Have you ever thought about leasing your next car? If the thought has crossed your mind, here are a few pros and cons of leasing a car.
Pro: Lower monthly payments
Generally, lease payments are lower than car payments and if you’re used to having a payment, this probably sounds great to you.
Con: No equity
When you sign a lease, you’ll have to make payments over a defined period of time. When that time is up, the car goes back to the dealer. At this point, you’ll have a decision to make. You can either enter into a new lease or you’ll have to buy the car.
Pro: Repairs are usually covered
Since you’ll only have a leased car for a handful of years, it will more than likely be covered by a factory warranty. This will save you from having to shell out big bucks for repairs while you have the car.
Con: Mileage limit
How many miles do you drive each year? If you drive over 10-12k miles a year, you’ll probably face some sort of penalty fee at the end of your lease term. Be mindful of this, because those extra miles can really add up.
Pro: A new car every few years
If you’re serial leaser, you probably love driving a new car. This is a definite advantage of leasing over buying. Buying and selling cars can be a hassle, so if you love driving new cars, leasing can be a great option for you.
Con: Fees for damages
When you turn in your car at the end of your lease term, the dealership is going to want to sell it. If there are any dents or scratches to be repaired, you may want to get them taken care of before you turn in the car. A little ding in the door isn’t a big deal if it’s your car, but with a lease, you’ll probably have to pay a fee to get it repaired.
Leasing isn’t for everyone. There are definitely advantages and disadvantages to leasing vehicles. Do your homework and decide what is the best option for you.
Have you leased a vehicle and you’ve gone over your miles or excessive wear and tear? First Financial can help you buy out your lease and help you save! With our Lease Buy Out Program, you aren’t stuck with a big lump sum payment. We’ll help you keep that car you love.* Get started today.
*Not all applicants will qualify, subject to credit approval. Not all applicants will yield savings examples advertised. Additional terms & conditions may apply. Actual rate may vary based on credit worthiness and term. See credit union for details. A First Financial membership is required to obtain an auto loan and is open to anyone who lives, works, worships, volunteers, or attends school in Monmouth or Ocean Counties NJ. A $5 deposit in a base savings account is required for credit union membership prior to opening any other account/loan. Federally insured by NCUA.
Article Source: John Pettit for CUInsight.com