7 Tips for Leasing Out Your Car
|Leasing out your car is one of the surest ways of making
some extra cash out of cars that you no longer use or when
travelling abroad. There are a number of car rental
companies that can help you lease out the vehicle to an
ideal client. Nevertheless, you need to consider a number of
factors so as to get the most value from the deal.
Here are 7 tips for leasing out your car that must be
considered before finalizing the deal.
Before the client can drive out of your residential premises
with the car, he or she is required to pay some amount of
money. Some of the payments include first monthly payment,
down payment, security deposit, freight and destination
charges, fees to cover registration and licensing of the
vehicle and list continues. The amount of money that should
be paid largely depends on existing state rules and
regulations as well as your personal preferences. If
possible, consult a financial analyst who specializes in
this industry to make an intelligent decision.
Terms and Conditions
Just like any other business deal, you need to formulate a
list of terms and conditions that the client must adhere to
otherwise the agreement can be considered null and void if
he or she fails to abide to the rules of engagement. For
example in closed-end leases, if the total value of the car
is less than the estimated amount at the start of the lease,
rental company or you, the sole owner of the vehicle is
required by law to absorb the cost. Based on this fact, it
is recommendable to carefully consider the type of lease and
the term and conditions to avoid regrets down the road.
Nowadays, insurance companies offer unique temporary car
insurance policies to clients who intend to lease out their
vehicles for a limited amount of time. One of the major
benefits of having such a policy is that it covers you from
unforeseen occurrences that could occur such as accidents
and burglary. You should take time to read and understand
the policy documents before signing to get the best results.
It goes without saying that you should choose a company that
has a positive reputation and legally accredited to avoid
wasting your hard earned cash on dubious insurance deals.
Duration of warranty
If you decide to lease out the car for the length of
manufacturer’s warranty, you will not cater for major
maintenance and repairs. Instead, the manufacturer will come
in and carry out all the repairs for free. Hence, it is
advisable to first look at the manufacturer’s warranty cover
when determine the number of months or years that you intend
to lease out the car.
There is no guarantee that the client will obey all the
terms and conditions. You should always expect the
unexpected by including a clause detailing how premature
termination of the lease can be executed. Ideally, you
should ensure that the client clearly understand the
repercussion of not adhering to the agreement before signing
it to avoid legal tussles.
How will the car be used?
This is one of the most important questions that you should
never fail to ask yourself when leasing out the car. For
example, there are clients who lease cars for strictly
business needs, that is, they use the car to drive to their
customer’s offices or transport merchandise to stores, malls
As the owner of the car, it is of paramount importance to
first understand how the client will be using the car. Such
information will help you determine the kind of insurance
cover that you should apply for as well as the charges. More
importantly, the terms and conditions should be relevant to
the manner in which the car will be used. Take time when
doing this to avoid making uninformed decisions.
One of the surest ways of determining credibility of a
particular client is by carry out a background research.
Nowadays, there are several online tools and websites that
you can use to do this from the comfort of your home or
office. Steer clear of clients with bad reputation or poor
credit rating to be on the safe side.
Finally, consider involving a lawyer when signing the deal
to make it a legally abiding. Leasing out car to prospective
clients is a ideal way of making money out of your car.