Leasing a Car in London Ontario: Everything You Need to Know
Leasing a Car in London Ontario: Everything You Need to Know
Posted on October 25, 2022
Unless you live in an area of Canada where there is great public transit, you will need a vehicle to carry out normal day-to-day activities. One of the biggest questions you will need to answer when buying a new car is whether to buy or lease it.
We asked our London car loans team to discuss car leasing. We lease as well as buy and sell cars so are perfectly positioned to help.
What is car leasing?
There is a misconception that leasing a car is like renting a car. While there are similarities it is not the same thing.
A lease is a formal agreement for you to take control of a car for a set number of months. At the end of the lease, you have the option to buy the car for the pre-determined market value or return it to the dealership.
Inside the lease, some limitations are stipulated, the first being that you must always keep the car in a good state of repair and ensure routine maintenance is being performed.
You will need to keep copies of all work performed on the car, so when it comes time to turn in the car you can address any questions the dealerships have about the service record of the vehicle.
One of the most important requirements is to keep track of your mileage. Typically, the average driver puts 20,000 km on their car each year. If you take a 3-year lease then that means your mileage should be around 60,000 km +/-.
Inside the leasing agreement, there will be a section that defines how much you must pay per kilometer over the limit. This is a nominal sum but if you are going to be driving a lot for work i.e. Uber or DoorDash deliveries, then leasing may not be the right option for you.
The reason that there have to be limitations on the mileage is the vehicle will be resold. Mileage is a key influencer in the perceived value of a car, so factors in to the overall cost.
While there are a few restrictions, the upside of having a lease is your monthly payments are fixed and you can return the car at the end of the lease. This gives you the flexibility to always have a new car every few years.
Having a lease is great if you are running a business since the cost of the lease can be written off as a tax deduction. That’s not something you can do with a traditional car purchase agreement!
Finding the right car to lease
We touched on the pros and cons of auto leasing but something we need to discuss is finding the right local London dealership to lease the car from. You and this dealership will be entering into a long-term leasing agreement, so you want someone you enjoy working with.
The interest rate for car leasing in London is at unprecedented levels right now, so if you have decent credit you will have very competitive interest rates.
Now that you understand the finer points of auto leasing in Canada, why not book an appointment with Car Nation Canada Direct and go for a test drive? You could be driving a new car and be paying super-low interest rates in the process. What do you have to lose!
We will use all our skill and experience to deliver the lowest possible London auto loan rates, guaranteed. Contact Car Nation Canada Direct to learn how we can help.
For any questions or concerns, please don't hesitate to contact us here!
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