Things to Consider Before Buying a Previously Leased Car
If you're looking to snag a great deal on a car, a previously leased car may be the way to go.
When it's time to buy a car, most of us consider three options: buying a new car, leasing a car, or buying a used car. If you decide to go the used car route, you can choose to buy a previously leased car, which can have some unique benefits and disadvantages worth taking into account.
Before you purchase a previously leased car, here are a few things to consider.
How Buying a Previously Leased Car Works
Buying a previously leased car (also known as an off-lease vehicle) typically involves buying a certified pre-owned (CPO) car. A CPO car must be reviewed carefully and vetted to be classified as a car that's in better condition than similar used cars. In general, CPO cars tend to be cleaner, have lower miles, and have a better history than other used cars. CPO vehicles also come with certain protections against pricey repairs or defects, thanks to an extended manufacturer's warranty.
Typically once a car lease ends, a dealership can certify the car as CPO if it meets certain qualifying standards after undergoing a multipoint inspection — such as being less than four years old and having less than 48,000 miles on the odometer.
To buy a previously leased car, you'll need to go through an auto dealer instead of a private seller.
The Potential Pros and Cons of Buying a Previously Leased Car
Purchasing a previously leased car comes with some key advantages and possible disadvantages that are worth taking into consideration.
- Good price for the value — as with buying any used car, you stand to save money by buying a previously leased car that may not be much older than a new car
- More time with the manufacturer warranty — while used cars that you buy directly from private sellers can be quite old, previously leased cars tend to be on the newer side and are more likely to have a decent amount of time left on the original manufacturer's warranty
- Car condition — because leases come with very specific rules about the length of the lease and mileage limits, the car must be kept in good condition to meet the lease agreement. Usually, this means previously leased cars were well cared for and shouldn't have too many miles on them
- Wear and tear — despite the fact that previously leased cars are usually in good condition, they will never be as pristine as a brand-new car
- Fewer advancements — if you're looking for the latest technology and safety features, you likely won't find them in a car that was leased for a few years
- Can be more expensive — a previously leased car will generally cost less than a new car (unless you choose a luxury model), but this type of used car can be more expensive than an older model you might find through a private seller or used car dealership
Does Buying a Previously Leased Car Cost More Than Other Options?
You may find that leasing a car costs more than buying a new car. Purchasing a previously leased car or a CPO instead of a normal used car can also be more expensive.
There are a variety of factors that determine the cost of a previously leased car, such as the make and model, condition, and current market prices. Generally, buying a previously leased car will cost less than buying a brand-new one, but that isn't always the case. Buying a gently used, previously leased car from a luxury automaker may very well cost more than buying a less expensive maker's base model.
Going with a previously leased car is not an automatic way to save the most money — instead, take some time to shop around for the best deal on a car to ensure it meets all of your needs.