Leasing vs Buying: What is the Difference?
Leasing vs Buying: What is the Difference?
Car shopping can be extremely stressful, especially when you don’t know what you want, or how you want to pay for it. Some of the newer vehicles are extremely expensive, but you don’t want to pay for a vehicle that is going to break down right away. What should you do?
There are a few payment options for you to choose from. The main two that people tend to lean toward is leasing or buying outright. How do you know which option is best for you?
Leasing a Car
Car leasing means that you are paying to drive a new car. There are limitations on the number of miles you can drive during the leasing period, but there are plenty of benefits to leasing a vehicle.
Although you are paying for this vehicle, this agreement is not for you to own the vehicle in the end. Some places agree to allow you to buy the vehicle after the lease is up, but this is a select few places. Some places even offer lease deals, which help to make sure that you can afford the vehicle.
The payments may be lower than a normal financed vehicle, but the distinct difference is the title of ownership. You do not own the vehicle, you are renting it from the dealership. Once the lease is up, you can turn it in for a new vehicle, or you can continue to lease it.
Think of this option in comparison to renting an apartment. You make monthly payments on your vehicle so that you don’t get it repossessed and you can drive it around as much as you want, as long as it is within the limitations of the agreed-upon mileage.
Leasing has a lot of benefits. A lot of these benefits set it apart from buying and financing because it gives you advantages that help you to succeed with your car. There are plenty of benefits, but the top 3 that have been found are:
The average length of a lease is about 36 months or less. Up to 36 months, you are covered bumper to bumper through the manufacturer warranty. Because of this, you do not have to pay for major repair costs.
Most manufacturer warranty providers even offer free maintenance for the first couple of years. This is extremely beneficial, as it means you get to save your money to pay for the car and important other things, instead of worrying about paying for upkeep.
Driving the Latest Vehicles
Generally speaking, once your lease is up, you can opt to drive a newer vehicle. This means you are always driving the newest innovation in cars. You can test which safety features and technological advances you enjoy before you decide to purchase a car (if you ever want to, that is).
The leasing options that you have can help you to narrow down what kind of car you would want to buy in the future.
No Used Car Hassle
Smart leasing saves you a lot of time. Once you are done with your lease, all you have to do is return it to the leasing company that you got it from. No need to spend needless time selling an old vehicle that isn’t even guaranteed to be sold.
Buying a New Car
Buying a car is very self-explanatory, even though it can be one of the most difficult experiences. You have to deal with salesmen that work mostly on commissions. They want you to buy the car because they make more money.
This means they are willing to tell you anything in order to get you to buy a car through them. They may leave out information, say there is nothing wrong with it, or even knock some money off just to get what they want.
Go into the situation with a level head and idea of what you want and you might make it out with what you want. You have to pay full price for the vehicle, which can be extremely expensive upfront, but it means you don’t have to continue to pay it off for months or years to come.
When it comes to buying a car, the benefits may seem to outweigh that of Leasing, but there is a lot to think about when it comes to buying. One of them being, do you want to be tied down to one vehicle? Some of the main benefits include:
You don’t have to worry about bringing your vehicle back anywhere when your lease is up. This is your car to do anything that you want with it.
You can do what you would like with your car once it is paid off. You want a hot pink car instead of a black car, you have the option to do so. Although it is all on your dime, you have the freedom to choose what your car looks like once you own it.
You Own the Vehicle
This car is now yours. You have the title in your name, and it belongs to you and only you. For some people, having the car in their name completely is what they like more than anything else. Being able to say that they purchased the vehicle on their own is the highest satisfaction.
What is Best for You?
Everyone is different. Some people want the newest vehicles on the market and will do anything to always be updated. There are people who can’t afford to purchase a car, or aren’t at that point in their life where it is financially beneficial. In this case, leasing might be the best option for you.
Some people are able to spend the extra money in order to have a reliable vehicle. There are people out there who don’t feel that leasing is beneficial and that you are just renting a car. For those who have these kinds of mindsets, it is recommended to just purchase the vehicle.
It all depends on which is best for you and what you think you should do. Buying or leasing a car is a large financial decision, and some people dread having these kinds of events happen. Knowing that there are options out there for everyone is one of the best pieces of information that you can have.
Blog By Brooke Lazar