When you're looking to upgrade to a brand-new car, you have two main options to help get you there: leasing or buying. In contrast to purchasing a new vehicle with cash or through financing, leasing a new car is similar to renting the automobile for a pre-determined amount of time, typically two to four years.
Some drivers enjoy the flexibility and affordability of a lease, while other motorists swear by car ownership. So which is right for you? Well, it depends largely on your situation, expected annual mileage and general preferences! Here, we'll review some of the major benefits as well as some drawbacks of leasing a car so that you can make an informed decision whether to buy or lease.
When you lease a new car, truck or SUV, certain benefits come along with this arrangement. For starters, you can typically enjoy a significantly lower monthly payment when leasing compared to if you financed the same vehicle, since you're only paying for its use, not to own it. In other words, you can get more car for your money by leasing rather than buying or financing. This also helps motorists that are seeking low monthly payments afford to drive a dependable, brand-new car!
Maybe you'd like to drive a new vehicle, but you don't have much saved for a down payment. With a lease, securing that new car with a small down payment or no money down is much more likely than with an auto purchase loan. Where many lease offers include no money down or perhaps $1,000 down, car buyers often put down as much as 10 to 20 percent or more of the vehicle purchase price.
Leasing also gives you the benefit of driving a new car every few years, and who wouldn't want to do that? Since most leases run for two to four years, at lease end, returning your vehicle and selecting another car for your next lease is hassle-free. It's not so simple if you finance a new car for five or more years and you want to get out of it before you've paid it off: you'll have to try to sell the car yourself.
When you lease a car for two or three years, your obligation stops at lease end, and you often have the option of buying out your lease if you decide you'd like to keep driving the car. With a new car purchase, there is no pre-determined end, as you're financing the car to own it, and whenever it's time for you to upgrade again, you'll likely need to sell or trade-in your vehicle first.
While drivers find many benefits to leasing a car, there are some potential drawbacks to keep in mind. When you lease a vehicle, there are mileage restrictions that are determined when you sign, such as an allotted 10,000 miles per year. You have the option to increase your annual mileage allowance, but that will also increase your monthly lease payment. If you tend to put tens of thousands of miles on your car in any given year, leasing may make less sense for you. Or, if you're concerned about fees for going over your mileage allowance at lease end, you may also want to consider the option of buying.
Beyond mileage restrictions, there is also wear and tear to consider when planning to lease a new vehicle. Since you are renting a car when you lease, the lessor expects that you'll return the vehicle in good condition at lease end. If there is excessive body panel or interior wear or damage when you return the leased car, you may have to pay a fee. If you take good care of your vehicle, then this aspect shouldn't be something that keeps you from leasing your next car.
Just like with buying versus renting a home, there are perks to both leasing and purchasing a new car. When you buy a car, you're building equity in each car payment. Whenever you decide to sell your car, the money from the sale is all yours. If you lease, you are simply renting the car for a few years, and that's what your monthly payments go toward. If you continue to lease vehicles one after the other, then you're guaranteed to always have a monthly car payment, albeit at a typically lower price than with a car finance payment.
We've gone over some of the perks and drawbacks that can come with leasing an automobile, so now it's time to determine whether buying or leasing makes more sense for your situation. If you like to drive a new car with the latest technologies and features every few years and want a lower monthly payment, then leasing may be the way to go for you! Likewise, motorists who prefer to drive their car for many years before upgrading may find added value in buying their next vehicle.
When you're after convenience, flexibility, affordable monthly payments and more frequent upgrades to a brand-new ride, we encourage you to consider leasing! As always, the sales and finance specialists here at Premier Honda are here to assist you and answer any questions you may have about leasing or buying your next vehicle.
We provide many online resources and tools here on our website that can help you make an informed decision about how to go about getting into one of our new Honda automobiles for sale in New Orleans, LA.
Be sure to view the current Honda lease offers and finance options for your particular Honda model of choice, as this may help you determine whether to go the buy or lease route!