Do I lease or buy a new car? It depends, would be the answer. The two options have their advantages and disadvantages. In this note, without trying to be exhaustive, we explain.
Advantages of leasing:
The entry money for the lease is low, and in some cases nonexistent. The guarantees are covered by the contract. The monthly payment is less than the purchase. In addition, it does not matter that the car is deprecated during that time of the lease.
Disadvantages of leasing:
The vehicle is not yours. The leased car has a limited number of miles to travel for a year. If the limit is exceeded, a penalty must be paid. In the lease, there is a fee for excessive wear and tear on the vehicle. Early cancellation of the contract is penalized. On the other hand, the monthly insurance premiums are higher since they must meet the standards of the leasing company. You have to service the vehicle according to the manufacturer’s recommendations.
Advantages of buying a new car:
The first advantage is that you can haggle the price of the car at the dealership. In addition, you acquire ownership of a vehicle. Therefore, it has no annual distance limitation. You can sell it at any time. If you like to modify your cars, you have no impediment. In general, the cost of insurance on an owned car is lower.
Disadvantages of buying a new car:
It is not possible to predetermine what your selling price will be. The monthly fee payment is generally higher. The vehicle depreciates over time. When buying it, the down payment is higher than a lease.
Do I lease or buy a new car?
If you are a person who must change a car every two or three years, the best option is leasing. But if your idea is to keep the vehicle for a long period of time, it is advisable to buy it.
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