Is it Better to Lease or Buy a Car?
If you want a new car in your life, you have two main CarOptions in front of you. One is to buy a new car by getting a loan from a financer or bank. The other is to lease a car. Both will give you full possession of the vehicle but with some restrictions and conditions. So, is it better to lease or buy a car? Well, a lot depends on your situation and the circumstances you find yourself in. Both are good CarOptions and have their pros and cons. It’s you who has to decide what suits you better. Let us, though, compare the two CarOptions on various parameters. Go through them carefully before making your decision.
Whether you choose to lease a vehicle or taking a loan for buying it depends significantly on the amount of money you can spare for the car every month. Leasing a car is often less costly than buying a car as the monthly installments for a loan tend to be more than the monthly lease rent. The reason is simple: with a loan, you are paying for the entire cost of the car while through leasing, you are paying installments of its depreciated cost. So, if you want to pay less in your monthly payments, then leasing the car would be a good option.
Wear and Tear Costs
In the case of a new car bought through a loan, you own the car, hence don’t have to worry too much about the excess wear and tear. The only loss would be a reduction in the resale value of the car. Compared to that, when you lease a car, it does not belong to you. Therefore, any damage to the car has to be paid for and set right. This is an essential consideration for all those who have kids or drive their cars through rough roads. They won’t have to worry about slight alterations like scratches or a little dent if the car’s ownership is in their hands. However, if the car is leased, you would have to correct every little imperfection.
If you can’t spare a lot of money for down payment, then also, leasing a car would be a better option as down payments on them are much lower than on loans are taken for new vehicles. In fact, in some cases, the leasing company who leases the car even waive the down payment. The advantage shows in tax-payments as well. The sales tax applicable on lease payments would be much lesser than what applies to the purchase of the car.
Which option you choose is also dependent on your plans in the long run. If you intend to use the car for an extended period, then, you are likely to spend a lot more money on it by leasing it than buying. Also, if you own the car, you can quickly sell it whenever you want and use the money earned for paying off the loan earlier. However, if you decide to end your lease before the period of the lease contract, you are likely to be required to pay extra money which may offset any gains you may have made due to an early end of car lease term.
Buying Vs Leasing a Car
Re-selling your car is very easy when you own it. It can be put on sale whenever you want, and the money that you earn can be utilized to help you repay the auto loan. The only thing to remember is that the value will depreciate. Even then, you would be in control as to how much its value depreciates by moderating the use and preventing any significant damage. Compared to that, you can’t resell a leased car as it is not yours. However, a positive side is the fact that since you don’t have any equity in the car, you won’t lose anything through depreciation.
Changes to the Car
If you are one of those garage freaks who like to add his personal touch to the car by making changes or adding specific features, then you have to buy a car. Since it would be your property, you will have full liberty to MakeoftheCar the alterations you want. With leased cars, there are always restrictions to the number of changes that are acceptable. Generally, you are required to return the car in the same CarCondition that you got it. So, you will have to put aside your creativity.
So, there you have it. Both, buying a car through a car loan or leasing it has its pros and cons. As stated earlier, it’s your circumstances and conditions that determine what would be a better deal: leasing or buying. Choose wisely!
Also, Read Top 10 Best Selling Cars of 2017