You need a car, but you are not sure if you want to lease or buy one. It is tough to decide what to do since you will be making payments for a couple of years. While some people argue that buying is best since the car will be yours and you will not need to return it, there are benefits to leasing that you should consider.
Lower Monthly Payments
Many people cannot deal with the monthly payments associated with financing a car. These payments are usually large due to the APR but also because they were calculated using the entire value of the car at the time of purchase.
Some people have to factor in their credit score, which could increase the amount you will pay. Lease payments are not excessive. There are times when the payments are 30 to 60 percent lower than the monthly payment of a financed vehicle. The payments are not based on the entire value of the car but the depreciation value during the lease term.
No Down Payment
Coming up with the down payment can be hard. Some people take out additional loans or even use credit cards to come up with the money that is asked of them. The payment is usually a significant amount of the sum owed, but it does vary depending on the car you choose. Those who have the money are still letting go of a good chunk of their savings, which can be hard to make up.
Car leasing does not require you to pay such a large amount when you walk in to lease your car. You are not required to provide more than the fees and taxes owed. You are also expected to pay the first month’s installment, but this is only a fraction of what a down payment might be. This makes it a lot easier to drive away in your brand new vehicle should you decide to lease.
Those who lease cars will tell you that they love knowing they are going to be able to return their cars and get a newer model in about two to three years. They might even tell you that they get to drive around in luxury vehicles for a fraction of the monthly payments one might pay for a financed economy vehicle.
A person who has a job that demands a reliable vehicle at all times would benefit from leasing a car. You get the opportunity to drive cars that are equipped with the latest technology and are likely safer than older models. These are just some of the perks of leasing instead of buying.
A leased vehicle is not really yours since it belongs to the leasing company. This means the company wants to make sure you return the car in good condition. This is the reason a leased vehicle is taken care of by the dealership should anything major happen.
You will have to keep up with maintenance appointments, and you cannot drive the car beyond the amount of miles allowed per month, but the benefits outweigh the limitations. You will not have to worry about paying a mechanic those incredible prices or worry about finding one that you can trust.
You can trade in a car that you own when you lease a car. Most people think that dealerships only accept trade-ins if you are purchasing a car, but you can do this if you are leasing. This could help lower the amount you owe on the lease, which means your payments will be lower.
Those who do not have a valuable car should still consider it because every little bit helps, and any bit of extra cash will help you in the long run. Be sure to ask your sales person about additional ways that you can save like leasing a lower priced vehicle.
You should know that most states in the US do not charge sales tax based on the entire value of the car. This is something you have to do if you purchase the car. Those who decide to lease the car will only get taxed for a portion of the value of the car, which is a lot lower. Besides, the taxes are spread out throughout each monthly installment, so it should be easy to deal with.
A person who uses the car for businesses purposes might be able to deduct a portion of what you spend on your leased car. This is something that cannot be applied to purchased cars, but you can take advantage of this if you lease the car. It is important that you talk to a tax specialist about this, and be sure to keep records.
This information should help you make a decision regarding purchasing or leasing a vehicle. Talk to a leasing or sales representative if you have more questions.