When you are in the market to purchase a new vehicle, it can be tricky to figure out whether you are wanting to buy a new car or lease one. There are many pros and cons to both choices. However, there are a variety of reasons why leasing a car is the best option for many people. A lot of people in the market for a new car might shy away from a lease because the terms and conditions may seem a bit confusing. However, they are pretty easy to understand once you take the time to learn what they mean. While leasing a car is not for everyone, below are some of the reasons why you should lease a new car instead of buying one.
No Or Low Down Payment
Oftentimes, when you go to sign for a new car lease, you won’t be required to come up with a down payment if you have good enough credit to qualify. Even if you do need to put down a down payment for your lease, the amount required will be much smaller than it would be if you were trying to buy the same type of vehicle. If you aren’t required to make a down payment, the dealership may still require you to pay the first month’s lease payment as well as the fees for the tag and registration.
Low Monthly Payments
Leasing a new vehicle compared to buying one will result in much lower monthly payments. Your payments are calculated at a portion of the vehicle’s value for the length of the lease term. Your leased car payments can typically be almost half of what your payments would be if you were buying the same vehicle. With a lease contract, you also won’t be required to pay extra each month towards the investment in the equity of the vehicle.
New Vehicles More Often
When you buy a car in cash or through financing, you will typically be stuck with that car for many years. If you do decide to trade your bought car in for a new one, you will have to worry about getting a good deal on it. When you lease a vehicle, you will get a new vehicle to drive every two or three years. You won’t have to be worried about getting stuck with the same vehicle for years on end and miss out on all the latest gadgets and technology that the newer vehicles have.
Easy Maintenance Routine
When you buy a car, you will be in charge of any maintenance and repairs outside of the warranty period. Leased car terms usually fall within the manufacturer’s warranty period. Your lease will end on most vehicles before any warranty expires. This means that when you lease vehicles, you will always have warranty to cover maintenance and mechanical issues.
When you sign a car lease, you won’t have to pay taxes on the full value of the car. You will only be required to pay a portion of the car’s value during the full lease term. The tax amount will be divided equally between all the months of your lease. When you buy a new vehicle, you will be required to pay taxes for the full amount of the car. This amount can add up.
No Fuss Selling Your Used Car
If you buy a car and end up wanting to trade it in for a newer car, it can be a long, tedious process trying to get a good deal on it. When you lease a car, all you have to do is turn in the car and sign a new lease on another vehicle. As long as you followed the lease rules over the course of your term, you will have no issues trading it in on a new leased vehicle. If you love the vehicle you were leasing, you will also be given the opportunity to purchase the car if you choose to once your lease ends.
Less Out-Of-Pocket Spending
Many people don’t like the idea of having to come up with so much money in order to purchase a new car. It can leave someone with low funds for other things they need to pay for in their financial lives. The best thing about leasing a new vehicle is that there is not much out-of-pocket costs up front, especially if you aren’t required to put a down payment on the lease. With a lease, you don’t have to worry about going broke just to get a new vehicle.
GAP Coverage Included
When you lease a new vehicle instead of buying, you will automatically get GAP coverage. This coverage can help alleviate the costs of recovering from a theft or totaling of your vehicle after what your insurance pays for. If you buy a new vehicle, you will be required to spend more money out-of-pocket to purchase GAP coverage separately.