Why You Should Lease a Car
Why should you lease a car? Watch the video (in Russian) and read the interview transcript below to find out.
Yulisa Famina: Hello, dear viewers. Today I would like to introduce to you one awesome man who can help you sell cars, well, buy cars – not sell them, you can sell a car later at some point. And the most important thing I would like to point out is that this office provides the best prices in LA, and I am a living proof, and today I want to introduce Zorik. Zorik, hi, tell us please why people should choose to lease a car, because, you know, in people’s minds – since USSR times – if something doesn’t belong to you, it is a bad thing: somebody is trying to deceive you, and I received a lot of comments, after I announced that I had leased a car, stating that I made a huge mistake, that it (the car) doesn’t belong to me. Can you please explain to viewers why you should choose leasing a car and what the advantages are?
Zorik Grigoryan: Hello. Well, first of all, the advantage is: you have 3 years to think whether you need a car in the future or not. From the financial standpoint, you would spend the same amount of money during those 3 years, if you bought a car. But in 3 years it is harder to sell a used car, so you need to choose whether you want to sell it or lease it out and buy a new car. Secondly, a newly leased car provides you with a 24-hour roadside assistance
Yulisa Famina: Roadside service is when something happens to you, you will get help for free.
Zorik Grigoryan: If something happens to you, a towing company will come to pick you up for free, and to drop you off at any establishment such as, let’s say, a dealership; if you run out of gas, they will bring gas and fill it up for you, or if you got a flat tire, and some women don’t know how to change tires, they will come and help you change the tire.
Yulisa Famina: So it is separate from car insurance, right? This service doesn’t have to be a part of your car insurance?
Zorik Grigoryan: It comes with a leasing agreement. What’s great about it is that you never have to worry that you will be left stranded without a car. So if the car has to stay at the dealership for repairs till next day, they will provide you with another car while yours is in the repair shop, this way you won’t be left carless. So it is no brainer. You make smaller car payments, twice less for a down payment or sometimes even no down payment, and drive your car worry-free.
Yulisa Famina: Down payment is (for a lot of viewers who are not familiar with this definition – because we have been mixing languages and we understand each other) when you lease a car, you have to pay a deposit, I believe that’s what you call it; you know what, guys, I have asked many people and everyone pays a very high deposit ; Zorik, when I tell people how much I paid here, they say ‘Oh gosh, it’s impossible, it is a scam’, and I say ‘but look, I have been driving a car for 2 years’. Here in this office they offer the lowest deposit, and Zorik says that sometimes you don’t even need to pay a deposit.
Zorik Grigoryan: Yes, we are very open, transparent, and we try to maintain long-term relationship with our clients. Deposit is something that depends on your credit history: if it’s good, you don’t even need to pay a deposit. Let’s say they give a loan amount…
Yulisa Famina: One moment, let me interpret that for our viewers…
Zorik Grigoryan: Oh so it is news for you too?
Yulisa Famina: No, I just need to interpret that. Credit – I am explaining why credit is so important: when you come here with a perfect credit history, you don’t even need to make a down payment, or deposit. If your credit history is good, then the monthly payments that you make every month are pretty low, right?
Zorik Grigoryan: Yes, correct. There is a loan amount (issued to you), let’s say a car loan is 11,000 but they only gave you 10,000, then you must give 1,000 for a down payment to get the car. If car costs 9,000 and they loan is 10,000, then it is your choice whether to make a down payment or not. If you make a down payment, you pay less monthly, if not – you pay more. This is how it works, but it is not a bribe that is given to someone to obtain a car. We disclose all the information to avoid any miscommunication – we are very transparent.
Yulisa Famina: So what should a person that has just come to the US do, if he has no credit history yet but he has documents? Important: you have to have social security number and…?
Zorik Grigoryan: Social security number and work authorization.
Yulisa Famina: Social security… So green card is not required?
Zorik Grigoryan: No, it is not.
