Leasing or purchasing your next car or another vehicle, which one is better for you?
When you buy or purchase a car, you pay for the entire cost of a vehicle, regardless of how many miles you drive it or how long you keep it. Monthly payments are higher for purchasing a car or vehicle than they are for leasing that same car or vehicle. You typically make a down payment, pay sales taxes in cash or roll them into your loan, and pay an interest rate determined by your loan company based on your credit score. You make your first payment a month after you sign your contract. Later, you may decide to sell or trade the vehicle for its depreciated resale or trade value.
When you lease a car or vehicle, you pay only a portion of a vehicle’s cost, which is the part that you “use up” during the time you’re driving it. Leasing is a form of financing and is not the same as renting. You have the option of not making a down payment, you pay sales tax only on your monthly payments (in most states), and you pay a financial rate, called money factor, that is similar to the interest on a loan. You may also be required to pay fees and possibly a security deposit that you don’t pay when you buy or purchase a vehicle. You make your first payment at the time you sign your contract - for the month ahead. At lease-end, you may either return the vehicle or purchase it for its depreciated resale value. In some cases, you may be charged a lease-end disposition fee at the end of the lease.
If you have any specific questions if leasing or buying is right for you, please call us at 718-975-9000, and we will be happy to help you decide whether to purchase or lease a car or any other vehicle.
