Considering the idea of either buying or leasing a car is a very common dilemma – which is much better? Every one of us has ever considered leasing as a great option. The answer to the question of which is better, it depends. It is not simple to say that one is better than the other because the answer depends on every individual’s specific situation. When making a lease or buying a car you must not only look at its financial comparisons but also to your own personal priorities. We find out that making buy-or-lease decision is not quite cut and dry. There are so many things we need to consider. First is, we must understand that leasing and buying is two different scenarios, not just two different version of the same thing.

When we say we buy, we pay the entire cost of the vehicle. Regardless how many miles you’ve used it. We normally make a so called down payment, pay an interest rate determined by Loan Company and pay sales taxes in cash or roll them into loan. We make the first payment a month after we’ve sign the contract. And later we decide if either we sell or trade the car for its depreciated resale value. The greatest benefit we could get from buying a car is we may actually own it in one day. Included to this is we’ll have one day free of car payments. The car is ours to sell at any time and we’re not locked into any fixed ownership period type.

When we lease, we only pay a portion of the car’s original cost, which is the part that you use up during the time you’re using or driving it. We have the option of not making a down payment but we pay the tax only on out monthly payments, we pay a financial rate, which is similar to the interest in a loan. When leasing we are also required to pay for some fees and even possible a security deposit that we don’t pay when we buy. We make the payment at the time we sign our contract – for the ahead. At lease-end we may either purchase the car for its depreciated resale value or return the vehicle. Perhaps leasing a car’s greatest benefit is the lower-out-pocket costs when we acquire and maintain the car. Leasing requires no or little down payment and there is no upfront sales tax payment. Its monthly payments are lower, and we get the bliss of owning a new car every few years.

There are many different factors to mull over when deciding whether to lease a car or buy a new car. The processes of each are very different, with car leasing potentially being the more confusing of the two due to its vast terminology. Not sure if you should lease or buy? It’s is up to our decision if what fits us the most.

Bookmark: