Which buying option is best for you? When comparing leasing vs buying (through financing), there are many things to consider such as monthly payments, mileage, and more. Learn about Buying vs Leasing and the pros and cons of each.
Leasing VS Financing
When looking at leasing vs buying, take into account the pros and cons for BOTH. The payments and price will vary to suit your different needs, lifestyle, and preferences. Taking all the factors into account will determine which is the best option for you and your wallet. Whether it be leasing or financing our team will get you the best deal. Apart from buying cash, one of the most common car buying options is financing.
The BEST option can be one of the other but is greatly affected by important factors including credit score, income, debt to income ratio, money down, co-signer, the value of your trade-in, and more.
Each person’s situation differs and affects the options in a finance or lease agreement.
Let’s take a look at:
- What is Leasing?
- Leasing
- Pros
- Cons
- What is Financing?
- Financing
- Pros
- Cons
- Leasing vs Buying: Which is Best for You?
Leasing or car buying isn’t what it use to be. With Matt Blatt Dealerships, leasing or buying a car is a transparent process. We tell you your payments upfront and how we got there. Not to mention, we offer a 4 day love it or leave it policy. Going to a reputable dealership makes the world of difference when leasing or buying a car.
What is Leasing?
Now, what is leasing? By definition, a lease is ‘a contract by which one party conveys land, property, services, etc. to another for a specified time, usually in return for a periodic payment.’
Basically, you are renting the car for an agreed upon period of time. Similar to how you rent an apartment. Most of the time, you can only lease new cars. When the lease ends you have 2 options: return the vehicle back to the dealership and get into a new lease or buy the car for the price on the agreement.
How to determine your monthly lease payments? After choosing how long you’ll lease for, your monthly payments are calculated by the difference between the vehicle’s price and its expected value at the end of the lease, plus interest and fees. Check out our payment estimate calculator to help give you an idea of what your payments could look like.
Leasing: The Pros
- New Car Every Few Years: Lease time periods range from 2 years to 4 years. Therefore, you bring the vehicle back with zero negative equity and get into a brand new vehicle every few years.
- More Car for Less Money: For the same vehicle, monthly lease payments are lower compared to buying payments. You get a nicer vehicle for less money per month.
- Flexibility: Not only are you not stuck with the car forever, but you are also able to shift around your term length, monthly payments, and money down to fit your needs.
- Always Under Warranty: The car you lease will always be under warranty due to it being a new car.
- GAP coverage is included: You don’t have to pay for GAP coverage because it’s included with a lease.
- Option to Buy: At the end of your lease, you have the option to purchase the vehicle instead of returning it.
- Building Credit: Every monthly payment is continuously building your credit score.
- Great Deals: Each month, different lease deals and incentives are available. Keep an eye out for the right one for you.
Leasing: The Cons
- Mileage Restrictions: With a lease, you are limited to the number of miles you can drive without having to pay extra. Usually, the miles are from 10,000 to 20,000 a year.
- Always a Payment: Every month you will have a payment to make.
- Driving Caution: The coverage and warranty cover the normal wear and tear. You pay for any extra damage at the end of the lease.
What is Financing?
Financing has previously been a very popular car buying option before transparency and affordable options for lease deals.
Financing is ‘providing funding for a person or enterprise.’ So you’re buying the car on a loan. You will have monthly payments for a set period of time and after your car will be fully paid off.
Dealerships tend to have very good loan options because of their strong relationships with banks. But if you’d like you can opt for direct lending and find your own financing. You and your sales representative will find a loan option that fits your situation!
Financing: The Pros
- Paying to Own: You are building equity in the car. You will own the title and car at the end.
- Don’t Worry About Miles: Being as you are going to own the car, there are no mileage limits. Drive as far as you want.
- New or Used: You can finance a new OR used car. And with Matt Blatt’s large inventory of quality pre-owned cars, this is a great option to have.
- Lots of Incentives: The manufacturer usually has continuously changing incentive deals available. If you are looking to finance, keeping an eye on the changing monthly incentives to more save money.
- Trade-In: Having a trade in can lower your payments and be part of your payments toward owning the car. Value your trade here.
Financing: The Cons
- Warranty: Your warranty will run out after a few years and you’ll have to purchase one or go without one and risk a loss.
- Don’t Officially Own: Until the vehicle is paid in full, you don’t officially own the vehicle.
- Higher Payments: The monthly payments usually are higher.
Leasing vs Buying: Which Is Best For You?
In conclusion, when comparing leasing vs buying, there are many things to consider. As a result, it comes down to your situation. Each person is in a different position and will have different choices available to them.
The best option is to speak with a sales representative at a reputable and honest car place to get the best lease and car buying deals.
Our team is here if you have any questions!
And we guarantee, Matt Blatt Dealerships will take care of you!
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