What Are the Advantages and Benefits of Car Leasing
When it comes to car leasing, there are advantages and benefits to leasing a car compared to buying a car. You have to decide whether leasing a car is more suitable to your needs as opposed to financing a car, keeping the vehicle, and saving money over the long term. There are people who are completely against the idea of car leasing and that’s fine, but there are several advantages to car leasing that favors certain people.
Lower Monthly Payments
This is most obvious reason why car leasing is more advantageous than buying a car. Monthly payments is nearly guaranteed to be lower on a car lease than purchasing a car because you only pay for the portion of the vehicle that you use.
Drive a Brand New Car Every Three Years
This is the reason why I lease a car. I get bored of driving the same car. The benefits to driving a brand new car every three years or so is that you take advantage of the latest in safety, fuel economy, redesign/refreshes of the make and model, and performance advancements.
Get into a More Expensive Car
Due to the lower monthly payments, you will be able to get into a more expensive car.
Car Manufacturer Warranty is Covered During Lease Period
The most common car lease period is 36 or 39 months and the car manufacturer warranty is usually covered during this lease period.
Low Upfront Costs and Very Little to No Down Payments
It is always recommended to put as little down as possible when leasing a car because if your leased car gets totaled in an accident, you lose your down payment. You never know what’s going to happen so it’s best to put down as little or no down when leasing a car and yes, that means your monthly payment will increase. Don’t be fooled by all the car ads that advertise low monthly payments with a $2499 down payment. In all my years of leasing, I’ve either had $0 due at signing and everything rolled into the lease OR just the usual first month’s payment, tax, title, and registration.
Monthly Payments and Interest Rates Remain Constant
Leasing a car guarantees that the interest rate does not change and the monthly payments remains the same throughout the life of the lease agreement.
Simple and Easy End of Year Lease Options
The most common end of year lease option for most lessees will be to simply turn in the car at the end of the car lease agreement. You also have the option of keeping the vehicle and financing the car as if you were buying the car or you can trade it in by selling it to a third party and pocketing the difference if there’s positive equity on your vehicle. If there’s negative equity, then you simply turn in the vehicle and walk away.
Gap Coverage Is Included
Gap coverage, in case your vehicle gets totaled or stolen, is included in most leases as a way to protect yourself if your insurance doesn’t cover the full loss. Loans generally do not come with gap insurance.