When if comes to buying a car, there are a lot of choices and decisions. You will have to select the make, model, options, and color of your vehicle. However, there is one decision you may not have considered. When selecting a vehicle, you will also need to decide if you want to lease or buy a car. The price and terms will change based on which option you select.
How-to Decide If You Should Lease or Buy a Car: Things to Consider
Pros and Cons of Leasing
When deciding if you should lease or buy a car, you will need to consider the pros and cons of each. There are several major pros to leasing a car. First, you likely will not have to worry about paying for the maintenance on the vehicle because it will probably be covered by the warranty. This may include tire rotations, oil changes, and new wiper blades. A lease can be a good idea if you typically drive a consistent number of miles per year. Leases often cover anywhere between 10,000 to 12,000 miles. Oftentimes, the monthly payment for a lease option is less than it would be when purchasing a vehicle. You may be able to put less, or even no money down as well. This is a great option for someone who is willing to constantly have a car payment but get a new car every few years.
There are also cons to leasing a car. Usually, leases have mileage caps that could be between 10,000 to 12,000 miles a year. If you go over this mileage amount, you may have to pay extra fees and penalties. In addition, you may have to pay costly wear-and-tear fees at the end of the lease. For example, they may require the tire treads to be at a certain depth or make you purchase new tires. If you do end up deciding to eventually buy the car, it’s more expensive at the end of the lease than if you bought it outright from the start.
Pros and Cons of Buying
You will also need to think about the pros and cons of buying when deciding if you should lease or buy a car. One of the biggest pros of owning a car is that it is all yours. Plus, once you pay off the car, you are done with your payments. Owning will help you to avoid any extra charges that come with leasing.
On the other hand, there are some downsides to owning a car. For example, you will have to pay more money upfront and likely have a higher monthly payment. Over time, you will have to pay for repair and maintenance expenses. Plus, your vehicle will depreciate after you purchase it. You will see this depreciation when it comes time to sell the vehicle.