This entry was posted on Sunday, July 5th, 2009 at 10:05 am and is filed under buying cars. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
July 5, 2009
When deciding to auto lease vs buy there are many things that should be taken into consideration before determining what option is best for you.
Questions to consider before buying a vehicle.
1. Is there a chance you may want to terminate your lease early?
Auto lease contracts are written to discourage people from terminating the lease early. Stiff penalties are imposed if the lease is terminated before the contract is up . Be sure you are in a financially sound position before you consider leasing a vehicle.
2. Do you usually drive more that 15,000 miles per year?
Lease contract limit the number of miles you can drive to a maximum of 15,000 mile per year. If you exceed the limit, you will pay excess mileages charges at the end of the lease which typically range from 10 to 25 cents per mile. In most cases if you know you will be driving more you can purchase additional miles at a lower cost per mile when you sign the lease.
3. Do you want to customize the vehicle or make alterations to it?
When you lease a vehicle, you do not own it. The vehicle belongs to the leasing company. As a result you cannot make modifications to the vehicle or install custom equipment such as stereos. This includes adding decals or logos to the exterior of the vehicle. If you modify the vehicle you will be charged for the cost of repairs to return the vehicle to its previous condition.
4. Do you abuse your vehicles or fail to keep them in good condition?
The leasing company requires that the vehicle be returned with normal wear and tear. Any excess will result in additional fees being charged. You are responsible for insurance and maintenance of the vehicle.
5. Do you plan to drive the vehicle for more then 5 years?
One of the benefits of leasing a vehicle is that you can drive a new vehicle every two to four years. This is a great option if you prefer to drive a vehicle that is always under warranty. The trade off is that you are always making monthly payments. If prefer to pay higher monthly payments and drive a vehicle that is completing paid off then buying is a better option for you then leasing.
If you answered yes to one or more of the questions above then buying a auto maybe a better option for you.
Questions to consider before leasing a vehicle.
1. Do you prefer a lower monthly payment? Lease payments are generally 30-60% lower than loan payments for the same vehicle. The cost is lower because you are only paying the depreciation on the vehicle.
2. Do you prefer a lower upfront fee? Most leases require little or no down payments. You have the choice of making a down payment or trading in a new vehicle, which will lower you monthly payments.
3. Would you like less maintenance concerns? Many people like to lease for a term that coincides with the manufacturer’s warranty. In the event that something goes wrong with the vehicle, it is always covered by warranty.
4. Would you like to pay lower taxes on a vehicle? When you lease you only pay the taxes on the portion of the vehicle you use or the depreciation.
If you answered yes to one or more of the questions listed above then leasing maybe a good alternative for you.
If you like the idea of leasing and want to pay even less for a lease vehicle consider auto lease buyout. Assume auto lease is the most cost effective way to drive a newer vehicle.
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