A lot of confusion surrounds car leasing and renting. Hopefully by the end of this article, you will have a much better understanding on the difference of these concepts.

First off, renting lets people use a car for a short period. The rates are determined by a rental company and can range from daily to weekly charges. On the other hand, leasing is a financing option. This lets people drive and pay for a car that they want much like a loan.

Renting is relatively easier than leasing. Credit ratings, income and debt are all examined before being able to lease a vehicle. This often reflects on your credit report. Renting meanwhile is not much fickle when it comes to customers.

A rented car is easier to return and replace than a leased one. Certain terms often prevents a lessee to return the vehicle especially without penalties. A lease contract is also long-term and more difficult to opt out than a rent.

Car rental companies do not have much variety in the cars that they offer than car leasing companies. Your choice of rented cars is much more limited.

Rented ones are usually covered with basic insurance but you have to agree to pay for fuel and not damage the vehicle. Warranties can be included in a leasing agreement which covers for maintenance but not gas. Any damage to the vehicle must be paid for by the lessee.

As you may know understand, car leasing and car renting are very much different from each other.

There is a lot of misinformation about the general state of the auto warranty business out there. The internet is full of articles that offer all sorts of information. Some of it is correct, some of it is blatant lying, and some of it is uninformed rumor spreading. But there is one big myth out there that needs to be dispelled, and that concerns the extended warranty that you will be offered when you purchase a new car from a dealership.

Of course, we all know that the world of auto sales is a highly competitive one. We won’t insult the hard-working members of that profession by lumping them all together, but sadly, there are some very shady characters out there that ruin the reputations of the rest, and give us our impressions and stereotypes about sleazy car sales people.

It is also no secret that car sales people make the bulk of their commissions on financing. This can mean big money to a sales person, so they will push the options that will be on the brink of what is most useful to the customer, to the furthest edge of what makes them the largest commission.

But where some sales people cross the line, in regards to warranties, is when they propagate the myth that an extended warranty is something that can only be purchased from the dealer, and only at the time you make the initial purchase. This is completely false.

While you can certainly make that purchase, it may not be the wisest. The costs, when bundled into your financing package for the new car, may be considerably more than if you were to shop for the extended warranty independently. A dealer usually works with only one finance company and one warranty provider, so there is no comparison shopping you can do here.

The other downside to buying an extended warranty at the time of purchase is that your extended warranty may kick in right away – so you will be double covered. If your manufacturer offers a three year warranty, and you purchase an additional five year extended warranty, you will be covered for a total of five years, not eight.

So be aware when you go in to make that purchase of a new or used car from a dealership. There is a convenience factor to purchasing the auto warranty at that time, and yes, the costs will be rolled into your financing, so you won’t have to make a large payment. But it could end up costing you, further down the road.