Car Shopping- Which is better?? Buying or Leasing
Car Shopping have always been tougher and with the world economy going to the downside, having a car is just the brightest thing no matter whether you buy it or lease it. Some shortcomings like mileage restrictions and calculated residual values makes leasing a less charming choice for car shopping but with the today’s changeable economic conditions one thinks its better to lease than to buy.
Art Spinella has rightly said,
“If it’s two or three years, you’re better off leasing, … If it’s longer than three years you’re better off buying.”
So, if you are still in confusion which option to choose check do out our views also.
Get to know the Nuts and Bolts
First you should know the essentials of car leasing; it is more like renting a car but with some terms and conditions.
Price of the car is the first thing you need to work out. You have to bargain it even when you choose to lease.
Money factor or Interest rate is often kept hidden from the consumer, so do check all the issues before signing the deal.
It is the value your vehicle will have at the end of the leasing period. This value is calculated in advance of the leasing term.
Do check the turn- in fees and penalties which will cost you if you don’t take proper care of the vehicle or drive it for a longer period.
Check Out the Benefits and Drawbacks
Everything in the world has its benefits and draw backs, positives and negatives and so does the leasing.
No doubt you enjoy some benefits like you get a chance of driving a new vehicle. You have to pay tax only on the leasing price. You can give the vehicle back to the dealer how much the price of the vehicle has been depreciated during the years. Also sometimes you get a free maintenance of the vehicle
But on the other hand, there are some disadvantages also. You were paying only for driving the car and after the lease period ends you won’t have the car in your hand. Also, sometimes it becomes difficult to pay the money when you are drenched in financial crises.
Watch out for the Economy
Increasing unemployment and changeable economic conditions have left the car shoppers in wonder whether it is better to lease or not. But in these days of unpredictable economy the conditions are in favor of leasing
According to Brian Taylor
“What we might see happen is an increase in leasing, which was not an option for private use in the early 1990s recession, where people can get out of a car and into another one for the same, if not less, monthly payment,”
Almost zero Sales tax
The sales tax you are giving on the lease amount is almost negligible as it is much less than the tax you will pay when you will buy the car. Imagine if you buy a $ 58,000 car with the 8% interest and you have to pay the tax on whole amount your bank account will get empty.
Less Interest Rate
You have to give monthly installments in leasing so interest rate will be automatically lower.
Though the car is new whether you buy it or lease it and maintenance is as such not required however, Most of the lease terms include free maintenance and oil change so, you can save some money.
Deal in your hand
In the end, deal is in your favor as you don’t know what will be the value of car after 2 or 3 years so, you don’t have to worry if the economic conditions are good or bad. At the end of the lease period you will hand back the vehicle to the dealer. However, if you have bought the vehicle you might be in trouble if the economy goes down.
Get the Best!!
Some cars like 2007 BMW 328i and 2008 Mercedes SLK are available with the best lease deals. Also some auto companies like GM are leasing luxury vehicles. People prefer these deals instead of buying the cars. So, whether you are the victim of the bad economic conditions or not, choose what’s the best for you.