Should I Buy Or Lease?
Should you buy or lease? Even if this isn't your first car, comparing the benefits of a lease vs. buying can be confusing. We put together this handy guide to help Depere and Manitowoc drivers decide which path makes the most sense.
When you buy a car, you’ll be paying for the entire cost of a vehicle. Some people are able to pay upfront, while most will apply for a loan and then pay for the vehicle over time in a series of monthly payments, plus interest.
When you lease a car, it’s yours to use for a set amount of time as you pay a portion of the car’s value each month. In other words, you’re only paying for the time you use the car.
Owning a car can be a great investment. If you take care of it, you may drive it for many years or sell it for a good price when you opt for something new. When you compare a lease vs. buying, one of the biggest benefits of ownership is that there are no mileage limits, and no restrictions when it comes to accessories, add-ons, paint and bumper stickers, or aftermarket performance enhancers.
WHO OWNS IT
The car is yours and only yours. You might pay for it with cash, or make payments under a financing plan. If you’re financing the car, your lender will require you to meet certain obligations, such as monthly payments or a down payment. Keep in mind that if you don't keep up with your payments, the car can be repossessed.
Financing a car means the bank or lender will need an initial payment from you, which is usually calculated according to your credit score, among other factors. You may also choose to trade in your old vehicle, the value of which can be put towards your down payment.
While the value of a new car begins to depreciate as soon as you drive it off the lot, you may be able to sell your car for a fair price as long as you maintain it properly. It’s important to visit a factory-authorized service facility at regular maintenance intervals for this reason. However, even a car in bad shape may be sold for parts or scrap.
END OF PAYMENTS
You’ll have to pay a certain amount as stipulated in your contract, but once you’re done, that’s it. The institution you borrowed from will send you a Lien Release, which is proof that the vehicle belongs entirely to you and may not be repossessed for nonpayment. The vehicle is now yours.
Many Appleton-are drivers choose a lease vs. buying because of the lower cost. Leasing a car is much cheaper than buying it outright because you’re only paying a percentage of the total price. You won’t have to worry about fetching a good price or finding a buyer for it when you’re done, as the dealership will take it back from you at the end of your lease term. If you like to have the newest gadgets in your car, leasing may be your best bet, as you can regularly upgrade to drive the latest models. You may also be able to drive a fancier car than you could normally afford. Plus, your vehicle never becomes old enough to require major services like tires or breaks, which will save you even more money!
WHO OWNS IT
The institution through which you are leasing the car retains ownership. You’re essentially renting the vehicle. Your contract will state you are using the car for a set amount of time in exchange for a set amount of money.
A lease doesn’t typically require a down payment, but you will have to provide the first month’s payment along with a security deposit, acquisition fee, and any other applicable costs. You may be able to access a lower monthly fee by increasing your initial fee.
Because you don’t own the car, you release it to the leasing agency at the end of your term. However, pay close attention to any mileage restrictions or wear and tear guidelines—excessive use may cost you extra when you return your vehicle.
END OF PAYMENTS
At the end of the lease term, all you need to do is return the vehicle to the dealership. If you've changed your mind about lease vs. buying in the meantime, you may be able to purchase the vehicle ("buy out" the lease) or trade it in before the end of the term. If you think you might want to employ any of these options, ask your financing agent for details before the lease is signed.
BEST CARS TO LEASE
The amount you’ll pay for a lease is based on the amount of time you’ll have the car and the amount it will depreciate once you’ve driven it, so the cheapest leases are those for cars that will retain their value after the term of the lease is up. You can review lease ratings to see which cars will depreciate quickly and which cars will stay valuable.