Walking the Red Carpet of Ford Leasing

Regardless of which why you go about it, securing a new (or even ‘new-to-you’) vehicle is not something to go into lightly. To ensure your overall satisfaction and, ideally, a low-stress experience it comes down to introspection; asking yourself questions that demand honest answers in order to lead you to the vehicle and buying option that best fits your needs.

Many of today’s consumers proceed with a built-in acceptance that owning a vehicle is a never-ending series of car payments. The hope, in traditional car buying, is that the vehicle can be paid off early enough that it offers a long life of ‘payment-free’ use. Of course, success tends to vary, depending on each vehicle’s starting condition, history use, and maintenance (or lack thereof).

But in a world where style trends continue to evolve and technology becomes obsolete nearly as fast as our morning coffee grows cold, there are still a large percentage of drivers who prefer to explore the benefits of leasing programs. Based on the duration of the lease period, this ensures that the driver will always be able to enjoy a fashionable, and well-equipped late model offering without the long-term gamble.

Granted, this comes with acceptance of perpetual car payments (with no time off at the tail-end for ‘good behavior’). However, leasing is an enticing option for anyone whose lifestyle can meet the expectations placed upon a lessee. With that in mind, let’s explore leasing a little deeper and take a closer look at Ford lease deals in particular.

Difference Between ‘Financing Payments’ and ‘Lease Payments’

Having addressed our general acceptance that car payments are a necessary evil, it’s important to recognize the distinction between payments within a lease agreement, versus those associated with traditional auto loan financing.

When financing a vehicle, each monthly payment made to the lender is split between payment against the principal and interest. The end result of a properly executed car loan results in outright ownership, in exchange for payments equaling the sales price plus interest.

When leasing a vehicle, monthly payments can be significantly less. This is due to the fact that the lessee is paying nothing towards the principal, as the agreement is not designed to result in ownership. Each monthly payment is designed to offset the vehicle’s depreciation, plus the applicable finance charges.

Upside of Leasing

Breaking out the pros and cons of leasing, it’s easy to see the appeal. Consider the benefits of driving a late-model vehicle, still covered by the manufacturer’s original warranty. With lower payments, you can stretch your budget further, obtaining what might be a better-equipped vehicle (outside your budget had you attempted to finance it).

Since most lease agreements last 3 years or less, it could be argued that you’re driving the vehicle during its most trouble-free years. At the end of the agreement, you need not worry about the vehicle’s depreciation and how it will affect its trade-in value. You simply drop it off with the dealer, possibly initiating your next lease agreement.

Downside of Leasing

The primary downside of leasing (especially as a lifestyle) is that you will always have a car payment to make. While this might be agreeable to some, it’s important to recognize the expectations placed upon the lessee (and why).

First, lease agreements restrict the mileage you can put on a vehicle. Failure to adhere to these restrictions can result in penalties ranging from 10 cents to 50 cents for each additional mile incurred. This could make it less favorable for those whose lifestyles are based around extensive commuting or travel.

In addition, the condition of the vehicle must be maintained across the life of the lease. Wary of any wear and tear, this might discourage families with young children or those with active lifestyles or aggressive driving habits. This also restricts any significant modifications to the vehicle, preventing personalization.

Ford Red Carpet

Of course, not all lease programs are built equal. Traditionally, each is built upon three sets of expectations (i) leasing options on the front-end of the agreement (ii) expectations placed upon the driver during the lease period, and (iii) options on the tail-end of the agreement. With this in mind, let’s dive deeper into Ford’s ‘Red Carpet’ leasing.

On all new vehicles, Ford offers as many as seven mileage options, allowing a more diverse selection of drivers the opportunity to explore leasing. These options range from 10,500 to 19,500 per year, with the option of pre-purchasing additional miles as needed.

Recognizing that ‘accidents happen’ Ford’s Red Carpet Lease agreements provide gap insurance, waiving any between insurance payoff and outstanding lease balance (in the event that the vehicle is totaled). This limits the lessee’s burden to insurance deductibles and any outstanding charges against the lease (such as past due payments, if applicable).

For those whose budget allows for it, Ford also offers an Advance Payment Program allowing for all monthly lease payments to be consolidated into a one-time payment, which is then reduced.

Of course, there is the option of purchase a vehicle at the end of a lease agreement, as well.

Is Leasing the Right Choice for You?

The simple truth is that leasing is not for everyone. Often mistaken as an elitist comment, it’s important to understand that the misconception is one that’s easy to make.

Simplified, we mean that the expectations placed upon the lessee are intended to maintain the vehicle’s value for resale. In some circumstances, certain lifestyles may be better able to meet those expectations than others. Consider this before embarking on a lease agreement, as excessive wear and tear on the vehicle, or its’ interior, could result in significant penalties.

However, if you are well-equipped to shoulder the expectations of a lease agreement, there are many benefits to be enjoyed. From fashion-forward design to the flashiest accessories, it’s the automotive equivalent of walking the red carpet.