Very often, when purchasing a new car, people are faced with the
decision of whether to lease or buy their next vehicle. They will
automatically ask themselves the question is car leasing better than buying?
The answer? Well, its very subjective and is really down to the specific needs of the individual making the purchase.
Essentially, they are two different methods of financing your next
car purchase a loan will finance the purchase of the vehicle, whereas
leasing will finance the use of it deciding which option to take will
depend on a number of factors do you want a new car every 2/3 years
with low repair and maintenance risk? Would you prefer full ownership
and a long term saving over low monthly payments?
To help you fully understand the difference if you are to buy a
car, you pay for the full cost regardless of how many miles you will
drive in it. Generally, a car buyer would make a down payment and then
cover the rest of the value and additional costs incurred via a long
term loan. The car is then yours to do with as you please sell it at
a later date or part exchange it at its depreciated value.
If you are to lease a car, you are paying for a fraction of the cars
value that which you will use during the term of the lease. At the
end of this, you may return the vehicle with no obligation to buy.
The best way to think about it is this the short term cost of
leasing is generally less than that of buying whilst the long term cost
of buying is less than that of leasing. After that, its more than
likely to be a question of full time ownership vs a new car every 2/3
years. In any case, there is no definitive answer to suggest which one
is best, thats entirely up to you, but be sure to fully understand the
difference before making your decision.
