Every time we mention leasing vs financing, it’s as if we are about to engage in the battle of the century. In one corner there are those that believe in leasing, usually the type to change cars very often, and in the other corner there are those who prefer to buy their vehicle outright, and not owe anything to anyone. At least, once the vehicle is paid off.
Try as you might, it’s hard to convince one party of the benefits of the other alternative. That is to be expected given that both solutions have their advantages and disadvantages. “The right answer will depend on your situation, and your specific needs,” says sales consultant at Morrey Mazda.
Those that prefer leasing will often state the fact that the monthly cost will be lower, not to mention that leasing gives them more flexibility and the ability to change cars more often since leases are generally of shorter duration. It is even possible to lease for 24 months. And because the payment is lower, you can often get more car for the same price.
Of course, you do not own the car outright. That means that at the end of the lease you either have to buy it back or give it back. Should you decide to ultimately buy it back, you will generally come out on the losing side financially compared to buying it outright from the start. Also, you have mileage restrictions in a leased vehicle, and any damages will need to be repaired before you bring the vehicle back.
Financing your new vehicle also has its advantages, in particular for those who want to keep their cars longer. Yes, the monthly payment is higher, but your car will be yours at the end of the financing period. So you can keep it without a monthly payment afterwards, or simply sell it and get a new one. It can also be used as collateral if you need other loans.
So leasing or financing? There is no right answer. Your situation and your situation alone should dictate your choice.