Buying vs. Leasing: Which is Right for You?

Getting a new car is one of the biggest purchases most of us make. Since many people have to finance this new vehicle, the question of whether to purchase or lease can be confusing. And this is a question that is hard to answer. It breaks down to both a dollars-and-cents question AND personal tastes and priorities

Below, you will find a quick list of Pros and Cons for purchasing and leasing a vehicle determine what your needs are and what suits you best.

Benefits of Leasing a Car

• Many shoppers are able to get more car for less money
• Many leases last about three years, which is typically the length of many new car bumper-to-bumper warranties
• You would be able to get a brand new car every few years
• You can generally buy the vehicle at the end of the lease if you have fallen in love with it
• Down payment is usually low, and sometimes non-existent

Drawbacks of Leasing a Car

• Limited amount of miles you can drive each year
• You generally can’t make any major alterations
• You are “borrowing” the car for a few years and paying interest to finance that car
• You do not build any equity
• You do not own the car after the lease
• You’ll have to pay extra charges for exceeding what is considered normal wear and tear

Benefits of Buying a Car

• You can keep your car as long as possible
• You can alter the car as much as you like
• No mileage restrictions
• You can easily sell the car whenever you want
• You don’t have to worry about wear and tear

Drawbacks of Buying a Car

• You roll the dice a bit with resale value
• You may have to have a larger down payment
• You may have to pay more in interest if you have to stretch out the loan
• You are responsible for maintenance costs when the warranty expires
• Payments are usually a little higher since you are financing the entire cost of the vehicle

These are just a few of the details involved in choosing whether to lease or buy. If you find yourself with further questions, feel free to contact us anytime at 989.922.5514.

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