In the planning stages of a car purchase, one of the questions you will ask yourself is how to finance the vehicle’s payment. Car dealers will usually offer you one of two choices: apply for a car loan through a bank, or apply for a loan through their in-house financing. Once you’ve identified the ideal financing plan for your situation, the next thing you need to ask yourself is whether you should buy or lease the car.
If you’re like most people, you probably can’t afford to pay the entire vehicle cost in one go, so you need to weigh your options over which arrangement will suit you more: to buy or to lease. Determine which one feels more comfortable for you given your current financial capabilities. With that in mind, below are the advantages and disadvantages for each.
Car ownership is the biggest benefit of buying a car—it will be all yours once you’re fully paid. You can sell the car if you choose, and you won’t be trapped in any type of fixed or co-ownership legalities with the vehicle. In terms of insurance policies, the limits usually imposed by insurance is typically lower in buying than in leasing.
If there’s one notable drawback to buying, which is the higher cost. Compared to leasing, the down payment, monthly payments, and interest rates you have to make will be bigger. Depreciation could also be a problem. New cars rapidly depreciate in value, and should you decide to resell the car in the future, you could end up with an amount that’s lower than what you owe the bank or the car dealer.
To lease a car in Los Angeles often requires little or no down payment. Monthly payments are also lower. The good thing about leasing, especially for those who like changes every few years, is that you can have a brand new car every couple of years. You may also drive a vehicle that is well above your buying capacity; leasing makes it possible to take home a luxury car or an SUV.
The disadvantage with leasing is that you’ll see no end to the monthly car payments you need to make. You’ll also have mileage restrictions. Once you go beyond your allotted miles, you’ll have to pay the corresponding amount for the total miles that went over the limit.
So, which one should you choose? It all depends on your particular situation. Seek a reliable and experienced Los Angeles car lease and sale dealership to help you decide.
(Source: Should you buy or lease a new vehicle?, CNN.com)to