Service Steers Lease in Right Direction
Although an estimated 40% of new car customers are leasing their cars these days, a large number of consumers still struggle with the complexities of the deals and don’t always negotiate effectively.
A lease is generally far more difficult to analyze than a loan, since it involves not only an interest rate but a front-end payment and back-end residual.
Dealers often push their manufacturers’ captive lease programs, although they have access to a wide variety of other leases offered by banks and other large financial institutions. For consumers, researching everything that is available is time-consuming or impossible.
LeaseWise, a program offered by the nonprofit consumer group Center for the Study of Services in Washington, D.C., is one way for consumers to obtain detailed bids for leases.
For a fee of $290, the group will negotiate with five dealerships for the best lease terms and provide a written report. If the consumer can find lower lease terms, the group will refund the fee.
“Consumers can negotiate on their own, but there are some real impediments to doing so,” said Robert Ellis, director of operations for LeaseWise. Of the large number of available deals, he said, “There is no way for a consumer to determine the lease terms offered by finance companies.”
Since the LeaseWise program began about 12 months ago, the group has negotiated about 1,000 leases. Under the program, a consumer tells LeaseWise the make and model of the car and Lease-Wise will provide a report offering the best prices from the five nearest dealerships.
Alternatively, a consumer can designate the five dealerships he or she wants the group to negotiate with. The dealers are committed to honoring the negotiation for any car of the same make or model on their lot. Optional equipment affects the final price. LeaseWise can be reached at (800) 475-7283.
For consumers who want to negotiate their own leases, there are also plenty of consumer guides that offer help.
Author Richard Kaye presents a load of advice in his book, “Lease Your Car for Less” (Teletravel Network Inc.). “An informed consumer is a dangerous weapon,” Kaye said. “If you walk in blind and haven’t studied at least superficially what leasing is all about, you are setting yourself up for something less than an attractive deal.”
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* Vartabedian cannot answer mail personally but will attempt to respond in this column to automotive questions of general interest. Do not telephone. Write to Your Wheels, 1875 I St. N.W. #1100, Washington, D.C. 20006 or e-mail to Ralph.Vartabedian@latimes.com.
