Buying Vs Leasing
You may be wondering if you should lease or buy your next vehicle. That’s a great question! Selecting your next vehicle is a large investment and we want you to make the best decision for you. Below we’ve outlined some advantages and disadvantages of Buying Vs Leasing to help.
- Lower Monthly Payments – Monthly lease payments are typically less expensive than purchasing payments.
- Lower Down Payments – Vehicle lease down payments typically require less money upfront.
- Opportunity to Upgrade– Leasing allows you to upgrade your ride every few years, so you’ll always have a new vehicle.
- Business-Friendly– Nearly all leasing expenses used for business purposes can be deducted.
- Short-Term Ownership – At the conclusion of your lease, you do not own your vehicle. (You may be able to purchase it by paying the remaining balance.)
- Early Termination Fees – If you decide to end your lease early, you may face early-termination penalties.
- Mileage Limit – Most leases have a mileage limit of 10,000 - 15,000 miles per year. This limits the amount of driving you can do without incurring mileage penalties at the end of your lease term.
- Maintaining Vehicle Condition – Leased vehicles must be kept in good condition. Interior or exterior damages may result in penalties or fees at the end of your lease term.
- Long-Term Ownership – A key advantage of buying a vehicle is the long-term ownership of your asset. After you've paid off your vehicle, you will not have to continue paying recurring vehicle payments.
- No Mileage Limit – Buying a vehicle gives you the ability to drive as much or as little as you'd like.
- Relaxed Vehicle Condition – If your vehicle has a few scratches, dings, or worn interior, you don’t need to worry about any penalty fees.
- Lower Vehicle Insurance – Buying a vehicle typically has lower annual insurance rates.
- Higher Monthly Payments – Buying a vehicle typically comes with higher monthly payments until the vehicle is paid off.
- Higher Down Payments – Most lenders require a 10-20% down payment of the vehicle, which may be more costly upfront.
- Depreciation of Value – Most new vehicles have an average depreciation of 20.5% after their first year.
- Trading-In/Selling – When it’s time to upgrade your vehicle, you have to go through the work of finding a buyer. Or you may trade-in your current vehicle.
When it comes to buying or leasing, there is not a “one-size-fits-all” answer. Consider your needs, budget, lifestyle, credit, and other requirements before making the decision to lease or buy your next vehicle near Eau Claire, WI. If you have any questions about which option would be best for you, contact our Ken Vance team. We’re happy to go through your options with you.