Advantages to Auto Leasing vs Buying
At Capital Chevrolet, we understand that the choices between buying and leasing a car can be overwhelming and confusing. To assist you in making an informed decision, we've outlined the key differences between buying and leasing a vehicle. We hope you find this information both informative and helpful.
Buying a Car
When you choose to buy a new or used car from Capital Chevrolet, you are paying for the entire cost of the vehicle. This means:
- Long-term Cost Savings: Although the initial costs of buying a car can be higher than leasing, owning a car can be more economical in the long run. Without monthly lease payments and end-of-lease fees, you can save money over the vehicle's lifespan.
- Equity: As you pay down your loan, you build equity in the vehicle, which you can use as a trade-in value or sell privately in the future.
- Unlimited Mileage: You can drive as much as you want without worrying about mileage limits or extra fees.
- Customization: You are free to modify and customize your car as you see fit.
Leasing a Car
Leasing a new or used car from Capital Chevrolet means you are paying for only a portion of the vehicle's cost. Specifically, you pay for the part of the car's value that you use during the lease term. This option offers several benefits:
- Lower Monthly Payments: Because you’re only paying for the car’s depreciation during the lease period, your monthly payments are typically lower than if you were buying.
- Newer Models: Leasing allows you to drive a newer model car with the latest technology and features every few years.
- Maintenance: Many lease agreements include maintenance packages, reducing the cost and hassle of repairs.
- Flexibility: At the end of the lease term, you have the option to return the car, lease a new one, or sometimes buy the car at its residual value.
Deciding whether to buy or lease depends on your personal preferences, financial situation, and driving habits. If you enjoy driving the latest models and prefer lower monthly payments, leasing might be the better option for you. On the other hand, if you value long-term ownership and want to build equity in your vehicle, buying could be the more advantageous choice.
At Capital Chevrolet, our team is here to help you navigate these options and find the best fit for your needs. Visit us today to explore our wide selection of new and used cars, and speak with our knowledgeable staff to learn more about our financing and leasing options.
Buying
Who Owns It?
Whether you pay for the car with cash, or finance it and make monthly payments, either way it's yours. Of course, if you're financing it, you'll have to meet the obligations the lender requires, like a certain down payment amount and timely monthly payments. If you don't, they have the right to repossess it.
What Are The Up-Front Costs?
If you're financing it, the bank will probably request a down payment. You can also trade-in another vehicle and use any equity towards your down payment. The amount of the down payment is usually based on the lender's requirements and your credit score.
Will the Car Have A Future Value?
Your vehicle will be worth whatever you can sell it for in the future and that depends on how well you maintain it. (Be smart and protect your investment with regular scheduled maintenance by a factory-authorized facility!)
What Happens At The End of Payments?
Once you've paid off what you owe on your contract, that's it. Your vehicle is 100% yours. The lending institution will send you a Lien Release as proof that the vehicle is completely paid off and all yours.
Leasing
Who Owns It?
You do not own the car when you lease. You're paying for the use of the vehicle, but the finance institution that you leased it through actually owns it. This is usually why you pay less per month in a lease than if you were to buy the car.
What Are The Up-Front Costs?
Leases often do not require any type of a down payment. All you usually have to pay is the first month's payment, a security deposit, the acquisition fee and other fees and taxes. But, as with a purchase, if you want to lower your monthly payments you can always pay more upfront.
Will the Car Have A Future Value?
In most leases you don't end up owning it so you don't end up selling it. That's the financial institution's job. Although you may have mileage limits and wear and tear guidelines that, if you exceed them, could cost you extra money when you turn your vehicle back in.
What Happens At The End of Payments?
Most people return the vehicle at the end of the lease term. But some like to purchase it during their lease or at the end. Others like to trade it in before their lease is over. Just ask us about these different options before signing any paperwork and we'll make sure you have your lease set up the way you want it.
What Are The Best Cars To Lease?
The best cars to lease are those with the best book value after the term of the lease. Since they depreciate less, you pay less. Review the lease ratings to see which cars retain their value.