To buy or to lease: that is the question. You know you want to drive a car, but can’t decide on whether to lease or buy a vehicle. Leasing gives you the opportunity to try a new car every few years. However, you aren’t building equity in the vehicle. Buying a vehicle is more of a commitment, but you’ll find that buying is a better choice in the long run. Read on to learn about the advantages of buying over leasing.
What’s wrong with leasing a car?
At first, leasing a car looks like a good deal. You get to swap out your car every couple of years, and at the end of your lease, you’re not required to buy your vehicle. Leasing allows you to drive luxury vehicles that you wouldn’t be able to buy otherwise. However, leasing a car is a poor decision in the long run.
Leasing your car may give you the chance to drive new cars every other year, but you need to adhere to the lease’s stipulations. The low monthly payments may be alluring. You ought to know that the commercials advertise the lowest monthly payment you can have—and that’s made possible by suffocating contract rules. For example, you can have a monthly payment under $300 a month as long as you drive no more than 10,000 in one year. Don’t think you’ll come close to 10,000 miles? The average driver easily exceeds that amount annually.
Also, you are responsible for repairs. If you return the car with any damage beyond normal wear and tear (such as minor scratches and tiny dents), you’ll have to pay heaps of additional fees. Paying thousands for repairs on a vehicle you don’t own feels like a waste. When you lease a vehicle, you also need to pay for gap insurance. If you total your car beyond repair, gap insurance pays the difference between what you owe and the car’s value. Perhaps the biggest insult is having to put a big down payment on a car you won’t even own.
Buying your car is the smarter move.
Buying a car makes more financial sense. Although most people take out a car loan, consider the fact that every payment brings you closer to ownership. Paying for expensive repairs feels a lot better when you know can keep your car for ten years. You don’t need to worry about mileage limits or any other restrictions. The only thing you have to do when buying a car is make your payments on time, make a down payment, and have full coverage insurance.