Leasing or Buying a Car

Tips when you want to Buy a Car or Lease a Car.

When it comes to get a new or used car, deciding whether leasing or buying is best is a personal decision. When you compare both options, you see that they each have their pros and cons. To decide what you should do when you get your next car, here are some things you should take into consideration.

Decide how long you want to keep the car. When you lease, you do not own the car you just rent it for a specific term and then turn it back in. Buying allows you to keep the car as long as you want.

Evaluate how much you can afford to pay upfront. Buying a car often has more upfront costs including the first month's payment, down payment, a security deposit and other fees. When you lease a car you don't have to pay the first monthly payment until the next month and you may not have to pay a down payment.

Compare how much mileage you typically use per year vs. leasing options. Car leases allow for a predetermined number of miles per year and if you exceed that amount, you will have to pay a fee per mile. If you put a lot of miles on a car, buying is a better option.

Determine how much you can afford to pay monthly. Car leasing usually provides significant savings in this department when you compare it vs. buying. Essentially you only pay for the amount of depreciation on the car for the time that you have it plus financing charges.

Compare the end of term procedures for leasing vs. buying. Leasing allows you to turn in the keys of the car and walk away at the end of the term. To get rid of a car you bought you have to either sell it or trade it in.

Check the maintenance record for the car you are considering. It's often easier to lease cars that require a lot of repairs because most leasing contracts cover these costs. Once the manufacturer's warranty expires on a bought car, you have to either buy an extended warranty or pay the repair costs.