Benefits of Leasing
This is a question that lingers in most people’s minds. For some people, it makes sense to lease rather than own a car. It especially makes sense for someone that likes to drive a new car for the reliability and newer technology that it offers. Leasing can be more cost-effective in the short run. Your monthly payments are generally lower, and you can often avoid a down payment. The consumer has the option of lower costs in the short term enabling a possible switch to a nicer car. Leasing results in other advantages over ownership: It enables you to trade up for a new car as soon as the lease expires. You also don’t need to worry about selling or trading in a car when you want to get rid of it. Another nice feature is that the warranty will probably cover the length of the lease; thus, you don’t have to worry about the cost of repairs. Wait! It sounds like the lease is the “no-brainer” way to go, right?
Purchasing May be the Better Option
Not so fast! For many, it still makes sense to buy instead of lease. Leases carry mileage restrictions with expensive charges for excess miles traveled. For someone that drives a lot, a lease probably doesn’t make sense. If you own the car, there is no restriction on mileage. In addition, someone with less-than-stellar credit is less likely to qualify for a lease. Finally, there is also the advantage of paying off the car and then eliminating that monthly expense.
Bottom Line
Bottom Line: The better option depends on the situation. There are pros and cons of each. A consumer should carefully think about how a car will be used. The lease is a nice option, but for a high-mileage consumer that wants long-term savings, the purchase may still make more sense. Talk to one of our member service representatives for help in making the right choice.
You can also check out our Auto Center for other information.