By Francis Fransour
A lease requires little or no money up front and offers lower monthly payments. But when the lease ends you are left without a car and a need to replace it.
Buying a car is more expensive initially and the monthly payments are higher. But at the end of the loan, you will own a car you can still drive or sell.
Other key factors that differentiate leasing and buying include:
Advantages of Leasing
You can drive a better car for less money
You can drive a new car every few years
No trade-in hassles at the end of the lease
Advantages of Buying
When interest rates are low, it makes more financial sense to own a car rather than lease it No mileage penalty
Increased flexibility - you can sell the car whenever you want
Who should lease their new car:
People who like to buy a new car every 2 to 3 years. Leasing will allow you to lower your payment or to drive a more expensive car with a monthly payment similar to a less-expensive car.
Who should not lease their new car:
People who like to keep their cars for a long time, high-mileage drivers, and those who don't want to be forced into a decision about buying another car at the end of the lease period.
Tax advantages of leasing a car
If you use your car for business, you may be able to write the entire amount of your lease payment off your taxes (as opposed to writing off just the interest on a new-car loan). Tax regulations are constantly changing, so it's best to consult your accountant or tax professional about the tax advantages of leasing a car.
Peterwarren Motors --
http://www.peterwarrentoyota.com.au
A lease requires little or no money up front and offers lower monthly payments. But when the lease ends you are left without a car and a need to replace it.
Buying a car is more expensive initially and the monthly payments are higher. But at the end of the loan, you will own a car you can still drive or sell.
Other key factors that differentiate leasing and buying include:
Advantages of Leasing
You can drive a better car for less money
You can drive a new car every few years
No trade-in hassles at the end of the lease
Advantages of Buying
When interest rates are low, it makes more financial sense to own a car rather than lease it No mileage penalty
Increased flexibility - you can sell the car whenever you want
Who should lease their new car:
People who like to buy a new car every 2 to 3 years. Leasing will allow you to lower your payment or to drive a more expensive car with a monthly payment similar to a less-expensive car.
Who should not lease their new car:
People who like to keep their cars for a long time, high-mileage drivers, and those who don't want to be forced into a decision about buying another car at the end of the lease period.
Tax advantages of leasing a car
If you use your car for business, you may be able to write the entire amount of your lease payment off your taxes (as opposed to writing off just the interest on a new-car loan). Tax regulations are constantly changing, so it's best to consult your accountant or tax professional about the tax advantages of leasing a car.
Peterwarren Motors --
http://www.peterwarrentoyota.com.au
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