Acquiring a vehicle is not a walk in the park as most can perceive. In the real sense, the workload of getting a car is felt when one needs to land on the most favorable decision concerning the finance of the project. One is involved in several talks concerning the value and the final consideration of the car. Other than the seller engaging the buyer to be in the best position for himself, he also has to make up his mind on whether to buy or lease the vehicle. The biggest problem to solve would be which of the decisions is best for the buyer.
Many purchasers have not been involved in the leasing of cars as the process and activity may be confounding, hard to handle and the buyer may have the perception that the business is in favor of the seller. However, this is not the case, and therefore the car buyer should develop an interest and deep understanding of various acquiring ways.
The benefits of buying a car.
The most obvious advantage of purchasing a car through purchase is that one has the chance to possess it fully. After completion of the acquisition, one is discharged from any other payments to the seller. Any other deal involving the acquirer would be when he becomes the seller.
Fully purchasing a car benefits the owner in insurance policies as the value of premium tends to be lower than in a leasing agreement.
A buyer is not tied to restrictions on the use of mileage which usually involve some punishments. More so, one is not restricted to a fixed time to use the car.
The upside of leasing a car
Car leasing can be done through two ways; either the close-end or the open-end way. Close-end does not tie the leaser to buy a car at the end of the agreement as does the open-end.
Leasing of vehicles would be convenient in that the total cost involved is lower than the cost of buying and maintaining the asset. Leasing would need a small amount of down-payment or none at all and no charges on tax are negated from the buyer.
The setback of the decision to buy is that the overall cost will be higher than when leasing. There is the aspect of depreciation which can be an unfavorable factor in the buying of the automobile. As at the time payment has been completed in the case of a loan, the value of the car would be lower than when the first installment was made. When one leases a vehicle, he is using it for an agreed or stated period, say 24 months and the leaser is expected to pay for the service acquired for that particular time. One is not forced into the costs of depreciation hence reducing the risks of loss.
The payments made monthly are always smaller than and the buyer has the advantage to possess a new automobile after a period.
When fully acquiring a car proves futile, then leasing is the best alternative. Those that depend on loans to get cars suffer the setback of banks as most of the financial institutions have restrictions on some funds they are willing to lend.
For those that operate businesses, the art of leasing proves to be beneficial in that they gain from tax reliefs if the car would be for the operation of the business only.
Therefore, for business entities, it would be a better idea to lease vehicles rather than buy them as the principal objectives of companies is to make a profit which involves reducing costs.