Have you been considering an Alfa Romeo lease from Helfman Alfa Romeo of Sugar Land? Noticed that the payments seem higher than the last time you checked? We’re outlining how leasing works and how their payments are calculated to help you decide if it’s a fit for you.
How Does a Lease Work?
When you lease a new vehicle, you are essentially paying to drive the vehicle, rather than own it. You’ll agree to a predetermined term and can drive the vehicle, as your own, until the term is up. Then, you return the vehicle to our dealership at the end, or opt to buy it, if it was an option originally stipulated in your contract.
How are Lease Payments Calculated?
When you determine a lease’s cost, we look at two key factors – the vehicle’s current value and its estimated value at the end of your lease. You will be responsible for paying for your lease’s depreciation in value. This helps make leasing much more affordable than financing.
Once the total cost is determined, it is divided into monthly installments. Keep in mind, you could have fees due at the end of your lease including extra mileage and excessive wear and tear fees, if applicable.
Why are Payments Higher Now?
Car values are largely dependent on market value, which factors in market conditions. Inventory is limited now, which makes vehicles more difficult to find. When supply is down, but demand is high, car prices increase.
With manufacturers struggling to keep up with demands, they are also reducing their manufacturer incentives. Many of the most competitive lease offers come from manufacturer incentives. So, without competitive incentives, the lease payments aren’t as competitive either.
Still have questions? Reach out to our Alfa Romeo dealership in Houston, TX – we’re happy to help!