Driving a Car: Is It Better to Buy or Lease?
Driving a car becomes a necessity when you have places to go and things to do. You need a car, but the response to the question “is it better to buy or lease a car?” cannot be an objective type of answer. The answer depends on a multitude of factors and hence has to be subjective. The key factors that impact this decision are the finances, lifestyle and convenience. As we discuss the positives and negatives of both choices, you will be able to develop clarity on what you personally prefer.
Advantages of Leasing a car:
- Lower Outgoings Per Month
You need not make a down payment and your monthly rent for the rented car is lower than the installment you could be paying to clear the loan. Since you don’t buy the car, you don’t need to pay tax.
Downside: There could be other costs such as those for extra mileage, repairs or early termination of the contract
- Don’t Have to Worry About Market Value
Your car rental changes with the depreciation of that value of the car. Buying a car could make you reach a point where you owe more than the current value of the car.
- Opportunity to Drive New Cars
You can change your car with ever lease term and have the pleasure of driving newer cars of different makes each time
- Lower Repair Requirements
Since the cars are relatively new, they are covered by warranty and repair bills remain small. And you can change the car before it runs out on warranty.
- No Need to Worry About Resale
As you complete the lease term, you can simply return the car to the agency. You do not have to worry about finding a buyer for the car and other hassles associated with selling a car.
- Guaranteed Rental
For buying a car you do stand a chance of rejection of your loan request. There is no chance of rejection in rental.
Advantages of Buying a car:
- Lower Payment in the Long Run
Though the lease payments are smaller than the loan instalments, over a period of time, the total rental adds up to more that the cost of the car.
- You Have the Choice to Sell
You are not stuck with a car as you are in a lease agreement. You can sell it anytime you want
- No Restriction on Mileage
You can drive the car as much as you want to and have no regrets if you drove less or more
- You Can Choose the Appearance of the Car
You can keep the car as you want it without restrictions on decorating it or keeping it messed up
- Can Buy a Second-Hand Car
With a second-hand car, the depreciation value adds up to a good discount
Keeping all these points under consideration, you can choose which option works best for yourself. You can now decide – is it better to buy or lease a car?!