Question

Which statements apply to leasing a car? Check all that apply.

The car may be driven as much as needed.
Payments are generally higher than buying.
There are mileage restrictions on the car.
You must return the car after the lease ends.
There are penalties for ending the lease early.
You can sell the car to someone else after the lease ends.

Answer 1

Correct (apply to leasing a car)
- There are mileage restrictions on the car. — Most leases include an annual mileage limit and charge per mile for excess.
- You must return the car after the lease ends. — Standard leases require returning the vehicle unless you exercise a purchase/buyout option.
- There are penalties for ending the lease early. — Early termination fees or payoff obligations commonly apply.

Not correct (do not generally apply)
- The car may be driven as much as needed. — Not true for typical leases because of mileage limits.
- Payments are generally higher than buying. — Monthly lease payments are usually lower than loan payments for buying the same car.
- You can sell the car to someone else after the lease ends. — You can only sell it if you first buy out the lease; otherwise it must be returned to the lessor.