Your New Vehicle: Buying Vs. Leasing By Brenda Williams At Isnare.com Ezine Articles

When shopping for a new vehicle there are a variety of options available. In some cases, it is seen as cheaper to lease a new vehicle than to purchase one outright, or by using a payment plan. Experts recommend leasing to those that like to upgrade their vehicle at the end of the term. Did you know that the leasing payments essentially pay for the depreciation of the vehicle that will come at the end of the term?

With a new vehicle lasting on average six years, combined with the fact that you never get the money that was initially invested into the vehicle – many experts advocate leasing. Leasing is a way to offset the costs of replacing the vehicle, using payments to borrow the vehicle for a long period of time.

The benefits of leasing can be seen in the lower monthly payments. Did you know that leasing costs as much as thirty to sixty percent less than paying a monthly premium on a vehicle loan? With these lower monthly payments, comes the option of having a new vehicle, more often than purchasing a new vehicle. After all, you are going to make the car payments anyway – why not have a new vehicle every to two five years while paying lower monthly payments.

Monthly payments aren’t the only way to save money on a leased vehicle. Sales tax amounts are lower on a leased vehicle than on a vehicle that has been purchased outright, or a vehicle that is being funded through a financing plan. The down payment that comes with the cost of leasing is often much lower than what comes with the purchase of a new vehicle. A percentage of the down payment that is required through the purchase of a vehicle is higher than with leasing, as much as ten percent higher.

Leasing a vehicle is essentially renting the vehicle for an extended period of time. How does the leasing process work? First, the customer decides how long the period will be in which they decide to lease the vehicle, usually, a period of two to five years.

When choosing to lease a vehicle, there are certain contractual obligations that come with the agreement. First, the vehicle must be under a certain amount of mileage when traded. If not, than penalties may exist for each mile in which the vehicle is over. Second, the vehicle must be in good condition – inside, outside and throughout the components of the engine. If these conditions are not met than the lessee of the vehicle is expected to pay certain penalties that come with the contract.

So, with the many benefits that come with leasing – what are the benefits that come with the purchase of a vehicle? When purchasing a new vehicle, it comes with a warranty. Many of the costs that come with the wear and tear of a vehicle are not covered while leasing – while buying a vehicle, these costs are often covered. Combine this with the benefit of the profits that stand to be earned when the vehicle is sold – and buying may be another option to consider. If you are in the market for a new vehicle, compare both choices and find which one suit you best.

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