Buy my car or lease it?
If you’re looking to get into a new vehicle, you have two options, buy my car or lease my car. Both options are fine but it depends and what kind of financial commitments you want to have and the mileage that you think you’ll be driving.
Leasing my car
The first thing to understand is the general meaning of leasing. A lease is a type of loan from the bank or leasing institution. The lease is considered to be the least expensive way to get into a car that you might not be able to purchase. If you’re considering getting cash for cars during a trade in, that will build some equity into the lease. In a loan, we need to put the down payment for the car. This amount that is paid in the lease is supposed to return the amount to the bank with a certain percentage of interest. So by the end of the loan, the applicant does not owe anything to the bank. In the end the applicant has the choice to buy it or to pay the residual value of the car. There might also be the option to sell the lease and get cash for cars so you can get out of the lease fast and legally.
Leasing is very helpful in a number of ways. When you ‘buy my car’, you keep paying the loan installments every month and you own the vehicle even as it is depreciating in value. But when you lease a car, your savings will not be affected. Another advantage of leasing a car is that if the car has an accident then the insurance will cover all the damaged or you may be to swap out the old lease and get into a new car. When you buy a car and you have an accident, the insurance will cover only the equity difference and not the total damage.
Buy my car for cash
If you are thinking, buy my car, there is a long term benefit. It is obvious that you can’t change your car every two or three years but at least you own it and you’re taking good care of it and not trading cash for cars. That is why one tends to ‘buy my car’ rather than lease it. One of the best advantages to ‘buy my car’, is that there is no limit on the number of miles you drive, but when you lease the car you will have a yearly limit. If you exceed the limit then you will have to pay some extra money or trade cash for cars with the leasing company. When you buy a new car, you do not have to worry about the condition of the car, you just drive it from the showroom floor. But if you buy a leased car, you will have to check the condition of the car very carefully.
So there are advantages and disadvantages of both leasing and buying. The bottom line is that if you lease a car you can get into a newer vehicle that you couldn’t afford to buy.