Leasing is still a popular financing option for new car shoppers. In a recent study by Experian Automotive, it was found that 28% of financing deals for new cars are leases. Although buying remains the most popular option by far, there are many benefits to leasing that are frequently overlooked.
The key benefit to leasing is cost utility. Essentially, you get more for less by leasing a car. Unlike a typical loan, where you make payments for the full cost of the car at time of sale, a lease allows you to pay the difference between the current value of a lease car and its expected future value at the end of the lease.
Cars are notorious for rapidly depreciating in value, and thus are considered a terrible investment, unlike a home. While this is a significant drawback to buying, it works to your advantage in a lease. Additionally, this significantly reduces the down payment required to drive the new car off the lot. Many dealerships even offer free maintenance for leased vehicles.
One oft-cited drawback to leasing is that the deals are short-term and that you don’t actually own the car by the end of the agreement. Many savvy drivers, however, make this supposed disadvantage work in their favor. Leasers never have to drive an aging, outdated car. Every three years or so, they get a brand new vehicle. Because of the reduced cost of leasing, these are often more luxurious cars than would otherwise be affordable.
Dealerships in every city offer leasing arrangements. From New York, to Washington State, to the Midwest cities of St. Louis and Minneapolis, anyone from anywhere can lease a car. Residents of southern California will have little difficulty finding a car lease firm in Los Angeles.
Leases are not for everybody, but for people of particular circumstances, they can be the best option. Those with solid credit scores will find leasing agreements enticing and easy to qualify. If you need to impress business partners or clients, leasing a luxury sedan will get the job done without setting you back too much.
Nomadic types who move around the country and rarely stay in one place for more than several years will find short-term leases a perfect fit for their lifestyle. It’s all about making the nuances work to your advantage.
Leasing: Pros & Cons, dmv.org
Leasing Bounces Back, forbes.com