You’ve done all your research. You’ve compared gas mileage, safety ratings, luxury standards, even style and color. Now, it’s time to buy your new vehicle.
But it’s not quite that simple. You’re faced with one last important, complicated decision – do you lease a car, or do you buy one? There are benefits and downsides to each option, and it’s best to understand exactly what you are getting yourself into before you make a decision. To help you make an informed decision, we have compared the two options below, outlining exactly what you can expect to find should you choose to lease a car or to buy a car.
Updated on June 29th, 2016
| Leasing a Car | Buying a Car | |
| Payments | You pay a small initial down payment and then low monthly payments. It is more economical in the short term, but in the long run, you end up paying more. | When you buy, you purchase the car outright, which results in a very large, one-time payment. More expensive in the short term, but in the long run, you end up paying less than a lease. |
| Ownership | You don’t own the car outright, and therefore cannot modify it or sell it on your own without breaking your lease. | You own the car, and can modify it and sell it if and when you choose. |
| Repairs | Low repair costs. With most three-year contracts, the repairs are often covered by a factory warranty. | High repair costs. You own the car, so any repairs that need to be made are paid for out of pocket. |
| Miles | Mileage cap. Most leases limit your mileage to between 12,000 – 15,000 miles a year. | No Mileage cap. You put as many miles on it as you see fit. |
| Trade In | It is easy to trade the car in every few years, so you have the option of constantly driving a new car, or the newest models. | Trade-ins are difficult and expensive because you don’t have a lease. Your options are often limited to selling your vehicle and then buying/leasing a new car. |
| Wear and Tear | Wear and tear over the course of the lease can end up costing you when your lease comes to an end. | No wear and tear costs, besides personal repair costs, which are done at your discretion. |
| Early Lease Termination | Terminating your lease early can be quite costly. | No lease, and therefore no termination fees |
| Taxes | Lower tax payments. You only pay taxes on the portion of the car that you have financed. | Higher tax payments. You pay all of the taxes on the entire car at signing. |
There is no right or wrong decision when it comes to making a decision between leasing a car and buying one. The most important thing to remember is to carefully weigh your options, and make an informed decision based on all of your preferences and requirements.
To learn more about financing a car, visit Nutley Kia Finance Department. Our specialist will answer all your questions carefully.
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