An Explanation of Frequently Used Lease Terms
Do you want to upgrade your current ride? If so, you may want to consider a Cadillac lease after you look through our Cadillac lease offers. As you investigate leasing, you may question the meaning of certain terms you’ll encounter.
To make things clearer, we’ve put together a list of common lease terms you should know. To learn the meaning of a term that’s not on our list, contact or visit Zeigler Cadillac of Lincolnwood.
Lease
A lease is a legal contract between a lessee and a lessor, which is a leasing company or dealership that retains ownership of the leased car. Your contract lays out the terms and conditions of your lease agreement, such as the money you’ll pay upfront, the monthly payments you’ll make, and any restrictions you’re obligated to abide by.
Term
Financing a car puts you on the path to ownership, but leasing doesn’t. Leases last for a pre-set term, which is normally expressed in months. A typical lease will remain in force for 24 – 48 months, with some agreements being longer and others shorter. At the end of your contract, you’ll return your leased automobile to our Cadillac dealership serving Skokie, IL.
Money Factor
As is the case with auto loans, leases include an interest rate. Your contract will include a decimal that’s known as the money factor. Multiplying that number by 2,400 will reveal your contract’s annual interest rate.
Capitalized Cost
Also known as the cap cost, the capitalized cost is the agreed upon sales price of the vehicle you want to lease. This cost isn’t the same as MSRP and it’s normally negotiable. The cap cost is what a dealer will use to calculate depreciation and the amount you’ll pay throughout your lease agreement.
Down Payment
Your down payment is the money you’ll pay when you sign your contract that’s separate from the security deposit you might have to provide. If you use our car payment calculator, you’ll see that the larger your down payment is, the lower your monthly lease payments will be.
Disposition Fee
Dealers assess a disposition fee at the end of a lease to cover the costs they’ll incur to prepare a formerly leased car for resale. You can often sidestep this fee if you lease another automobile.
Lease a New Cadillac Car at Zeigler Cadillac of Lincolnwood
Are you ready to put your newfound knowledge to work? Head over to our Lincolnwood, IL Cadillac dealership to lease one of our new Cadillac vehicles now.