Buying vs Leasing a New Car

When shopping for a new ride, you must decide whether you would like to buy it or lease it. There are clear advantages and disadvantages to both options. Here are some important facts to keep in mind.

What is a Car Lease?

A car lease is similar to renting a vehicle. You are essentially paying to use the vehicle for a certain amount of time, which is typically 36 months. After your lease expires, the vehicle must be returned to the dealership.

Benefits of Leasing

Leasing a vehicle rewards car shoppers with several benefits. Many customers are certainly intrigued by the lower monthly payments. Furthermore, you can lease some vehicles without even paying a down payment. Because leased vehicles come with a bumper-to-bumper warranty, they are often less expensive to own. In the event that the vehicle needs a repair, the dealership will cover the cost. If you love the thought of upgrading to a new model every few years, leasing is definitely a good choice.

Drawbacks of Leasing

Unfortunately, there are some key disadvantages to leasing a vehicle. Leased vehicles have mileage restrictions. In most instances, you are restricted from driving the vehicle more than 12,000 miles a year. This could be an issue for the drivers who tend to do a great deal of traveling. If you happen to exceed the mileage limit, you will be required to pay an overage fee. When driving a leased automobile, it is especially important that you keep it properly maintained. You will be charged a penalty if there is an excessive amount of wear and tear. Dented body panels and damaged upholstery will certainly cause you to fork out extra money. Furthermore, you are not allowed to make any customization to the vehicle.

Benefits of Ownership

Owning a vehicle is the ideal choice for the drivers who want complete freedom. Ownership means that you have the ability to customize your vehicle. Whether you want to install aftermarket wheels or make modifications to the engine, you have the freedom to do so. After your car loan has been paid off, you no longer have to worry about making any monthly payments. Yet another advantage of ownership is the lack of a mileage restriction.

Drawbacks of Ownership

Often times, buying a vehicle requires a larger down payment. The monthly payments are usually higher as well. You also have to deal with the vehicle’s depreciated value. Although all vehicles do not depreciate in value at the same rate, it will still be worth far less money than when new. Additionally, you must cover the cost of any repairs.