A sign and drive lease lets you drive your new lease home without paying certain initial costs, like a down payment, upon signing. These costs are rolled into higher monthly rates instead.<\/p>\n\n\n\n
If you\u2019re itching to lease a new car but don\u2019t have the funds to pay hefty upfront costs, a sign and drive lease can spare you some penny-pinching and get your lease going faster. But can you really leave your checkbook at home?<\/p>\n\n\n\n
To help you navigate these questions, Jerry<\/a>, the super app saving millions of drivers money on car insurance<\/a>, has put together a guide. From pros and cons to eligibility requirements, here are the ins and outs of sign and drive leases.<\/p>\n\n\n\n You may have seen sign and drive lease specials advertised in dealership commercials, but what do these offers actually mean?<\/p>\n\n\n\n Simply put, sign and drive leases are exactly as they sound: you sign the paperwork for a car lease, then drive away with the car. There is typically no initial exchange of money. Instead, the costs you would normally pay before driving off the lot are calculated into your monthly lease payments.<\/p>\n\n\n\n Because sign and drive leases are riskier to dealerships, however, you need to have an excellent credit score to be eligible for one. Often this can mean you\u2019ll need a credit score over 720, but it will depend on the dealership and the finance companies they work with.<\/p>\n\n\n\n A sign and drive lease and a no money down lease both forego a down payment on closing day. But there is a distinction between the two.<\/p>\n\n\n\n Namely, most sign and drive leases roll all of your upfront costs into your monthly payments, while no money down leases may still come with additional upfront costs aside from the down payment. These due-at-signing costs usually include dealership and acquisition fees, a security deposit, your first month\u2019s payment, and taxes.<\/p>\n\n\n\n That said, many dealerships consider sign and drive leases a type of no money down lease because of their similar financing features. In fact, certain dealers sometimes interchange the two terms. It\u2019s therefore crucial that you verify whether your sign and drive lease requires any payment up front before you arrive penniless to close the deal.<\/p>\n\n\n\n If you\u2019re worried that driving your Volkswagen crossover off the lot without paying a cent of your lease seems too good to be true, you\u2019re a responsible buyer. There are definitely benefits and drawbacks to a sign and drive lease deal.<\/p>\n\n\n\n Here are some pros and cons to pay attention to.<\/p>\n\n\n\n Arguably the greatest benefit of a sign and drive lease is that you don\u2019t have to spend thousands of dollars on a down payment up front. While this increases accessibility for those who can\u2019t manage significant initial costs, it can also save you money in the event of an accident.<\/p>\n\n\n\n Let\u2019s say another driver is texting and driving and hits your brand new Honda Fit hatchback months after you started the lease. Because your car is totaled, your insurer pays out the claim to the leasing company and your lease contract ends.<\/p>\n\n\n\n Having GAP insurance can help cover the remaining balance you owe to the leasing company after a total loss. However, it can\u2019t cover the down payment you already made. In this case, a sign and drive lease deal would prevent that financial loss because you haven\u2019t paid any lump sums up front.<\/p>\n\n\n\n You don\u2019t have to save up months of paychecks to lease a car through a sign and drive lease offer. All you have to do is show up, sign the paperwork, and then drive off in that shiny new Dodge Durango or GMC Acadia.<\/p>\n\n\n\n Though those hefty initial costs are still rolled into monthly payments, paying out the sum over time rather than all at once enables some drivers to access new leases sooner.<\/p>\n\n\n\n The costs of your down payment, security deposit, taxes, and fees don\u2019t just disappear in a sign and drive lease. Instead, they get absorbed into your monthly payments, which means that these payments will be higher.<\/p>\n\n\n\n So if you would rather manage lower monthly payments on that Ram 1500 you\u2019ve had your eye on, you\u2019ll be better off opting to pay more up front.<\/p>\n\n\n\n You won\u2019t be able to qualify for a sign and drive lease deal if your credit score is low. Generally, this offer is extended only to \u201cthe most qualified buyers,\u201d which tends to mean drivers with a credit score of 720 or higher.<\/p>\n\n\n\n Dealerships aren\u2019t always straightforward about this, however. In fact, some no-down deal ads leave this crucial caveat out so that potential buyers (regardless of their eligibility) have an incentive to come to the dealership and pick out a new vehicle. In these cases, sign and drive lease specials serve as marketing ploys, enticing drivers in but ultimately failing to benefit a good number of those interested.<\/p>\n\n\n\n Though sign and drive leases are a tempting way to get a new vehicle into your garage quickly, it\u2019s important to do your research first. Here are a few tips to ensure you\u2019re getting the best lease deal possible:<\/p>\n\n\n\n Leasing a vehicle can be a great way to try out newer models. As an added perk, most leases also include bumper-to-bumper warranty coverage throughout your term.<\/p>\n\n\n\n To amplify this protection, GAP insurance coverage is usually included, as well. But for the full coverage you need to protect your brand new investment, you\u2019ll still have to buy a quality car insurance <\/a>plan. Jerry<\/a> can help!<\/p>\n\n\n\n A car insurance savings super app, Jerry instantly finds you the most affordable policies available from over 55 top insurers. Unlike negotiating lease deals, Jerry can do all the heavy lifting for you, too\u2014from transitional paperwork and calls to shopping for lower quotes (even after your policy has started).<\/p>\n\n\n\n The best part? The average Jerry user saves over $800 a year on car insurance, so it\u2019s definitely worth the free look!<\/p>\n\n\n\nWhat is a sign & drive lease?<\/h2>\n\n\n\n
Sign & drive lease vs no money down lease<\/h3>\n\n\n\n
Pros and cons of a sign & drive lease<\/h2>\n\n\n\n
PRO You don\u2019t have to make a down payment<\/h3>\n\n\n\n
PRO You can drive your new car off the lot immediately<\/h3>\n\n\n\n
CON Your monthly payments will be higher<\/h3>\n\n\n\n
CON You need an excellent credit score to qualify<\/h3>\n\n\n\n
How to make sure you get the best lease deal<\/h2>\n\n\n\n
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How to find cheap car insurance for your leased vehicle<\/h2>\n\n\n\n