It is the classic dilemma that faces every single auto-consumer available: Pay money upfront or forego the ownership and pay monthly settlements instead? Purchase or lease for a new set of wheels?
As is the case with every other prevalent dilemma, there is no slam-dunk answer. Each choice has its own benefits and drawbacks, and it all depends on a set of monetary and personal considerations.
First, your finances. Affordability is clearly key, and you should ask the question of how stable is your job and how healthy is your general monetary scenario. The short-term monthly-cost of leasing is considerably lower than the monthly payments when purchasing: you only pay for 'the portion' of the vehicle's price that you simply use up during the time you drive it. In case you have a lot of cash upfront, then you can opt to pay the down payment, sales taxes - in cash or rolled into a loan - and also the interest rate determined by your loan firm. Buying effectively gives you ownership of the automobile and that feeling of 'free driving' that goes on supplying transportation. If, say, you want to get into luxury models but cannot afford the upfront cash of buying the vehicle than you are a great candidate for leasing. Unlike buying, it gives you the option of not having to fork out the down payment upfront, leaving you to pay a lower dollars factor which is normally comparable to the interest rate on a financing loan. Having said that, these advantages have a price: terminating a lease early or defaulting on your monthly lease payments will result in stiff monetary penalties and can ruin your credit. You need to ensure you carve out the monthly lease payment inside your spending budget for the foreseeable future, at least for the duration of the lease.
Besides the financial aspect, making a buy or lease choice depends on your own certain way of life options and preferences. Think about what the car means to you: are you the sort of individual to bond with the car or would you rather have the excitement of something new? In case you need to drive a car for a lot more than fives years, negotiate carefully and buy the auto you like. If, on the other hand, you don't like the notion of ownership and prefer to drive a new auto each and every two to 3 years then you need to lease. Next, factor your transportation needs: How many miles do you drive a year? How correctly do you maintain your cars? Should you answer is: 'I drive 40,000 miles a year and I don't genuinely care a lot about my cars as I do not mind dealing with repair bills', then you're in all probability greater off purchasing. Leasing is based on the assumption of limited-mileage, ordinarily no much more than 12,000 to 15,000 miles a year, and wear-and-tear considerations. Unless you'll be able to maintain within the prescribed mileage limits and maintain the auto in a good condition at the end of your lease, you might incur hefty end-of-lease costs.
Author Resource:
The InterCars.co.uk site gives information on uk cars and pcp plans .