As recently as ten years ago, most automobile consumers had never heard of leasing, much less done it. Now, approximately a third of all new cars are leased, and the numbers are increasing every year. Just look at the car and truck leasing ads in your local newspaper.

Two key factors have caused the big shift to leasing. First, the cost of new cars has rapidly spiraled upwards in the last few years, often putting prices out of reach of average buyers. Second, tax law changes in the late 1980's eliminated interest deductions on car loans, further increasing the cost of ownership. The net effect was that people were eager to find ways to make car purchases more affordable.

Auto manufacturers and finance companies came to the rescue with consumer leasing programs. These new programs were simply slightly modified versions of business leases that had been around for years.

In a nutshell, leasing has become popular because it offers people a way to drive the vehicles they want — often better vehicles than they could buy — for less money and less hassle.

As attractive as it may be, leasing may not fit everybody's needs and lifestyle. Furthermore, leases are somewhat more complicated than new-car purchase loans and require greater care and preparation in order to get a good fair deal.