If you are looking at investing in a new car, chances are you are stuck between leasing and buying the vehicle of your choice. Let’s face it, getting a new car is complicated enough without having to worry about leasing vs buying.
Therefore, if you are looking to lease a car with a leasing company like Vavoom, here are four things you should think about to help you in deciding whether leasing or buying a car is the right choice for you.
1. The Make And Model Of The Car You Want
The overall price of leasing a car will be based on the price of the car itself, along with a number of other factors. You have complete freedom to choose whichever car you wish.
This means that leasing a car often allows people to drive a better vehicle than they could afford otherwise. However, the downside is that you will never own the vehicle yourself.
2. Think About The Depreciation Of The Vehicle
Over time, a car’s value will depreciate. In fact, the value of a car can drop by more than 20% after the first year of use. If you buy the car outright, then you should make sure to do your research and select a model of car that holds its value well so that you can resell it for a good price when the time comes.
However, by leasing a car, you do not have to worry about the depreciation of the car’s value. Instead, it is the responsibility of the finance company that owns the vehicle. Once the length of your lease has come to an end, you can just hand back the keys hassle-free.
3. Find Out The Price Options
All deals should clearly set out the pricing options, from the personal car finance per month to outright buying the car, to monthly leasing costs.
The key question to consider when deciding between buying or leasing a car is whether the amount you’d pay over the duration of the lease is higher or lower than the amount you’d lose by owning the car and reselling it over the same period.
In other words, the price you could buy it for plus interest costs, minus the price you would expect to sell it for. If it is lower, then leasing the car would be more cost-effective than buying, and if it is higher, you’re better off buying.
4. Consider Your Annual Mileage
Car leasing usually has a set annual mileage per year. If you go under it, you can use it the next year, but if you go over then you will be charged an excess fee. A similar rule applies for car insurance, so this is something that needs to be determined whether you decide to buy or lease your car.
Therefore, you must calculate your annual mileage. After agreeing on how many miles you will drive each year, you’ll pay a fixed monthly amount, often with a larger initial payment as a deposit. It’s just like renting a flat.
Overall, neither buying or leasing is categorically better than the other. Instead, it is down to personal circumstances and individual requirements.
If you are interested in even more business-related articles and information from us here at Bit Rebels, then we have a lot to choose from.