When it comes to driving a car, you ultimately have two options available to you: buying or leasing. The majority of people who are looking to drive are interested in buying their car outright, but there are a myriad of disadvantages to actually owning a car that so many people aren’t aware of before signing along the dotted line and taking out a loan. For one, the loan you take out will often be for five to seven years and, during this time, your car will depreciate in value and require major repair work before the vehicle’s even paid off. This is why leasing has started to be the prime choice for those who need a reliable car without the headache of owning one.
Understanding the Basics of Car Leasing
Car leasing is essentially like renting the vehicle. You will sign a lease contract that is typically for two or three years. During that time, you can drive the vehicle as you normally would and when the contract is up, you’ll have the option to re-sign the same vehicle or get another. You can relate car leasing to renting an apartment where you still have the joys of having a place to call your own, but you’re not responsible for half the issues a homeowner would have to deal with themselves.
Reasons to Lease a Car vs Buying One
Here is a list of reasons you might want to consider leasing a car over buying one:
No Sales Tax –When you purchase a vehicle, you’re liable to pay a hefty sales tax on the sale of the car. This can be incredibly expensive and can cause an affordable vehicle to turn into one that you simply cannot buy because of your financial situation. Leasing gets rid of this sales tax because you’re not actually buying the car and are not responsible for paying the tax on the sale.
Ability to Change Vehicles –Leasing allows you to change vehicles depending on your needs and desires. Let’s say that right now you don’t have a big family and a smaller vehicle is perfect for you and your partner. Five years from now, you may need a larger vehicle because of having one or more children. The lease agreement enables you to change vehicles when your contract is up and offers the flexibility that most people need.
No to Low Down Payment Required –Buying a car can be a nightmare when you consider the down payment required. Unfortunately, the down payment can make or break the sale of a vehicle, but leasing a car prevents this from becoming an issue. Most lease agreements require either a low down payment as a security deposit or no down payment at all.
No Need to Worry About Trading In –When it comes time to get a new vehicle, you don’t need to deal with a hectic and frustrating trade-in. So many families deal with the nuisance of trying to trade in an older vehicle for a new one only to find that their car’s depreciated in value and they’re only getting a fraction of what they paid for it. Leasing allows you to give the vehicle back to the company and simply choose another one with no trade-ins involved.
No Worries Over Repairs –The vast majority of leased vehicles are strictly under factory warranty with a variety of other guarantees and warranties that benefit the driver. If you need major repair work, you may not have to pay a lot of money or anything at all to have it done.
Is Leasing Right for You?
Leasing is perfect for the family that needs a different car after a few years and those who don’t want to be tied down to one vehicle for a decade or more. It’s also a great way to save money initially because no sales tax or down payment is required to drive off the lot. It’s important that you do all of your own homework beforehand, but leasing has been a great choice for so many individuals and families.