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AUTOMOBILE LEASING AND RENTING

Requirements
Q. What are the prerequisites if I want to rent or lease a car?
A.
First, you must have a valid driver's license. Increasingly, you may be required to show
a good driving record. In several states, the major car rental companies have electronic
links to government computers and are obtaining driver records (motor vehicle reports)
when someone wants to rent a car. They refuse a rental contract if the driver has had too
many accidents or violations on his or her record. Some of the major rental and leasing
companies set a rental age minimum of eighteen and require a major credit card. Other
companies rent only to credit card holders aged twenty-five or older. The company may
waive the age requirement if you have an account number in your name through a motor
club or other association, or if you have a rental account through your business. You must
sign a contract when you rent or lease a car.

Q. How does leasing differ from renting?
A.
A lease is essentially a long-term rental. Leases usually have a one year minimum.
Rentals may last one day.

Lease or Buy?
Whether it is better to lease or buy a car depends on many factors. A car lease means
lower monthly payments. After all, your installment payment depends on the purchase
price minus the car's estimated value at the end of the lease term. Thus, your installment
payment does not depend on the full value of the car. Leasing usually avoids a down
payment and sales tax. There also may be tax advantages if you lease mainly for business
use. On the other hand, a leased car does not gather any equity (cash value). Buying a car
on credit does. Finally, when your lease is up, you must return the car.


- Car Lease Contracts
- Car Rental Contracts

 

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