There is more than one way to own a car. Owning a car is a must in this day and age where money talks and we have to work harder to support our families. Two options for owning your own vehicle are through leasing, or buying a car. Knowing the difference between the two, as well as the pros and cons of each option are useful in making a decision that will suit you and your budget in the long run. How does a lease car work? Is leasing more affordable than buying? Would I not save more money by buying a vehicle instead of making monthly payments towards a car I don’t really own? What kind of car would suit my needs and my pocket best?
What are the differences between leasing vs buying a car?
Leasing a car:
Taking part in a car lease program means driving a new car more often. Lease contracts are generally for 2 years, with the option to buy the vehicle at the end of the contract term. It is an affordable option, with things like maintenance and insurance included in the deal. No downpayment is required when leasing a car, but there are penalties for early termination of the lease contract. The disadvantages of leasing are that there is no real ownership of the vehicle. There might also be limitations on the mileage. Once you have reached your mileage limit per month, you will be charged a per mile rate. This can become quite costly. You are also responsible for any wear and tear on the vehicle.
Buying a car:
Buying a car is an investment. Being the owner of the vehicle, you are free to sell it at any time and possibly make a profit. There are no limitations on things like mileage when you own your vehicle. There are two ways to purchase your vehicle, namely cash or with financing from a bank or the dealer. It is important to do research on both, and then make a decision on which option is the best for you and your budget. The disadvantages of buying a car is that you are responsible for any maintenance and upkeep of the vehicle, which can be costly if there is a major problem. With financing, the monthly instalments are higher than if you were leasing a car. A bigger down payment is also necessary to buy your car.
When it comes down to making a decision on whether to lease or buy, you need to remember that it is all down to your driving habits and personal finances. Think about how much driving you need to do, and how much you can really afford to pay before you make your final decision. Using online searches to help you make your decision an easy one, with the vast array of search engines available. By reading as much as this topic as you can find, you’ll be able to make better-informed purchasing decisions for yourself.