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Although leasing might sound extremely good upfront, it's important for consumers who want to take advantage of leasing to understand the actual cost of the arrangement versus the residual value of the transaction. As most people know, the minute you drive a car off the dealer's lot, the vehicle will depreciate in value.When you opt to lease, you are choosing to payfor the difference between the value of the brand new vehicle versus the amount the dealer predicts it will be worth when you bring it back at the end of the lease; this is called the residual value. Thatresidual value typically ranges between 50 - 58% for a 36-month lease.

When you lease a vehicle, the company providing you with the arrangementbears the risk for the future value of the vehicle. It is impossible to predict that value three years out as many factors including gas prices, new technology, demand for the vehicle and the economy at large can affect the residual value of the vehicle. Those factors are taken into consideration and what actually determines theresidual value on a lease is the depreciation you will pay over the lease term.

So before you decide to lease your next vehicle, be sure to take a moment to calculate the actual cost and residual value of the automobile to determine if it is indeed the best choice for you.

Numerous auto manufacturers are making stronger attempts to encourage consumer spending by launching customer protection plans to lift the ailing auto industry. After Edmunds.com reported in February 2009 that there was a 38.9% decrease in sales from February 2008, its no surprise that manufacturers are working harder to lure in customers.

Will the Auto Makers' Plans Work?

A number of companies are willing to try their luck as they battle what seems to be an everlasting recession, along with customers seemingly relentless determination to save rather than invest in new vehicles.

Here are some companies launching new plans this year:

Hyundai's Protection Plan

In January 2009, Hyundai launched its Hyundai Assurance plan, which offers consumers buying or leasing new vehicles the ability to return them without penalty if they lose their income within the first year of purchase.

Ford's Protection Plan

In March 2009, Ford announced that it was launching a plan that would cover payments on any new Ford, Mercury, or Lincoln for up to 12 months if customers lose their income. Also, it would offer 0% financing on predetermined vehicle models through Ford Motor Credit.

GM's Protection Plan

Also in March 2009, General Motors announced the launch of its new GM Total Confidence vehicle value protection plan, which includes making up to nine $500 per month payments during the first 24 months of ownership if buyers lose their income as well as substantial cash-back incentives on trade-ins if buyers purchase 2008s or newer.

Since the plans are just getting started, its hard to say just yet whether they will successfully encourage consumers to purchase new vehicles. Despite manufacturer incentives and plans, the overall economy is continuing to weigh the sector down. Growing unemployment numbers and a falling housing market are the main reasons people aren't taking on new auto loans. So what do you think? Can plans like these lure you out of savings and onto a new car lot?

You need a new vehicle and are now in the process of deciding under what terms you are going to obtain it, whether through a lease or financing with an auto loan . If you are considering leasing a vehicle, there are some laws in place you need to be well aware of so you can get the most out of...

No one wants to end up in the position of having their vehicle repossessed . Aside from being extremely damaging to your credit history , it can be demoralizing. But since the provider of your auto loan is the official car owner until the vehicle is paid of in its entirety, it can happen if you...

If you are in the market to buy a new car, there are several options you can tap into to make the process easier. Aside from searching for auto loans online , consumers can locate auto loans either directly from a lender or from an auto loan broker.

Auto Loan Lenders

An auto lender is a bank or...

Two of America's biggest auto manufacturers have been told in no uncertain terms that they must make massive structural changes in the way they do business if they are to continue receiving government support . General Motors and Chrysler, which together employ millions of Americans, are both in...

Unfortunately your personal state of financial affairs have turned from bad to worse . You are still managing to keep the roof over your head and feed your family, but you are defaulting on your auto loan payments and are fearful of a car repossession . When a consumer chooses to finance the...

If you still owe money on your car, but are thinking about getting a new one, you may be wondering if you can conduct a trade-in; the answer is yes. However, conducting this type of transaction can be a bit confusing if youve never done it before. Lets look at how it works.

Trading in a Car with...

Sometimes financing a car can bring with it complications, and one of these can occur when you find that you owe more than your car is worth. While this is not terribly uncommon in the first year or two of owning your vehicle, after several years, if youre still in this situation, you may have a...

Consumers in need of a new automobile will benefit from perks included in the American Recovery and Reinvestment Act of 2009. The stimulus plan was officially signed into action on February 17, 2009 and is an opportunity of tax benefits for consumers in targeted industries that are most affected...