There is always this argument of which one is better, buying or leasing a car.The clear answer is “It depends on your personal situation and needs.”
Although most people purchase a car, leasing is a very good alternative for someone who wants to have a low monthly payment or who just want s to experience a brand new car often. Yap, I know someone who actually is like this!But be very wary when going to the dealership as most salesperson will push for the lease because of a higher commission that they’ll get.
Advantages of Leasing A Car
1. Cars depreciates in value and lessees don’t have to worry about this.
2. Drivers don’t have to deal with hefty maintenance bills.
3. A lease may offer lower monthly payments, for people with good credit, and lessees can invest the difference in a mutual fund for a higher rate of return.
4. Consumers will always have purchasing flexibility – after a lease term, choose another car. It’s like a three- or four-year test drive.
5. Unlike financing, the terms on the lease are normally less than 5 years. Many consumers can drive away with the latest model, even a luxury car, with less cash upfront.
6. Lessees can enjoy the latest safety and technology innovations on the road
7. You can write off your leasing payment as a business expense (subject to IRS restrictions) if you’re a business person.
Advantages of Buying A Car
1. You don’t have to deal with any restrictions that are common with a short term lease.
2. Your monthly car payments ends either after 3 or 5 years depending on your financing terms – leasing offers no such relief.
3. You don’t have to worry about mileage limits per year. Lessees have to pay an additional amount for every miles over the limit.
4. Car owners can also worry less about wear-and-tear. They don’t have to return the car and get penalized for additional money if they return the car in poor condition.
5. Future owners looking to finance will enjoy large cash rebates and low-interest financing (assuming you have a very good credit)