Buying a car is a relatively straightforward process. Leasing, on the other hand, can be a little more complicated. If you have never leased a car before but are planning to get a Volkswagen lease, one of the first things to do is get to know these lease terms.
Term
The term is the amount of time for which you will be leasing your car. A short-term lease could be 12 months, while a long-term lease may be up to 60 months.
Money Factor
In addition to your lease payment, you will need to pay interest. This is what the money factor is, and it will look something like: 0.0025. You can multiply that by 2,400 to figure out what your rate would be.
Capitalized (Cap) Cost
The cap cost is the entire amount of the lease that you will need to pay.
Capitalized Cost Reduction
This refers to anything that could cut your cap cost, such as the value of a trade-in car.
Residual and Depreciation
The residual is what the car will be worth when the lease expires. It will have lost some of its value, which is what depreciation is.
Gap Insurance
Gap insurance is very important when leasing a car. If it were to be totaled in an accident or stolen, this will cover any costs that your car insurance wouldn’t.
Learn More About Leasing from Patrick Volkswagen
If you would like to get more information about leasing, feel free to get in touch with Patrick Volkswagen near Worcester, MA. You can also come down to see us to learn about our lease offers and to take some test drives.