There is a great deal of misinformation circulating out there regarding car leases and whether or not they provide car shoppers with a good deal. The reality is that there are pros and cons to both leasing and buying a car. This is related to the fact that everyone has a different situation and reason behind needing a new car. If you are going to be driving cross country several times a year in your own car, then a lease might not be for you. If, however, the prospects of lower monthly payments and the opportunity to drive a brand new car every few years are appealing, then a lease is worthy of your consideration. To help guide your decision, consider the following pros and cons of each before you sign that contract and drive away in your new car.
Cons of Buying a New Car
There are certainly some disadvantages to owning your own car. Here are three of the more commonly cited reasons why people often shy away from this option.
- Repairs can take a chunk out of your budget – When you own a car, that means that you own the repairs as well. As you car gets older, this means that they bills can really begin to pile up.
- Selling the car might not be easy – You might think that selling your car will be easy when the time comes, but people are increasingly hesitant to pay a lot of money for used cars. This is something to keep in mind. Also, the higher the mileage on the car when you go to sell it, the less money you will get for it.
- The car depreciates the moment you drive off the lot – You might have heard that a car is worth significantly less money than you paid for just moments after you drive off the lot. Well, it is true. That is too much for many people to stomach.
Cons of Leasing a New Car
- You will be limited in terms of the miles that you can drive – If you like to drive a lot, you will want to be mindful of the allotted miles in the terms of your lease.
- The car is not yours – Under the terms of a lease, the dealership maintains ownership of the car at all times. You need to keep it in nearly the same condition as it was given to you.
- It takes some good credit to get the best deal – The best terms on a car lease are not available to just anybody. You will need some pretty good credit if you are going to get the lowest possible monthly payment.
Pros of Buying a New Car
- It’s all yours – When you buy your own car, you are free to do with it whatever you want. If you want to turn it in a street racing machine, you can have at it.
- Ability to sell it whenever you want – If you grow tired of the car, you can always sell or trade it in to get a new car. With a lease, you would be locked in for the term of the lease.
- Drive as many miles as you feel the need to – When you own the car, you are free to drive as much as you want.
Pros of Leasing a New Car
- You get a new car every term – Every three years, you get a new car. It doesn’t get much better than that.
- The lower monthly payments are always nice – Compared to buying a car, you almost always get a lower monthly payment with a lease.
- No need to worry about selling your car before you can get a new one – When your lease term is up, there is no need to sell the car. Just turn it back in and then set out to find a new car to lease.
This is quite a bit of information to take in, but the bottom line is that leasing does have its advantages. Take your time, however, to consider what is best for you and your family before making your final decision. The important thing is to end up with a car that you love and with payments that you are happy with.