When looking to get a car, one of the most important things that you will need to consider is whether to finance it or get a lease. Both of these options both have their advantages and disadvantages. As a result, it will be important for consumers to evaluate their needs as well as how the advantages and disadvantages of each option pertain to them.
Here are the pros of leasing a vehicle:
1. Lower Monthly Payments
One of the main pros of leasing a car is that the monthly payment will be lower. Since you are not financing the car, you will be responsible for an amount that is quite affordable.
2. Free Maintenance
Another one of the leasing benefits is free maintenance. You will be able to get car maintenance without any additional cost. As a result, you will be able to save a lot of money with car maintenance when you lease a car.
3. Get a New Vehicle More Often
When looking to lease a car, you will be able to get a new car every three years. If you are someone who enjoys driving in a new vehicle within a short period of time, then leasing is the better option.
4. Lower Upfront Costs
When it comes to leasing benefits, lower up front costs is one of the most advantageous. A consumer who leases a car will just have to put a small amount of money down and then begin making payments. With lower upfront costs, consumers will have an easier time getting a new vehicle.
Here are the negatives associated with leasing a vehicle:
1. No Equity
While leasing a vehicle has its pros and benefits, there are some cons as well. One of the main cons of leasing a car is that there is no equity. When you lease a car, you will not have any resale value. As a result, buying a new vehicle can be difficult.
2. Mileage Limits
Leasing a car also has mileage limits as well. A lease agreement will usually allow you to drive the car for up to 10,000 miles per year. While this is sufficient for most consumers, it can be quite limiting to those who need to drive a vehicle more frequently.
3. No Trade in Value
Another con of leasing a car is that it has no trade in value. If you are looking to buy a car, you will not be able to use a vehicle as part of your down payment. As a result, this can make many high quality cars unaffordable.
There are also pros and cons linked to financing a new truck, car, or SVU, including:
1. Full Ownership
When financing a car, you will get full ownership in which you can drive the car as much as you want.
2. Equity
Financing a car gives you equity so that you will have resale value when it’s time to get a new car.
3. Trade in Value
Cars that are financed also provide trade in value where you can use this car as part of your down payment on another one. This will help reduce out of pocket costs.
4. No Mileage Restrictions
There are no restrictions on how much you can drive a car when you finance it.
5. More Out of Pocket Costs
When financing a car one of the cons is that there are higher out of pocket costs which include the down payment.
6. Responsible for Maintenance
You are fully responsible for the maintenance after the warranty expires when you finance a car.
7. Limited Warranty
Financed cars have a warranty that is valid for a certain period of time ranging from 3 to 5 years or 36,000 to 50,000 miles.
