Buying vs Leasing Your Next Car

Buying vs Leasing Your Next Car

Brought to you by the Finance Department at Cuero Chrysler Dodge Jeep Ram

Quick, what's the better option? Love or money? Vacationing in the mountains or at the beach? Leasing or buying a car? All good questions, but we aren't in a position to provide very good advice on the first two. The last one is a bit easier for us since we are car dealers and that's what we do. So, let's discuss buying and leasing, and perhaps you can get a good conversation going on the first two with some good friends. Just make sure to practice social distancing!

Exactly what is leasing?

What does it mean to lease a vehicle? In very simple terms, leasing comes down to paying a fraction of a vehicle's worth at signing (the down payment) then paying off the depreciation that occurs once your drive it through monthly payments. The key concept here is that you do not actually own the vehicle. In fact, it's more like you "rent" it. Why? Because at the end of the lease period, the car goes back to the leasing company. (In some cases, you may have an option to buy it from leasing company at the end of the lease, it depends on your leasing contract.)

How does that differ from buying a car (with financing)?

Well, like most things, buying a vehicle means it becomes your property, unlike leasing where you return it. However, since cars are expensive, most people finance them. Similar to leasing, there will be a down payment followed by monthly payments. However, unlike leasing, the financing will cover the entire cost of the vehicle instead of just the depreciation, and once all payments have been made the title officially becomes yours.

Why do people lease cars?

Well, there several good reasons. For instance, "money." The moneys involved will generally be less when leasing because you're not paying off the whole car. This comes in the form of lower monthly rates, a lower down payment, and lower taxes. And, as long as you stay within the mileage constraints set when you signed your lease, you're going to stay within the manufacturer's warranty for the length of your lease. 

So, why do people buy cars?

The biggest issue for most people when it comes to buying a car is the fact that you would actually own it. And with ownership comes perks that a lease just can't accommodate. Some of these perks include not having mileage restrictions the way leases do, customization possibilities that aren't possible with a lease, and a finite number of payments since once you pay it off it's yours to do as you please.
Additionally, a car you've bought can be used to supplement your next car purchase as a trade-in, which you can also do whenever you please unlike a lease that basically has a return date attached.

So, should you lease or buy?

Well, that's still ultimately up to you. You should take into account how much you have to spend and how long you hope you have the vehicle you're interested in.  By all means, feel free to contact our finance department at Cuero Chrysler Dodge Jeep Ram for more information about buying vs leasing your next car. We arrange the financing on hundreds of cars per year so we can help you weigh the options that each avenue offers so you'll be able to find the one that makes the most sense for you.

Make an Inquiry

By submitting your contact information, you consent to be contacted by telephone about purchasing a vehicle or obtaining vehicle financing. Clicking on the Submit button above is your electronic signature.