Yulisa Famina: You are issued Social security number and work authorization when your case was accepted by USCIS and in 150 days you receive these 2 documents. So you have to wait a little bit and come to Zorik for a new car. Am I right?
Zorik Grigoryan: Yes, we have a special program for people that have just come to the US and don’t know that there is a possibility of leasing a car. We can provide a car to those who don’t have a credit history or a credit score yet or at all. Let’s say they got their Social security number and work authorization card just yesterday. So we have a special program which can provide you with a car, not expensive car of course, no more than 30,000 dollars.
Yulisa Famina: What cars cost no more than 30,000 dollars, for instance?
Zorik Grigoryan: Honda Accord, Civic, CRV – no more than 30,000 dollars. Brand new with 0 miles – for lease. What are the benefits? We need to mention that in America a credit history is like your uncle or a close relative: when life gets too difficult and you need to borrow money, there is a credit history, credit limits, credit cards, so you don’t have to go and ask someone for money and promise to return it at a certain time, and if you don’t return it, you damage your relationship with that person… So all that is very serious here. So what is good about leasing for people without a credit history or credit score – you may get a credit history within a year (if you follow my instructions, of course) and credit limits for 15,000-20,000 dollars.
Yulisa Famina: Perfect. So it can be done pretty fast?
Zorik Grigoryan: It is great and it helps in the future. You won’t have problems with loans: to buy a house or to buy a car.
Yulisa Famina: Are credit history with the car and a credit history in the bank related?
Zorik Grigoryan: Definitely.
Yulisa Famina: Because I remember when I came to you to buy a car you told me that even though I have a good credit history with banks, the car will cost me a little more. I am paying more right now because it is my first leased car.
Zorik Grigoryan: In this case yes, I meant they are related on a bigger scale. If we get into more details: there are 3 credit agencies in the US: Equifax, Transunion and Experian. And there are 3 ways to run your credit: for credit cards, for mortgage, and for car (mortgage is when you buy a house).
Yulisa Famina: So 3 different bureaus?
Zorik Grigoryan: 3 different bureaus and 3 ways to pull up your credit history. So auto FICA score (when you apply for a car loan) will show you a different score comparing to scores for credit card or a house. So, there is a difference.
Yulisa Famina: Tell us please: when you drive a car and you put mileage on a car, what’s the limitation? Because before, I didn’t know that you can drive your car for only a certain amount of miles. What’s the limit?
Zorik Grigoryan: Everyone says you can have 10,000 or 12,000 miles, you can choose the amount before you sign the leasing agreement. Up to 20,000 miles per year. But that doesn’t mean that you have to drive 12,000 miles per year if your limit is 12,000. You can drive 5,000 miles in the first year, and 20,000 miles in the second year and the rest in the third year.
Yulisa Famina: the rest in the third year…
Zorik Grigoryan: And then you can extend your lease. For 6 months or 1 year…
Yulisa Famina: What for?
Zorik Grigoryan: If you went way over the mileage limit, you will have time to even it out – to stabilize the mileage.
Yulisa Famina: I see
Zorik Grigoryan: It’s better if you calculate your mileage: mileage to work, daily activities, to the store – and add 15 miles to it… multiply it by 31 days and then by 12 months. This way you will have a better picture of how much mileage you will be putting in.
Yulisa Famina: So if I want more mileage on my car, I make bigger leasing payments.
Zorik Grigoryan: The difference is not significant: 12-13 dollars more.
Yulisa Famina: Oh, ok then. It is not significant at all
Zorik Grigoryan: No. not at all.
Yulisa Famina: It is important to know, because I heard many stories that a person for example has to go to San Francisco and he rents a car to avoid driving his own car. I never understood that: why do you need to do that, if you can go in your own car. What’s the point? I never understood that: but it is about mileage – they want to keep it low but they spend money on car rental, and at the end of the day, I think, it’s all the same.
