How does leasing work in Calgary?


How does leasing work in Calgary?

Car leasing is not the same as car buying or renting a car. Whether you are about to lease a new car or deciding what to do at the end of your current lease, it is important that you understand the basics of car leasing. At Pfaff Leasing, we make it very easy for you to lease a vehicle of your choice. We have a wide variety of different types of vehicles available for lease. Whether you are looking for a sports car, performance car, luxury car, or even a vintage car, Pfaff Leasing can get you behind the wheel. With all of this being said, we still like to make sure our customers are well informed about the car leasing process, which is why we have compiled a blog with some information about the process. Read on!

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What is a car lease?…

 A car lease is an arrangement in which you pay your leasing company for the right to drive your leased car. Your monthly payments do not build equity (i.e. ownership) for you in the car. Rather, as you make your monthly payments you are simply upholding your side of the bargain that allows you to drive the car for a specified period of time, usually two or three years.

What do my monthly payments go towards?…

Like all cars, as you drive your leased vehicle it depreciates in value, meaning the price it could sell for on the open market decreases. To account for this loss of value, your leasing company requires you to pay for the value it expects your leased car to lose as you drive it. The depreciation cost is calculated by the capital cost and the residual value.

The money factor…

The other big piece that determines your monthly lease payments is your money factor, or lease factor. The money factor on a lease is like the interest you would pay if you took out a loan on a car. You pay money factor to compensate the leasing company for using its car and for the risk it takes by trusting that you will make all of your payments. Most lease agreements do not list what your money factor is. So, to learn what you lease factor is or will be, you can ask your Pfaff Leasing professional.

Leasing is a very common way to get behind the wheel of a vehicle for a lower cost. If you are interested in leasing a high-end or vintage vehicle, then Pfaff Leasing can help! For more information about leasing in Calgary, continue to browse through our website. Click here to find our contact information or to speak with a representative.