Both buying and leasing are two viable options for different financial situations. Whether you’re on a budget, want the latest tech, or need a car that will run for years to come, buying and leasing both have their benefits and drawbacks. Here’s a quick breakdown of the pros and cons of buying and leasing so you can make the right choice according to your lifestyle!
Buying is fairly straightforward. Once you pay off the loan, the car is yours to do with what you will, and there will be no more monthly payments. You can modify it to your heart’s desire, drive as many miles as you want, and you don’t have to worry about small damages.
On the downside, buying a car means you’re responsible for all repairs once the warranty is up. There’s no certainty when it comes to resale value and an auto loan can last for years. Buying a car usually requires a hefty down payment, as well.
Leasing a car is a little more complicated than buying a car. When you sign a lease, you’re effectively renting the car for the duration of the contract. During that time, you’re paying for part of the car based on a predetermined value at the end of the contract. A lease is perfect for those who want to have the latest tech every few years, since they typically last two to three years.
With a lease, you aren’t building any equity. Leases also come with mileage restrictions and you have to be careful about stains and spills. You also can’t modify the car much, if at all. Any violation of the lease could result in extra fees, as well.