Buying vs Leasing a Used Car – Cambridge, Kitchener, Waterloo
How do you make the decision between leasing or buying a vehicle?
To make the car buy vs lease decision is difficult because so many factors are affecting your life right now and cash flow is often the most pressing and demanding factor.
Leasing can often mean your monthly payments are lower, and you only need a low, or no down payment, and those are powerful incentives, but it’s a good idea to look at all the differences between the buying and leasing, to be sure it’s right for you in the long term.
Car leasing is attractive as it can get you a higher-priced, better-equipped, vehicle than you could afford to buy, and often a later model, so it may still have the manufacturer’s warranty. You get to drive the vehicle for the most trouble-free years of its life, then hand it back to the dealer. Then you can either lease a newer car or buy at that point, having saved some money.
By making car loan payments, you are paying off the purchase price of the vehicle, so you have the right to sell, or trade in, your vehicle at any time, and potentially use the money to pay off the loan balance. With leasing, you won’t ever own the vehicle, unless you then decide to buy it at the end of the lease.
The plus side to this is that its future value won’t affect you financially if it has decreased a lot in value. On the negative side, you don’t have any equity in the vehicle, if it increases or holds it’s valued. Most leases limit the number of miles you can drive, and you will have to pay extra if you exceed that limit. You must maintain your leased vehicle in good condition, or you’ll have to pay excess wear-and-tear charges, so watch out for damage by your kids, or from supermarket car parks. If you have to end the lease early, the cost of early termination can almost be as high as the remaining payments would have been for the entire term.
At Garston Motors we can crunch the numbers for a particular vehicle, using both methods, and see how car buy vs lease compare to fit your needs. If you need lower monthly payments but are concerned about some of the other aspects of leasing, then maybe you could consider buying a less expensive used vehicle, or asking for a longer loan term. To save more money we sell vehicles that hold their value, are reliable, and have good fuel efficiency.