What Are The Pros And Cons Of Leasing A Car?
If you’re shopping for a new car, you’ve probably got a price in your mind that you’re willing to spend. But as you shop around, you probably realize you can get a newer, nicer car for a monthly cost you can afford if you decide to lease instead of buy.
But what does a lease entail? Are you really getting a better deal if you decide to lease? How should you know if you should lease a new vehicle or make an outright purchase?
Leasing a vehicle has its benefits and drawbacks, all of which should be seriously considered before you make a purchase or sign a leasing contract.
To help you decide if leasing is the right choice for you, here are some pros and cons of leasing a vehicle that you should consider.
If you can’t afford to purchase your car outright, you probably will be taking out a loan to help cover the rest of the vehicle’s cost. This means you will need to pay a monthly amount until the amount of the loan is paid off.
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If you choose to lease a vehicle, you will also need to pay a monthly cost, but a lease is usually much lower than a loan. If you have a budget that you’d like to stick to you, you could be driving a nicer vehicle for the same price.
On the other hand, if you know exactly which car you would like, leasing could lower your monthly payments and put more cash in your pocket.
Con: You Won’t Own The Vehicle In The End.
When you’re making payments on a loan, you’re ultimately paying to own the vehicle. Once you meet the demands of your loan, the vehicle is yours to do whatever you please with.
Whether you want to continue driving it until it breaks down or you want to sell it to get money to purchase a new car, you are the owner of the vehicle and you get to make the decision.
When you’re leasing a vehicle, you’re only making payments to drive that vehicle for that month. At the end of your lease, you’re required to give the vehicle back to the owner.
Pro: You Get to Drive a New Car Every Couple of Years
Because you don’t own the vehicle, you aren’t stuck to an item after the loan or lease period ends. Instead, you get to give the vehicle back to the dealership and select a new car that you would like to lease.
Leasing a vehicle instead of loaning can be a great thing for car lovers or those who always want something new and exciting.
While leasing a vehicle, a 3-year contract is standard – a much shorter period of time than most individuals take to pay off a car loan.
If you think that you’re going to grow tired of your vehicle in just a couple years, you may want to lease instead of loan.
Con: You Can’t End Your Contract Early
When you buy your car, you can sell your vehicle if times get rough – even if you still have a loan that you need to pay off.
This can get you out of making your loan payments and give you a bit of cash in your pocket if you’re in need. This can also be beneficial if you move to a city where you don’t need a car.
But if you lease a vehicle, you usually can’t break that lease until the agreed upon time period is up. You’ll need to continue paying the monthly payments whether or not you’re still driving the vehicle or how much you’re struggling to afford the payments.
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Pro: When The Lease is Up, You’re Free Of The Vehicle.
If you’re not looking to have a car long term, leasing can remove the stress and hassle of trying to sell the vehicle after the agreement terms are met.
If you’re living in a temporary place where you’ll be moving in a few years, such as if you’re a military family or temp job, a leased vehicle may be right for you.
Because you do not own the vehicle after you’ve paid your extent of the lease, you’re free to let it go when the contract is up.
You don’t need to worry about selling it if you no longer want to own the vehicle and you don’t need to worry about the expansive paperwork that comes with purchasing a vehicle.
Con: You Could Be Charged For Normal Wear & Tear
No matter how careful a driver you are, it is natural to get a few dings or scrapes in the vehicle – especially if you need to park it on a public street. In addition to potential light damage, driving the car adds miles and the whole reason to have a car is to drive it.
However, you may need to pay extra penalties when you return the vehicle if you drive the car too much.
If you instead choose to purchase a vehicle, you’re free to drive it however you please. It is your car to maintain, so no one will hold you accountable if you put too many miles on the car or it gets a few small dings.
Leasing a car can bring many benefits, but they need to be the right benefits for you and your situation if you want to be happy with a leased vehicle. If you’re looking for a short-term commitment, a lease may be the right decision for you.
If you’re hoping to be a car owner, you may want to skip a car lease and go straight for making a car purchase.