6. End of Lease Considerations
Aside from initial and continuing monthly lease costs, there may be final costs associated with leasing you should be aware of. These include charges for excessive mileage, excessive wear and tear, a vehicle resale charge and an end-of-lease payment. Let's look at them one at a time.
Charges for Additional Mileage
Most closed-end leases stipulate a set number of annual miles you may drive the vehicle. If you exceed this allocation, you may be charged for every mile over the predetermined annual limit. It is important to allow mileage that fits your driving habits before signing a lease. You may be permitted to "purchase" additional miles up front at a lower rate.
If you default on your lease obligations or fail to make your payments as in a loan, the lessor may repossess the vehicle and/or assess the cost or penalties stated in the lease. These may include forfeiture of your security deposit, immediate payment of all remaining obligations and the cost of legal fees to reclaim the vehicle.
Excessive Wear and Tear
All leases contain stipulations making you responsible for "excessive" wear and tear, which is usually defined as any wear and tear greater than "reasonable." To avoid any misunderstandings, be sure that specific definitions of "excessive" wear and tear and "reasonable" are included in your lease agreement.
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