Your Next Car: Buy or Lease?

Real Estate

Your Next Car: Buy or Lease?

Pros and Cons of leasing:

l Small or no down payment

l Lower monthly payments (even compared to 0 percent loan)

l A warranty for the life of the lease

l Driving more car than you could afford to buy

l Brand-new car every 2-5 years

l You pay for only a portion of the vehicle's cost

Cons of leasing:

l Limited mileage

l You’ll never actually own the car

l Permanent monthly payment

l Penalties for turning the car in early, undue wear and tear, going over the pre-specified mileage limit

Pros of buying:

l One day, it’ll be yours, all yours

l No limit to mileage

l End to payments

l Lower auto insurance cost

Cons of buying:

l Long-term cost of buying a car is less than leasing

l Less complicated than leasing

l A portion of every payment you make is lost to depreciation

l Good-sized down payment

l You pay for the entire cost of a vehicle, regardless of how many miles you drive