There is always a pro and con to everything and we would like to bring forth the good, the bad, and the ugly of leasing a car. There are many immediate payoffs to leasing a car, but in the long-run you might realize that it isn’t a right fit for you and your financial status. You will soon find there is actually more downsides to leasing than benefits to leasing. If you are able to afford the luxury of switching out your car every two-three years, then go for it and lease your next car. But if this is not a reality yet, maybe you should take the following into consideration.
Benefits of a Lease
The immediate benefits you will see when leasing a car is the monthly payment. When leasing a car, you will have a lower monthly payment than when purchasing the car. You also might not be able to afford a brand-new car, but leasing is an opportunity to drive in style on a budget. Most people also gravitate towards leasing because you can have a new car every two to three years with ease. You will be able to switch it up without getting bored of what you are driving.
Darkside of a Lease
There is always a downside behind every bright side. Behind what they advertise to pull you to lease a car, there is always hidden details and costs in the contract for a new lease car. Dealers pull you in with a lower cost but in order to get it you must have a very high credit score. Instead of paying every month to ownership of the vehicle, you are actually just paying monthly to drive a car that is not yours. If you can afford paying from $100-150 more, you can one day own a car rather than always paying monthly for essentially nothing.
Another option would be to lease-to-buy. While you wait for financial status to improve, you can have the first 3 years with a lower monthly payment and then complete the payments to own the car. The money you put towards the first three years would not go to waste, and if you decide not to buy it, you can return it. This is a great option if you want to try a car that you would like to someday own.
Another Con for Leasing
Another downside of leasing is depending on how much you drive and commute to your workspace, there is also a limit on that for a leased car. Depending on the car and dealer this varies, but if you go over the amount of mileage given you are charged extra. The total mileage is calculated as the number of years leased multiplied by the annual miles allowed. The extra cost is between 15-30 cents per mile, accumulating up to five dollars a day. This adds an additional step of consideration when deciding on whether to buy or to lease. When you buy, you have unlimited mileage and freedom to drive wherever you want, but with a lease you must calculate and take inconsideration every trip you take. In addition to being limiting the mileage, there is also a limit to where you can travel with your leased car. You cannot have a road trip to another country without leaser’s permission (if they give you one at all).
In the end depending on your status and preference the decision is yours. We know how important choosing a car is and this next decision is no small one. We hope this article from Newport Motors helped weigh your decision on whether to lease a car or not.