Many personal finance blogs will tell you that leasing a car is a bad move, but that doesn’t mean it may never make sense to you.
You might like the idea of not having to worry about rising repair costs. Maybe you don’t want to go through the hassle of selling a used car on the street. Hell, maybe you just like the idea of driving a shiny new car every few years.
The whole point of managing your money smartly is so that you can afford to live the lifestyle you want. If you’re willing to cut the budget on car leasing in other areas, this is your prerogative.
That said, a lot of people have gotten into financial trouble by negotiating a car lease without doing any research.
11 tips for negotiating a car lease
1. Know your numbers
There are more components to a lease than just the monthly payments, so make sure you sit down beforehand and find out how much you can (and are willing to) spend:
- The deposit
- The total cost of the car (known as the “cap cost”)
- The mileage limit (i.e. how many miles you can drive per month on your lease before the leasing company charges for excess mileage)
- The buyout or purchase option price (i.e. what you have to pay at the end of the lease if you decide to buy the car).
If you have a vehicle that you want to trade in, visit Kelley Blue Book to find out how much it is really worth so that the dealer doesn’t underestimate you.
2. Know what you want
Showing up at a dealership with no particular car in mind is like showing up with a sign around your neck that says, “I’m open to the most expensive option you can sell me!”
Do your research in advance to find out which makes and models will work best for your needs, and also think seriously about the options that you cannot do without and which you can.
When you show up and know your stuff, you won’t be shoved in more car than you need to – and it also makes a solid first impression that you have the big picture and are not easily persuaded.
3. Get quotes in advance
Try contacting a dealer’s internet sales department for a quote before visiting the lot.
It’s pretty hard to be belittled by a salesperson when you already have an offer from their dealer.
4.Test the dealership (and the seller)
Most of us look at online reviews before trying a new restaurant. Why shouldn’t you do the same when you make a much larger purchase?
For example, Edmunds.com offers a Dealer ratings and reviews page where you can read the experiences of other customers at the local dealers.
It has that too clever strategy for screening potential sellers. (Did you know you can do this?)
5. Check dealer inventory
When your ideal car is in stock (read: sit in the parking lot and take up valuable space), you immediately have the upper hand in car leasing negotiations.
If a clerk from another location needs to get you a car, they can play the card, I’m doing you a favor by getting out of my way.
But if you offer to take a car from them you Can play the “I’m doing you a favor by helping you remove this from your property” card.
6. Have a good day
The old saying “never shop on an empty stomach” doesn’t just apply to grocery stores.
Visiting a dealer when you are no longer feeling in the game (hungry, sick, tired, etc.) will make you less clear and It’s easier to get a bad deal because you just want to get things over with.
Leave when you feel rested and ready to handle the stress of negotiating.
Also, try to start shopping for your next car before your current car completely collapses on you so that you don’t get stressed out making a quick purchase without thinking things through.
7. Bring a backup
Even if you feel pretty confident in your negotiation skills, it always helps to have someone with you to keep you on track.
Whether it’s a friend, family member, or coworker who can seem intimidating, bring someone with you to point out the pitfalls of a potential deal, remind you of your initial budget, and save you from any trickery to fall for.
8. Keep your phone outside
Numerous apps support you in real time when negotiating a car lease – even during the call.
TrueCar shows you what other customers have paid for similar cars at a dealer.
The Cars.com app Allows you to compare vehicles in stock at several local dealers and helps you calculate loan terms based on current negotiations or your budget.
Not only do these apps help you stay armed and ready to go, they also send the seller a clear signal that you are not someone to take away.
9. Check the date
Chances are, there’s an important piece of information that you likely overlooked while browsing the dealership for cars that could give you added leverage: the date of manufacture.
We all look at a car’s window sticker that tells us things like price and fuel economy, but don’t forget to look at the manufacturer’s sticker (usually found on a vehicle’s driver’s door). In the top left corner of the sticker you will see a date and month that will tell you when the car rolled off the assembly line.
The further back this date, the longer the car is in the parking lot – and the more the dealer had to pay the transport costs for it. Intentional meaning: You are ready to get rid of this car.
10. Negotiate a car lease like a purchase
One of the easiest ways to get yourself to spend more than you want is to just focus on paying a lease monthly. This gives the dealer a chance to quote you on other lease terms. (See this diagram of the “cash flow shell game” to see how that works.)
To get the best deal, first negotiate the cost cap as if you intend to buy the car outright.
Don’t mention leasing until you and the dealer agree on a price. Once that’s settled then You can address financing options (including leasing).
11. Be ready to go outside
If you have nowhere to go with a seller, don’t be afraid to just leave.
One of two things will happen: the seller panics and holds you halfway out the door to sweeten the deal, or they let you go – in which case, you can find a dealer who can is ready to work with you.
Kelly Gurnett is a contributor on The Penny Hoarder.
This article originally appeared on www.thepennyhoarder.com