Should I Finance or Lease My New Car?

Should I Finance or Lease My New Car?

Posted on June 26, 2017

When purchasing a new vehicle, there are many important things to consider. Regardless of which make and model you select, one of the most important elements to consider is whether you should lease or finance the vehicle. Few people have the ability to purchase a car simply with their own pocket money, so taking out some kind of loan is necessary to get a new car. Leasing and financing share several broad similarities, but also differ greatly in many areas. Depending on your situation, either one or the other might be more appropriate for you.
 
When you finance a vehicle, you spread the entire cost of the vehicle out over a defined payment term. The longer the term, the smaller your payments will be. Depending on many factors – for example the make and model, whether you purchase new or used, and your credit situation, your interest rate may vary. The benefit of financing your new vehicle is that you will own the vehicle outright once you have made all the payments. Vehicles are lasting longer than ever, and so long as you perform regular maintenance, you will be able to enjoy your car, payment free, for many years to come. You also have the option to modify your vehicle, for example adding a lift kit to a pickup truck, or a modified exhaust to a sports car, if you finance it, whereas this is not an option when you lease a vehicle.
 
When you lease a vehicle, you only pay for what you use. Lease payments are based on the number of years you plan to drive the vehicle for, and the number of kilometers you plan to drive. Payment terms are more flexible when you lease, and provide you with the opportunity to get into a new vehicle every few years. Because leasing generally offers smaller monthly payments, you will likely be able to afford a “nicer” car with more of the features that you desire. Both upfront costs and monthly payments tend to be lower for a lease because you only pay for what you use. When leasing a brand new vehicle, you benefit from warranty protection which can drastically reduce your vehicle maintenance costs. When it comes to the end of your lease term, you have the option of either returning the vehicle to the dealer, or buying out the car either by paying cash or financing the remaining balance.
 
Here at Bustard Chrysler in Waterloo, we offer both financing and lease options. If you have any questions as to which might be better for you situation, or would like more information, we would be happy to help! You can email us at teamdigital@bustard.com or give us a ring at (855) 273-2507.