Buying a new vehicle can be overwhelming. Oftentimes, shoppers get particularly overwhelmed with the financing process and all the decisions they have to make. To help you better understand the financing process, we're outlining some common Toyota lease terms that you'll hear at Bell Road Toyota.
What are the Benefits of Leasing?
Have you been considering leasing a Toyota vehicle? Did you know that it can be much more affordable than financing? This can give you more options when it comes to shopping, particularly if you're shopping on a limited budget. Plus, you’ll enjoy all the benefits of driving a new vehicle, including:
- Newer styles and features
- Less mechanical issues
- Warranty coverage
How Does a Lease Work?
A lease is essentially a long-term rental, as most lease contracts last around two to three years. Your total investment for your lease is determined by looking at the total value of your vehicle and its estimated value at the end of your lease.
Over the course of your lease, you will make monthly payments to your lender. Then, you’ll simply return your vehicle at the end of your term.
Common Lease Terms
- Closed-end lease: With this type of lease, you don’t have to pay the difference between the residual and market value at the end of your lease.
- Open-end lease: This type of lease requires you to pay the difference between the residual and market value.
- Termination fee: This is the amount you must pay at the end of a closed-end lease if you don’t want to pay the residual value and instead want to buy the vehicle.
- Mileage allowance: This is the total amount of miles you can drive per year without a penalty fee.
- Lease fee: This is the cost of leasing a vehicle (also known as the rent charge or implied interest).
Still have questions? Our financial experts at our Toyota dealership in Phoenix, AZ are happy to help!
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