Being able to lease a vehicle may come as a shock to you, but yes, it is a viable option.
It may be a tough call for you to make since purchasing a vehicle means it is your own, but you will sit with a higher monthly expense, whereas leasing will usually be at a lower monthly cost, but the vehicle is never truly yours.
The leasing bug has bitten many around you, and now you may be wondering what option will work best for your lifestyle. There is more to it than only a few signed papers and a car to drive around in.
If you lease a vehicle, you will be able to drive a car higher in price range than you can afford. This is why so many choose this option – but is it right for you?
Buying a Car:
Purchasing a car and owning it is pretty straightforward – First, you apply for a loan from a bank or lender. Once approved, you get your vehicle and will likely pay a hefty monthly instalment for a few years.
Your instalments will depend on your credit score, the lender you chose, and the current interest rate. However, when your payment period has ended, the car is yours to keep, or you can trade it in and go through the process again.
Leasing a Car:
Leasing a car has become mainstream in today’s day and age, especially with Coivd 19 and not driving around as much as you would in previous years.
People are now working from home 0 more than ever before, and purchasing a car might not seem worth it.
So when you are leasing, there will usually be a set fee, which will vary depending on the milage of the month, so the less you drive, the less you pay.
Of course, factors such as the car’s expected value when the lease ends and the extra finance charges also come into play, but these will all differ depending on where you are leasing.
But you should note, the car is never truly yours.
The Main Differences Between Leasing and Owning a Car:
Buying/Owning:
● Lower Monthly Payments
● You Will Return The Vehicle Once the Lease is Over
● Great Warranty Protection
Leasing:
● Higher Monthly Payments
● It is Your Car
● Warranty Repair Costs
The Main Advantages of Leasing a Vehicle:
When you weigh up the two options, you may find that leasing a vehicle seems more appealing to you. If this is an option you are considering, here are the main advantages of leasing:
- You will use this vehicle during its least troublesome years – the years where things are least likely to break!
- You are always driving the latest model, which means the manufacturer’s new car warranty covers it.
- You will be able to drive higher prices vehicles, which you wouldn’t have been able to afford otherwise.
- Your vehicle will have the latest, best safety functions.
- Depreciating value is not something you need to worry about since you won’t be selling the vehicle.
- Depending on where you lease, your business could have magnificent tax benefits.
The Main Disadvantages of Leasing a Vehicle:
Of course, to every upside, there is a downside. Here are the main disadvantages to leasing a vehicle:
- Leasing will inevitably cost you more than purchasing your own vehicle.
- If you never purchase a car, and you continue to lease, one after the other, you will be paying monthly for a car, forever.
- You can only drive a specified about of miles on your leased car. You will need to pay about 15 cents for every mile you go over when you go above that amount.
- You will need to keep the vehicle in excellent condition. If by any chance, something is damaged, it will need to be fixed on your account.
- You will be charged if you decide to terminate your lease early. This could leave you with thousands of dollars in debt.
- You will need to restore the car to the way it was in the showroom, so you cannot do any personal customizations, and if you do, you will have to remove and replace them.
- You still need to maintain the vehicle. This means you will still be responsible for the vehicles tiers, gas and oil changes, which can be costly if you lease a more expensive vehicle.
- There can be a significant amount you need to pay when you finally return the vehicle.
When is Buying the Better Option for Me?
Buying is the better option for you if you want to own your own vehicle and you want to save in the long run.
Car loans can range anything from 12-72 months. After that, you can drive your car for however long you want without any additional charges except maintenance and use.
If you enjoy customizing their vehicle, or it is something you want to do. Buying is definitely the better option since it will cost you the customization and removal then replacement of all items if you lease.
If you have a lot of mileage under your belt each month, leasing is not a good option for you. This will give you a hefty bill at the end of the month. Instead, if you purchase your own car, you can drive as much and far as you want.
Lastly, if you want to drive a vehicle for an extended period and do not mind driving an older model in a few years, purchasing a car is the right option.
It will save you a lot of money in the long run.
When is Leasing the Better Option for Me?
If you need to have a lower monthly instalment, leasing could be the option to go for. However, if you are purchasing a vehicle, the monthly instalments are much higher since you are paying for the whole vehicle over time. In contrast, with leasing, you are only paying for the period you use it.
If you want to drive the latest vehicle model, leasing could be the better, more affordable option for you.
Conclusion:
Leasing is the option for you if you want to keep your monthly instalments low, and it would work well for those who don’t drive a lot.
However, purchasing a vehicle saves you a lot of money in the long run, and if it is something you can afford, it is the better choice to go for. But, of course, this is if you are happy with driving the same vehicle for the foreseeable future.
