6 car-lease red flags to catch before you sign

A low monthly payment can hide an expensive lease. Here are the terms we flag most often on car leases.

1. A marked-up money factor

The money factor is your interest rate in disguise. Dealers can raise it above the "buy rate." Convert it to APR by multiplying by 2,400 and compare it to current rates.

2. A low mileage allowance

If the lease caps you at 10,000 miles a year but you drive 15,000, the overage fees at return can run into the thousands.

3. Full-price capitalized cost

The cap cost is the car's price for leasing purposes, and it's negotiable. If it's set at full sticker, you're leaving money on the table.

4. Vague excess wear and tear

Watch for strict definitions that let the inspector charge for minor dings and normal tire wear.

5. Steep early-termination penalties

Life changes. Make sure you understand the cost of ending the lease early, and whether a lease transfer is allowed.

6. Missing GAP coverage

If the car is totaled, GAP covers the difference between its value and what you owe. Confirm it's included.

Paste your car lease into Lease Checker and we'll flag these automatically.