfront.
Is it Possible to Negotiate a Lease-acquisition Fee?
If you are planning to lease a car, be prepared to negotiate. There are many different factors of the lease that are negotiable, such as the vehicle value, interest rate, trade-in value, and more. However, keep in mind that negotiable parts of the lease can vary from lender to lender.
When trying to negotiate the acquisition fee, don’t stop there if you can’t successfully negotiate a deal. If you cannot directly negotiate the lease-acquisition fee, there are other factors of the lease you may be able to negotiate to offset the cost of the lease acquisition fee. Make sure the vehicle cost matches the best deal you can get. Even though you’re not actually buying the car when leasing, the vehicle’s value and depreciation are still taken into account in a lease.
Is Leasing Right For Me?
Leasing a car can be a complicated, expensive process. Before signing a lease, make sure you review all the surrounding costs, like the lease-acquisition fee, among other fees. If you take the time to understand all the charges and details of the lease, you may be able to negotiate a lower cost. However, if negotiating the lease-acquisition fee is not an option, be sure to try to negotiate other costs of the lease to help offset the cost of the lease acquisition fee. When leasing a car, always make sure you understand every aspect of the lease; don’t just sign everything and agree to the costs without taking the time to read it thoroughly. With a full understanding of the leasing costs and some negotiating, you can ensure the best possible price and outcome for your lease.
