Is It Better To Buy Or Lease A New Car?

Unfortunately, the mostly car manufactures don’t encourage the leasing of vehicles to private customers. However, they had a thought that it was for only companies & fleets. With the passage of time & innovations, this has significantly changed. Now they encourage the leasing of vehicles for private individuals rather buying a car outright.

The youthful working population isn’t keen on spend their all savings for the down payment of the vehicle. They don’t avoid EMIs however would prefer not to be secured with ownership. The leasing model fulfils their all needs.

In-car leasing option, you can enjoy the luxury vehicles by paying fixed monthly rent without any hassle of any down payment. Although, you don’t need to worry about the resale of the vehicle, in case if you want to switch to another model. This is the best part of the leasing scheme. The maximum leasing tenure period is of around five years and the minimum is lock-in period is 2 years.

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Let’s glimpse over the upside & downside of leasing Scheme

Pocket-friendly!! The rent is much lower than EMI

The most importantly it saves the maintenance and insurance

You can switch to another model after 2 to 3 years like a piece of cake

In case, you end the lease prematurely you need to pay a stiff penalty.

The Monthly Rent for shorter period costs an arm & a leg

At the end of tenure, you don’t own the vehicle’s ownership.

The obvious, downside of the vehicle is that you don’t have ownership & tittle right over the vehicle. Simply, it means that you can’t do any modifications in the vehicle as per your needs. Lastly, you have to give this back to its owner as of the original. However, for the majority of people, the leasing opportunity is literally much fruitful that outweighs the issue of ownership possession of the vehicle. Shortly, one can say a leasing scheme is a double-edged sword.

The decision to lease or buy the vehicle can be stem from the above distinction easily.

Buying a vehicle has also enormous benefits over leasing the car. Whereas in leasing, there is a fixed limit in mileage cover and you need to purchase additional mileage and the costing of mileage will be in the lease agreement. No modifications in the vehicle are much more restrictions on it!! People who don’t have enough budgets to afford luxury vehicles and change it as per the trend, they always go for leasing.

The ownership possession of vehicle helps you to sell the vehicle after using 3 to 4 years. Moreover, you have the flexibility to pay off the loan at any time. You are no longer in the lock-in period of ownership in case of buying a vehicle. If you belong to Western Australia, you must check cash for cars Perth for any unwanted vehicle. 

The flexibility of clocking mileage as per your need is the best part of buying an own vehicle. Leasing an put the limit on mileage cover, in case you exceed the limit you need to pay off extra for it.

Undoubtedly, the monthly leasing cost is less costly than the down payment of car loan. However, you can build equity for the future when you decide to trade-in it with each loan payment. Purchasing a vehicle and drive it for several years after paying off is the cheap & affordable way.

Contingent upon the vehicle, 20% to 40% of its devaluation can happen inside the initial barely any years. So, when you purchase a 2-to 3-year-old-vehicle, you get the upside of addressing a cost that mirrors a considerable devaluation rebate.

In case, you want to accessorize your vehicle you are flexible to do this, unlike leasing scheme.

Lastly, the decision is up to you either you choose leasing or buying, make sure choose it wisely. It should be noted that you have to choose it as per your requirement and budget. But leasing is much cheaper as compared to buying a vehicle from a costing perspective.

Oscar Main is Freelancer Writer, with extensive experience in writing in the Automotive industry for decades. So, I have explained all the pros & cons of leasing & buying above.