Buying or leasing a vehicle – Which is the best option?

 

Buying Or Leasing Your First Vehicle?

Purchasing a new or used vehicle is one of the necessary expenses which we face. If you find it too daunting to save money to buy a vehicle, you can consider vehicle leasing. But not everyone can consider leasing a car.

Know that leases are usually cheaper for the short term but when it is for the long run, buy a car to save money. Weighing the pros and cons of buying and leasing a car will help you make the right decision for you and your family.

What's the significant difference between buying and leasing a car?

Leasing a vehicle is a contract whereby one party permits another party to use the vehicle for a specific period in exchange for periodic payments like monthly instalments. If your agreement has the option to purchase the car at the end of the contract, then you can carry it out.

So, what's the difference between financing and leasing a car? You are purchasing a car with the loan, but you are also paying monthly payments to the finance company or lender. But at the end of this process, you will own your dream car.

Pros of leasing a car:

1.      Lower monthly instalments – Here, you are not applying for a loan. Thus, you don't need to worry about the interest rate to be paid. You will be simply liable to pay a monthly fee based on the service provider. It's also lesser when compared to the EMI.

1.      Return the car at the end of the contract - People who wish to keep a vehicle for a short period of time can take out a lease to pay until they own it.

1.      Worry-free maintenance – The dealer will take care of the maintenance and repair work of the car. You don't need to carry out periodic maintenance, which means you can save more money.

Pros of buying a car:

1.      Enjoy ownership – If you buy the car, you can enjoy the joy of being the owner of the vehicle. It will be satisfying and will give you a new experience.

1.      Warranty - If you purchase the vehicle, it will be covered under warranty for a short time. Hence, you will not need to pay for all the repairs within this period and make your pocket empty.

1.      Payment – Though if you buy a car with finance and pay higher interest when compared to the leasing, by the end, you will be the vehicle owner. Hence, it's full of value. You can carry out a vehicle check to get a comprehensive report of your vehicle and understand its current condition.

Thus, based on your financial condition and lifestyle, you can choose whether you want to lease or purchase a vehicle.