Leasing Versus Buying a New Vehicle: What’s Your Best Option?
When you visit Heritage Mazda Bel Air, Catonsville & Towson looking for a new vehicle, you’ll have two different options for taking home the car of your choice: leasing or buying. There are advantages to both options, so here are some tips for choosing the best option to meet your needs.
Buying:
According to a study by market research firm Polk, the average car ownership period is roughly six years. In this scenario, the average owner would require two lease cycles of three years each or one five-year finance period with no car payments at all. At the end of the lease cycle, you still do not own the car and must start a new lease cycle, with new payments, or purchase the vehicle. If you purchase the vehicle to begin with, you own the vehicle and its residual value at the end of the finance period. Also, by financing a new vehicle, you’ll generally pay less for auto insurance.
Perhaps the biggest advantage of buying a car is the pride of ownership. It’s hard to put a value on it, but consider your ability to modify the vehicle however you choose without violating your lease terms, and as well as the fact that wear and tear on the vehicle, including excessive mileage, isn't as big a deal as it would be with a leased vehicle—Leasing typically limits the driver to 10,000-12,000 miles per year. After that, you’d have to pay a per mile fee as a lessee. Finally, and perhaps most importantly, when you own a vehicle, you can sell it whenever you choose without having to wait for a lease term to end.
Leasing:
One of the major advantages of leasing is short-term financial flexibility. When you lease a vehicle, you’re given the option to purchase the vehicle at the end of your lease term for a preset price, with the finance company setting the purchase price of the vehicle at the beginning of the lease term. This works in your favor because if the market value of the vehicle depreciates excessively over the lease period, you can simply turn in the vehicle at the end of your lease and you don’t have to worry about resale. However, if the vehicle holds its value well over the lease period, you’re able to purchase it for the pre-set bargain price.
Other advantages of leasing a new car include avoiding the expenses of repairs and maintenance; a yearly tax deduction for leased business vehicles; the prestige of driving a new vehicle more often; enjoyment of the latest safety, technology, and comfort features; and the security of being continually within the manufacturer’s bumper-to-bumper warranty.
Regardless of which option you choose—buying or leasing—you should first weigh all of the benefits and disadvantages, and figure out what works best for you. If you’re having trouble deciding, Heritage Mazda Bel Air, Catonsville & Towson will be standing by to give you whatever information you might need. Call, contact us online, or stop by today to discuss your options and check out our selection of new vehicles.