Buying lease returns: Cheap used car alternative?
Lease returns are well-maintained, inexpensive and have high-quality equipment. This makes them sought-after used cars. We show you the advantages and disadvantages of lease returns, what they cost and what possible alternatives there are.
Buying a new car is often associated with high acquisition costs. For this reason, leasing a car is an inexpensive alternative for many. If the lessee decides to return the vehicle to the lessor at the end of the contract period, it will sooner or later end up on the used car market. A cheap alternative to a new car.
As a rule, lease returns are vehicles from individual or fleet leasing contracts. In addition, leased vehicles are contractually obliged to undergo regular maintenance in brand-name workshops, so that any defects have been noted or have already been repaired. An additional security for you when buying. Appropriate documents for the sale should then be enclosed.
What are lease returns?
At the end of a leasing contract, the lessee has two options: to buy the vehicle or to return it. If he decides to return the car, the car becomes a lease return and thus a used car. The lessor now determines whether to offer the car again for leasing or for sale. The former is done through used car leasing, although there is now also the possibility of leasing used e-cars. The latter takes the form of an auction or by selling it to a used car dealer.
Due to the low residual value, the vehicles are usually available at favourable conditions. Usually, these are between two and four years old. Lease returns are well maintained, regularly serviced and have high-quality equipment, which makes them sought-after used car alternatives. Is a lease return too old for you? Maybe one-day registrations or demonstration cars are right for you?
Buying lease returns: advantages and disadvantages
As with everything, there are advantages and disadvantages to lease returns. We'll tell you what the pros and cons are.
Benefits of lease returns
Lease returns bring some advantages, especially from a financial point of view. Depending on the term, these are models with a young model year and above-average equipment. Former company cars in particular often have an automatic transmission, heated seats and leather seats in addition to a navigation system. Existing damage is repaired by brand workshops, as maintenance and care are contractually stipulated.
The vehicles are serviced and usually have only one previous owner. Likewise, the depreciation of a new car in the first few years of registration is particularly high and is largely borne by the lessee. Consequently, the purchase price of a lease return is significantly lower than comparable vehicles.
Disadvantages of lease returns
Lease returns usually make a good impression on the outside, but have a high mileage. This applies primarily to company vehicles in the field.
The appreciation of the vehicle is often lower and the wear and tear is correspondingly high. Therefore, the car should undergo a thorough inspection before buying it to uncover hidden defects. In principle, it is advisable to look for leased vehicles that have been used privately and have a lower mileage.
It should be noted that the majority of returns are station wagons with diesel engines – ideally suited as company cars. Small cars, on the other hand, are rather rare.
Where can I buy lease returns?
Years ago, lease returns were offered exclusively for commercial leasing. But the interest of private individuals increased significantly. In the meantime, returns can be purchased from used car dealers, intermediaries, online platforms and brand workshops.
Lessors also offer the vehicles by means of auctions. The advantage: If you buy directly from the lessor, you save the profit margin due to the intermediary.
What you should consider when buying lease returns
Are you looking for a used car? Then a lease return is a cost-effective alternative. Especially with common models, the selection is large. But what do you need to consider when buying? Basically, you should inspect the vehicle for hidden damage and any defects. Even if the car is thoroughly examined by appraisers when it is returned, it is worthwhile to obtain an opinion from an independent body in case of doubt.
Since company cars often involve a high level of wear and tear, returns with a rather lower mileage are recommended. Otherwise, follow-up costs may arise due to repairs. For this reason, lease returns from private use are preferable. This is usually handled with care, as too much wear and tear when handing over the vehicle leads to additional costs. Also take a look at the checkbook and the valid TÃœV seal.
Purchase criteria at a glance:
- Lowest possible mileage
- Check hidden damage and defects
- Prefer returns from private use
- View the checkbook
- Valid TÃœV seal
How much do lease returns cost?
Lease returns are usually premium vehicles at low prices. A good way for you to finance your dream vehicle. The attractive conditions are due to the initially high loss of value, for which the lessee pays for the most part.
This is around 25 percent in the first year after approval and settles at 5 to 6 percent after several years. This is also noticeable in the purchase price of a lease return, which is significantly lower than comparable vehicles. Depending on the vehicle model and owner, a discount of 60 percent on the new car price can be expected. Returns can be paid for in cash as well as financed via the retailer or bank.
What alternatives to returns are there?
If you decide not to buy a lease return, you have the option of buying a year-old car with hefty discounts, a stock vehicle or a new car with a one-day registration. Year-old cars are generally first-hand used cars that have been driven for a maximum of 12 months after the first registration. Here you usually also have the opportunity to take out a used car leasing. Often there is used car leasing without a down payment, as the value of the vehicle is already lower than with a used car, so you can lease without large one-time payments.
A new car that is registered for only a single day has the advantage of greater room for negotiation on the part of the dealers. The vehicle is not moved and has a mileage of almost zero. At the same time, there are attractive purchasing conditions for both buyers and sellers. Stock vehicles can be already produced new cars without registration and kilometers driven. You are less flexible in the desired equipment, but storage trolleys are immediately available and there are often good discounts.
Other alternatives are so-called vehicle rental concepts, such as short- and long-term rental. The former includes renting a new car for a maximum of one month. In the case of long-term rentals, the rental period is based on individual needs and can be chosen freely. The minimum term is one month. Except for fuel consumption, all costs are included in the price. In addition, depreciation and maintenance costs do not play a role.
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