Car buying is where a buyer would finance and purchase a car which will make him/her have its total ownership. This is an official agreement between the purchaser and the cars dealers or the person who is selling the car could it be a second hand. It is then registered under the customer’s details where one will have the log book with their details. The owner is responsible for maintaining the car for any mechanical problem with it as he owns it.
Car leasing is renting a vehicle because you don’t have its ownership. It is the situation where you make a contract and hire a vehicle by paying an initial deposit amount which mostly probably less twenty percent the cost of the car, then one would consequently make payments monthly over a period which is fixed. It is also an official agreement with the car dealership company. The car is usually handed back to the company when the leasing period elapses or purchase it at an amount of the residual value. The company is responsible for maintaining the car during the rental period.
The reasons which would make one interested to lease a car than buying a car are such as;
One would only finance depreciation of the car leased; hence it only requires small down payment saving
When one rents a car, he/she would only pay an initial deposit and make monthly payments during the leasing period which is not very high. This would only cover for the car depreciation which is torn and wear. It makes many interested because it is cheaper as compared to car buying which requires one to have a huge amount to purchase the vehicle and even if one would purchase it on loan the monthly payments will be high which would favor car leasing.
Car leasing helps an individual to get a new car within a short period
When the rental period elapses, the car is returned to the car dealership. This does not give one hard time to find for customers to buy the used car or to do a trade-in. As long as one has complied with the terms and conditions they had with the leasing car company. One would probably return the car and make another agreement with the business and get a new car. In the case of car buying, this is not possible as one would have to get an amount which can purchase the vehicle interested in.
Car leasing is adequate for short term period car needs
An individual could be interested in venturing into a business which would take a short time. Car rental is the most efficient way to get the vehicle because it needs a little amount of initial deposit and small monthly down payments. This would be cheap also because the dealership company will maintain the leased car. As compared to car buying which would require a significant capital outlay and also the maintenance cost would make it more expensive for a short term period business
My perception I would go for car leasing because its advantages such as requiring a small down payment to cater for the motor vehicle depreciation, one is to get a new car within a short period and also to make it compelling for those venturing into a short-term business, outdo those of car buying.