What's the difference between leasing and financing? It's a common question, and an important one. Buying or leasing is a decision only you can make, but it's one we can help you with.
For many of us, buying a car is the biggest purchase we'll make other than a home. We want to help you choose the best way to buy a car for you and your needs.
If you don't plan to write a check for the full price of the car, you're going to need to decide if it's better to finance or lease. Let's look at how these two ways to buy a car compare so you can choose the method that gives you what you need.
Leasing vs. Financing Comparison
| Leasing Benefits | Financing Benefits |
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Always have something "new."
- Many finance contracts go from 4-7 years, but lease contracts typically last for 3 years, which makes it easy to have a new car with the latest tech and safety without risk.
| Make it yours.
- When you finance a vehicle, you are the owner, which means you can customize the car to your liking. A lease agreement limits your ability to make cosmetic upgrades.
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Enjoy the best miles.
- A lease contract can be customized to have an annual mileage limit that suits you, typically 10,000 - 15,000 miles per year. So over a three-year lease, you can drive the car up to 30,000 - 45,000 miles without paying an overage penalty.
| Drive as far as you want.
- If you rack up heavy mileage every year, financing a car gives you the freedom to drive as many miles as you want without financial penalty.
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Leasing gets you more.
- Many drivers find they can get a more expensive car when they lease because they're only paying for a portion of the vehicle's value over a set period of time. This means lease payments can be lower than finance payments and give you the chance to get a higher trim model at a lower payment.
| Peace of mind from "wear and tear."
- When you turn in a leased vehicle, you may be responsible for paying for any excessive mileage and damage that goes beyond the scope of normal wear and tear as defined by your lease contract. All those wheel scrapes, door dents, and upholstery stains/tears are your responsibility. This can be avoided with the Excess Wear and Tear Protection Policy available in the business office. When you finance a car, what you decide to fix is up to you.
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Depreciation isn't a factor.
- When you lease a car, you aren't investing in your purchase. You don't have to worry about a vehicle decreasing in value over time or how much you can get for your used car when you need to sell your vehicle. You simply turn in your leased vehicle when you're done and walk away.
| Own what you drive.
- When you make finance payments, you will own your car at the end of your contract and have something of value in the end. When you lease, you're essentially renting the car for a set time period and in the end, you simply give it back.
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As you can see, both buying strategies have their benefits. Now that you know more about how buying compares to leasing, you can make an informed decision and pick out a new car at our dealership you'll love to drive.
