Can you predict how much you will drive your car over the next year or two? Sounds tough and a bit redundant as well. But do not dismiss it so soon as one important feature in car leasing is the cap on the total mileage of the car. This means that the leasing company will pre-fix an annual mileage for the period of the lease.
The mileage restriction for leased cars is generally in the range of 10,000 to 15,000 miles. But you are always free to choose a higher mileage band depending on how much you plan to use the car. Some car lessees even go up to 40,000 miles. But these extra miles that you purchase upfront will obviously cost you more, over and above the fixed monthly lease charges. Extra miles are generally calculated on a per mile basis and can cost quite a bit.
But what happens if you are found exceeding the mileage restriction at the end of the lease period? You are liable to pay excess mileage charges which can be pretty steep. This is to compensate the car leasing company for the extra depreciation of the vehicle due to the excess use.
Therefore, you have to be very cautious when opting for say, a Mercedes car leasing. Estimate your driving pattern and requirements before arriving at an estimate of the number of miles you expect to drive the car. Also pay attention to the excess mileage charges that are agreed in advance and specified in your lease contract; this penalty can sometimes be quite exorbitant.
So, is it better to err on the side of caution and opt for a higher mileage than your estimate? In other words, should you go for an 18,000 miles contract if you think you will be driving around 15,000 miles per year?
Well, not really as your lease contract price will go up with the increase in allowed mileage. This means that your monthly lease payment for 18,000 miles restriction will be higher than what you will have to pay for a 15,000 mile restriction. This is because the more miles that your Mercedes car leasing covers, the lower will be its depreciated value at the end of the lease contract. On the other hand, there is no rebate at the end of the lease term even if you happen to be significantly under the mileage limit!
The only way out is that you should be very careful while fixing the mileage restrictions without trying to be on the safe side either. Just be vigilant during the period of the contract and use the leased car judiciously. There is nothing to lose as long as you stay within the mileage stipulation.
So enjoy your leased car and drive it wherever you want, but always keep an eye on what the milometer reading is trying to tell you!
Author’s Bio: This article is written by Brad Carlton about the car leasing.The cap on the total mileage of the car. This means that the leasing company will pre-fix an annual mileage for the period of the lease.