Pros & Cons of Buying vs. Leasing a Vehicle
With uncertain times comes the habit of overthinking every single decision you make in life. Bringing a new vehicle into your life is no exception. In fact, this is one of the biggest decisions you must make throughout your adult life. It’s said that Americans spend an average of 18 DAYS in their car each year. Therefore, you want to love where you spend so much of your time. Finding the right vehicle for you is one thing but deciding whether to lease or buy your vehicle is another. Check out our list of pros & cons for both buying & leasing a vehicle.
Buying a Vehicle
- You end up owning the vehicle, which means you’ll have it for the rest of its life or for as long as you would like it. Not only can this offer a sense of security, but it also offers a sense of pride. In the long run, owning something that you’ve put a lot of your hard-earned cash towards is a feeling like no other.
- The up-front costs actually end up being a tad simpler than they would be with leasing. While leasing can have a few add-ons you may not have thought of before, up-front costs for buying a vehicle would include: the cash price or a down payment, taxes, registration, and other fees.
- Another thing about buying a vehicle that adds a sense of security is the fact that you can sell or trade your vehicle in at any time. Plus, you can even use any money from the sale to pay off the loan balance. This isn’t the case with leasing.
- Although it can be thought of a con since your vehicle will lose value with depreciation, the cash value ends up being yours to use how you like.
- Unlike when you lease a car, you won’t have to stress about putting miles on your vehicle since there is no limit when you own it. However, putting more miles on your vehicle causes it to depreciate quicker.
- You also won’t have to stress about any wear & tear put on your vehicle. Accidents happen inside & outside of the vehicle, but when you own it, you won’t be penalized for it in the end.
- One of the best parts about owning something is that you can really make it your own. With a large variety of packages & accessories offered for vehicles, it’s hard to say no to customizing your own.
- The very best part about buying a vehicle is when you are finally done making payments on it. Other than the fact that you no longer have monthly payments, as mentioned before, there is truly no better feeling than owning something you put your hard-earned cash towards.
- The monthly payments almost always end up being more when you buy a vehicle vs. when you lease a vehicle. This is because you’re not only paying off the vehicle, but paying for interest, other finance charges, taxes & some fees. To get an idea of what your monthly payments would look like, use our Online Payment Calculator!
- With buying a vehicle comes eventually owning that vehicle. That means it’s your responsibility when you decide you want a new one. There’s no certain timeline to how long your vehicle will last, so it’s your responsibility to sell or trade the vehicle in when the time comes.
Leasing a Vehicle
- One of the greatest things about leasing a vehicle is the lower monthly payments (a majority of the time). Because you’re only paying for the vehicle’s depreciation during the lease term, along with interest (or rent) charges, taxes & fees, the payments can end up being significantly lower than if you were buying the vehicle.
- When the lease term is up, so is your commitment. If you’re someone who likes to switch things up often, leasing may be a good idea for you. Once your lease ends & you pay any end-of-lease terms, you’re free to walk away.
- Unlike when you buy a vehicle, the future value won’t affect you as the vehicle depreciates.
- At the end of the lease term, you will have several options. You can either finance the purchase of the vehicle or decide to lease or buy a different car. In other words, no strings attached.
- The most obvious con about leasing a vehicle is that you don’t own that vehicle. However, there is the possibility of buying the vehicle for a more affordable price when the lease ends.
- The up-front costs can end up being a little more complicated than what you originally thought. With the first month’s payment, you’ll also have a refundable security deposit, an acquisition fee, a down payment, taxes, registration, and other fees.
- Because a lease usually has a set time period, there isn’t much wiggle room for getting out of the lease early. Unless you want some hefty charges, it’s best to find a vehicle you know you’ll like for the whole lease term.
- Unlike when you buy a vehicle, the number of miles you drive may be limited. Most leases allow for 12,000 – 15,000 miles per year, with extra charges for exceeding the limit.
- Most leases will hold you financially responsible for exceeding what would be considered any wear & tear.
- Since you will be leasing the vehicle, you can’t customize it to your specific wants. If you decide to modify or add any custom parts, they will have to be removed before the lease ends. However, you would either have to file an insurance claim & pay a deductible or pay for any residual damage, so it’s a risk you may not want to take.
Still not sure which option is best for you? Contact our Auto Finance team through the online form on our website! For your next car loan or Honda lease, simply apply here online and get approved free without any obligation to buy. Let Mungenast St. Louis Honda customize a payment option & plan that works for you!