While the choice to lease a car or buy has financial implications — money is not the only thing you can weigh before pulling the trigger on a contract. Your personal preferences and lifestyle will also play a major role in how you want to purchase or lease a car.
About 20 percent of all new car sales are leased, and it’s obvious there are still people out there who enjoy the thought of commuting in a new car always.
Yet which choice is the right for you? Okay, whether to lease a car or not depends on a number of things like how much money you have (both upfront and for a monthly payment), how much you drive, and how much time you want to spend in the vehicle.
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SHOULD YOU BUY OR LEASE A CAR?
Whether you choose to buy or lease a car depends wholly on your goals, budget, and personal preferences.
Before you continue your hunt for your next vehicle, you will take the time to determine what you want to get out of it, what conditions you are happy with, and the financial consequences, letting those considerations guide your choice.
Here are some of the best benefits you’ll get if you lease a car, followed by some of the drawbacks you’ll get if you lease a car. Look around and decide for yourself which choice would appeal to you the most.
Benefits You Get if You Lease a Car:
New Car, the whole time.
Leasing a car means you still get a nice new ride to drive around. This is an emotional boost for many people which cannot be overlooked. This is a major bonus if you enjoy cars and driving.
Few maintenance issues.
Since you’re driving a brand new car the least bit times, you should not usually handle the traditional maintenance problems that car owners face as their vehicle age. Before any of those issues arise (e.g. poor brakes or shot transmission) you switch your car in. When you’re living a very busy life, or you’re on the road lots, that’s one less burden you have to face.
To small companies leases are tax-deductible.
If you are self-employed or have a company, you can write off your lease as a cost for the company.
Afford A Premium Car.
If you’ve ever wondered how so many people are able to afford to drive BMWs and Range Rovers, then no more wonder. Roughly 75 percent of all luxury vehicles are rented, the explanation for this is that banks don’t like loaning more than $30,000 for a car loan. When you want a car worth more than that and you don’t have the money to make up the difference, it’s your only choice to buy. On the upside, your monthly cost is smaller than when you’ve previously purchased a vehicle. If you had to buy it, leasing helps you to “afford” a better car than you would otherwise.
Less cost upfront.
When it comes to pricing, leasing allows you to get into a car with very few “upfront” costs. Perhaps you don’t need a down payment (or if you do, it’s pretty low), your monthly costs are lower, and the income tax would be even lower because you just have to pay tax on the value of the vehicle you’ve actually been using. This means you would pay only half the sales tax you would have if you bought the car over the duration of your contract.
Drawbacks you’ll get if you Lease a Car:
The lease contract sum doesn’t adjust, even after an incident.
When you get into a car accident and the vehicle is damaged, you’ll still be liable to pay back the entire lease contract sum. And if the insurance firm refunds you less than you owe to the broker, you will be responsible for the entire sum. When you are leasing, at least be wise enough to buy gap insurance that will cover you for the difference you owe to the dealership.
If you lose a job or experience a heavy financial burden and are no longer able to afford the bill, the dealership will recover the car and sell it on sale. If they rent it for less than you owe for the lease agreement, you are legally responsible for paying the difference.
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No possession but still in charge of repairs.
Leasing a vehicle means it’s not yours; you are liable for any repairs which are not protected by the warranty. But when you turn in the car you don’t take advantage of the investment you’ve made in that vehicle. Leasing a vehicle also means you cannot change it like you would if you leased it And if your kids spill the paint on the backseat, or your dog nibbles a piece of the upholstery when you turn the car in, you’ll have to pay extra for “wear and tear.” It’s not fun.