Leasing vs Buying

Many drivers ask, “Is leasing a car better than buying?” The answer depends on who you talk to, as leasing has many benefits. For starters, it is a cheaper alternative to buying because you’re not paying for the car outright, saving you money in the process. Additionally, because a lease is essentially a rental, you’ll typically have lower monthly payments than you would if you financed a car. 

Leasing guarantees you’re driving the latest model. So, if you enjoy getting behind the wheel of a modern car, this is an excellent option for you. This method offers the flexibility of jumping into a new lease at the end of the agreement. Furthermore, if you’re happy with the lease and want to keep driving it, you can finance or purchase it anytime. 

Often, leases are backed by numerous warranties. Many of them cover the cost of routine maintenance and repairs on specific components. This means you may not be responsible for out-of-pocket expenses for repairs and maintenance during your lease. 

Remember that when you lease, you’ll be bound to a mileage limit. If you exceed it, you may have to pay additional fees when you return the vehicle. There may also be fees for wear and tear, but it depends on the agreement. 

There are plenty of advantages to buying a vehicle over leasing. For example, an outright purchase means owning the car when you leave the dealership. You’ll incur no debt and can drive as far as you want right out of the gate because there are no mileage restrictions. You also won’t be responsible for wear and tear fees. 

Part of car buying vs leasing means you can finance your vehicle, which means you’ll pay back an auto loan in monthly installments. The goal is to own the car at the end of the payment cycle, but financing can give you some financial flexibility and a tremendous credit-building opportunity. 

Like leasing, there are some drawbacks to buying. Your vehicle will depreciate the second you drive it. Typically, depreciation is higher in the first few years of ownership. You may have a higher monthly payment than you would if you lease, but it depends on the car you drive and your down payment. Eventually, you’ll be responsible for the cost of maintenance.