Let’s face it, a quality vehicle is expensive and most of us don’t have the cash on hand needed to purchase a car outright. So, if you’re in the market for a new or used car, you might be wondering whether it makes more sense to lease or finance. The answer isn’t clear cut and, for the most part, it depends on you.
What’s the difference between leasing and financing?
When you lease a car, you don’t own the vehicle. You keep it for the length of the contract and pay the monthly fee. When you finance a car, you own the vehicle and make payments to pay back the money you borrowed to purchase it. When your payments are done, you keep the car – but it might also be time for new one.
Who should lease?
Leasing is better suited to some people because they are looking for the lowest possible monthly payment, they like the flexibility of changing their vehicle every couple of years and they have predictable driving habits with an average number of annual kilometres. Those who drive for work or operate their own business might also prefer to lease if they are eligible to claim their lease payments as an expense.
Who should finance?
If you generally keep your vehicle for longer periods of time, take pride in ownership and look forward to being “payment free” one day, leasing probably isn’t for you. Financing also makes sense for those with less predictable driving patterns and a higher number of annual kilometres. Lease contracts usually stipulate the maximum number of annual kilometres that can be driven before financial penalties will apply.
Whether you choose to lease or finance your next car, trust the experts at Clonsilla Auto Sales. We offer the best rates and guaranteed approvals for good and bad credit car loans and leases. We have plans designed to meet the needs of almost everybody.