Car dealers many times resort to some common tricks to fool you into a lease when it may not be your best interest. For that reason, it is important that you understand how the leasing process works and to be able to make your own choices, without the car salesman's help. In this article, we will disclose the top crooked techniques used by car dealers. Any one of these could cost you an arm and a leg. Just think how bad it could be if a crooked car dealer used more than one of these fraudulent leasing techniques on you.

1. "We will accept your old car as a trade-in, pay off your existing loan balance, regardless of how much you owe, and get you into a new vehicle for lower monthly payments."

This is definitely a bad deal. The reality of this situation is that if you owe more money than the value of your trade-in, the dealership will add the difference and factor it into the lease payments on your new vehicle. Your total monthly payment will likely be lower than you expected.

2. "We will make the remaining payments on your old lease if you lease a new car from us today."

Another crock! The reality of this situation is that the dealer is simply making your remaining payments and returning the car to the leasing company for you. If the vehicle has excessive mileage or wear and tear, the leasing company will hold you responsible for this and not the dealer. Should the dealer fail in making those final payments, the leasing company will hold you responsible and not the dealer. If the dealer fails to return the car to the leasing company, again the leasing company will hold you responsible. Moreover, the dealer will most likely add all or part of those remaining payments back into the price of your new car.

3. "You will get a nice 3.4% rate on this lease, which is better than our loan rates."

Sounds great, right? Wrong! That 3.4% rate sounds attractive except that it is not an interest rate that they are giving you. The rate you are given is the lease's money factor which is more commonly written as .0034. To convert this figure to annual interest rate, multiply by 2400. Therefore, a .0034 money factor is equivalent to an 8.16% interest rate on an auto loan.

4. "We will accept your old leased vehicle as a trade-in and give you a good deal on a new lease."

Trading in a leased car is a bad idea. The reason is that many people will not have any equity in their old leased car to help them buy or lease a new car. Many problems can arise from this situation. At worst case, the dealer takes your old leased vehicle and returns it to the leasing company, who will send you a bill for early termination or buyout. Or, the dealership can put the car on their used car lot after buying the car from the leasing company and adding the buyout cost, less the trade-in credit, to the price of your new vehicle. If you have reached the end of your lease and have no equity in your leased vehicle, it is better to return the car to the leasing company.

5. "Leasing is better than buying because you can swap cars anytime you want."

Yeah, right! Dealers are well aware that some people like to swap cars often and want the flexibility to get out of a lease when they choose to do so. Leasing allows people to do that. What the dealership hides from you is that leasing is designed in a way to make it hard and expensive to close the lease before the normal end date.

6. "Leasing is better than buying because the monthly payments are less for the same car."

This fact is true that lease payments are less than monthly purchase payments. This allows dealerships to suggest that leasing is a better deal. However, the reality is that dealerships many times stretch out the lease term to 60 months or more to make the payments even lower. If you drive 15,000 miles or more per year, then leasing is definitely not for you. The dealer may "forget" to explain that to you. A 60 month lease on a vehicle that only has a 36 month warranty makes you prone to expensive car repair costs for a vehicle that you do not own.

7. "Leasing does not show up as a debt liability on your credit report because it is similar to renting."

Nothing could be farther from the truth. Leasing is not like renting. Leasing does show up on your credit report as a debt you must pay just like a loan. If you are late making payments, your credit record is blemished, just like with a loan. If you are concerned about your load of debt, then do not consider leasing a car.

8. "The best way to get a new car is to lease first and then buy the car at the end of the lease."

Not true. Although leasing offers lower monthly payments, purchasing the car at the end of the lease adds more to the cost and makes the total cost of the lease-purchase option scenario greater than if you had bought the car at the beginning. Do not allow an underhanded car salesman convince you that the extra cost is non-existent.

9. "Factory rebates and price discounts do not apply to leasing."

Many car dealerships take advantage of their customers who are not cognizant of the leasing process. Some will tell you that leasing is always based on a "sticker price." This is a bunch of B.S. Leasing is always based on negotiated, rebated, or discounted price. Do not allow a dealership swindle you this way.

10. "All our leased cars must have extended warranties, rust proofing, paint protection, maintenance contracts, and window etching."

This is another deceptive tactic used by dealerships. The reality is that these are just options and not requirements, but the dealer is hoping that you do not know that. Leasing companies do not require you to have these options that the dealer may suggest. Dealerships are only interested in padding their profits as best as they can.