| |
|
 |
| |
Lease Terminology
- Acquisition Fee:
This fee covers the cost of preparing and servicing your lease. If charged, this fee increases the carrying costs and must be included in the Total Lease Charges.
- Amount to be Amortized:
This is the difference between the Net Leased Vehicle Amount and the Residual Value and represents the Depreciation that you pay over the term of your lease.
- For example:
The Amount to be Amortized is calculated as follows:
Net Leased Vehicle Amount
Minus Residual Value
Equals Amount to be Amortized |
$20,000
-$12,000
$8,000 |
- Annual Percentage Rate:
The Total Lease Charges expressed as an annual rate.
- Default:
Default occurs when you fail to comply with any terms of the lease. Your lease will set out specific circumstances which will result in your being in default.
- Depreciation:
This is the loss in the vehicle's value that occurs over time. The longer you keep the vehicle, and the more you drive it, the more the vehicle will depreciate.
In your lease, the depreciation is referred to as the Amount to be Amortized.
- Excess Kilometre Charge:
The cost you face if you drive your vehicle more kilometres than the maximum stated on your lease. This charge is set out as a number of cents for each kilometre over the stated maximum, plus applicable taxes.
- Excess Wear and Tear:
Every vehicle will experience normal wear and tear from every day use. Excess wear and tear is over and above expected normal wear and tear. Your lease should describe what excess wear and tear means.
Examples of excess wear and tear include:
- Bald or Mis-Matched Tires
- Body Damage
- Missing Parts or Interior Rips & Tears
- Lease Term:
This is the number of months that your lease will be in effect.
- Leased Vehicle Amount:
This is the amount you and the leasing company agree on for the vehicle and any other items such as accessories, extra equipment, freight, applicable taxes (such as air conditioning tax) and pre-delivery inspection, where applicable.
Monthly Provincial and Federal/Harmonized taxes are not included and will be listed separately.
- Residual Value:
The Residual Value is, unless otherwise stated, the estimated wholesale value of the vehicle at the end of your lease.
- Total Lease Charges:
The Total Lease Charges are the total carrying costs you pay over the term of the lease. This amount is similar to the cost of borrowing charges on a loan. These charges represent a portion of your monthly lease payment, the other portion is depreciation.
|
|
|
 |
|
|
| |
|
| |
 |
|
Home Page