Zorik Grigoryan: Yes, it costs the same, that’s why you have to make some calculations before, take a pen and a piece of paper and do the math, and then you can make a decision.
Yulisa Famina: Yes, numbers are important. I was very resistant to leasing a car at first with my “it’s not mine” mentality. Why is it not mine and they will take it away from me later? So I would buy car cash and drive it. And one day my husband and I sat down and did some math, and we concluded that it was all the same, because you lose money when you sell your car, and nowadays it has become harder to sell the car here because of the competition with leased cars, and they are leased at such low prices. My friend who also deals with cars just told me that they had some promotion: leasing a car for 90 dollars a month, FIAT or something like that…
Zorik Grigoryan: It was Chevy
Yulisa Famina: Ok Chevy, for 90 dollars a month… It is almost free. So the competition is very tough. Let’s say I bought a car but how will I sell it? I will lose so much… But here I am driving Honda for 2 years and honestly, I cannot wait until the third year is over, I am tired of it.
Zorik Grigoryan: Yes, this is how young generation thinks. Our clientele are those who buy cars cash for work or older, retired people: they get the car and drive it for next 10 years. They have slightly different priorities. For young people, 2-3 years is more than enough.
Yulisa Famina: more than enough… it is like wearing the same dress for 2-3 years.
Zorik Grigoryan: Wow, that’s serious.
Yulisa Famina: One Armenian guy told me, when I was driving in Uber (long before I got my car) and we were arguing about leasing cars. He was trying to convince me into leasing a car and I was telling him “No, no way, it doesn’t belong to me”. He said “If you wore the same dress for 2-3 years, wouldn’t you be sick and tired of it? The same with cars”. I remember that comment, and it is true, I am really tired of this car now. I want a new car smell, to upgrade a car.
Zorik Grigoryan: Yes, when you buy a car, it has a lot of nuances you have to be aware of, especially if you buy it with a bank loan.
Yulisa Famina: Buying it with a bank loan is worse that leasing it, right?
Zorik Grigoryan: Well, it comes with more risks, I would say. Before you attempt to sell your car, this car might have already been in an accident; car loses its value rapidly and if it has been in an accident, it depreciates even more. Then you do your calculations, and you realize that you lose out; if, God forbid, your loan was for 5 years but in 4 years you decided that you wanted to sell it, you will lose right then and there. There are no chances of gaining any profit there. It is simple mathematics. This happens a lot with people from former USSR countries: they’d rather listen to other people’s opinion than do their own math.
Yulisa Famina: Yes, yes, please, dear viewers, it’s very important: those who don’t know or not familiar with such things, come to Zorik’s office, I will leave the address, you will sit down with him – they have great service – they will explain everything and show you the numbers, and make calculations. I am convinced that you will be very satisfied because everyone who leased their cars here after me, including my friends, is so happy. It is a new car and it smells great, you feel great. And it is the same amount of money that you would lose by driving this car for 3-4 years: you will have to sell it and you will be losing money anyways. Or you will waste money on car repairs later. I don’t even have that headache with repairs: I change oil and that is all I do.
Zorik Grigoryan: Especially for ladies – they shouldn’t be doing anything but shopping.
Yulisa Famina: That’s true. So, guys, please contact this office, I will definitely leave their contact information, and I am sure you will be satisfied.
Zorik Grigoryan: I would like to add that apart from leasing out cars, we also provide car insurance.
Yulisa Famina: that’s true.
Zorik Grigoryan: About 99% of people that get cars at our company obtain their car insurance here as well. It is cheaper than in other places…
Yulisa Famina: That is correct, I only pay 78$ a month for 2 people. It is very cheap.
Zorik Grigoryan: Yes, I wanted to point it out because it is very convenient and you get great experience buying a car with us.
Yulisa Famina: I approve and I attest to that. The best prices. Dear viewers, please feel free to contact this office. Thank you, Zorik. Bye!
Zorik Grigoryan: Thanks, goodbye!