What Are The Differences Between Buying vs. Leasing?
The decision to lease or finance your new car used to be cut and dry. Leasing was once reserved for pricier cars, but it has become a viable option for a wide range of vehicles.
While leasing is becoming increasingly popular, it is still worthwhile to research both options and make sure whatever you choose makes sense. Our Little Rock VW dealer near Hot Springs has a finance center that is here with all the pros and cons of buying and leasing so you can make the decision that works best for you.
Leasing Pros And Cons
The past few years have seen lease prices steadily decline, which can be attributed to falling interest rates and lower mileage allowances. While these declining prices have caught the eye of a growing number of consumers, there are plenty of factors to consider when looking at leasing a new car.
On the plus side, leases are beneficial because it doesn’t lock you into a long-term contract while still giving you the option of buying the vehicle outright at the end of the term. However, if you think at the beginning of the term that you will want to buy the vehicle, it might be smarter to skip the lease and go straight to financing.
Something else to consider is the future value of the car. While it is true that the depreciating value of the car doesn’t affect you negatively as a leaser, you don’t own any equity in the vehicle, so you cannot use its cash value as you like.
Looking for a new car? Little Rock and Hot Springs area drivers can check out our new VW inventory along with an estimate of what the price would be, whether leasing or financing.
Financing Pros And Cons
Financing your vehicle could be the best option for you if you don’t mind a higher monthly payment and would prefer to call the car yours the moment your drive it off the lot. Higher flexibility in financing contracts as opposed to leasing contracts can make it a more attractive choice for many drivers.
If you decide that you’d like to move on to a newer model a few years down the road, you can sell the vehicle and use the money from the sale to pay off the balance of the loan. This is one of the biggest advantages over a lease that financing has.
The only downside of having the ability to sell or trade in your vehicle is that you’ll have to take care of it yourself. At the end of a lease, you simply return the vehicle and walk away and let the dealership deal with it.
While the car is yours to use without any mileage restrictions, the wear and tear and depreciation of the vehicle will negatively affect your wallet down the road. The same applies to customizing the vehicle; it’s yours to customize, whereas in a lease contract any modifications made must be removed before turning the car in.
Our knowledgeable staff is happy to help with any questions you have about leasing vs. buying a new car. Contact us today if you still need help deciding which the right option is for you.