Key Takeaways:
- Car financing is your best bet if you like to keep your ride for a long time and put many miles on them.
- Car leasing is a suitable option if you like having the latest model and don’t mind returning it after a few years.
- Leasing offers lower monthly payments, but you have to follow the terms of your contract, restricting you from driving beyond specific miles during the period.
- Financing lets you own the car at the end of the term as you pay your monthly installments that include the cost of the vehicle plus the markup.
- Also, read our blog on automatic transmission gears to know their essentials before you drive your next vehicle.
- Infiniti of Melbourne is a premium car dealership offering leasing and financing options to its customers in Palm Bay, FL, and the surroundings.
Leasing and financing a car are two different ways to get behind the wheel of your dream vehicle. While both have their benefits, there are some key differences that you should be aware of before making your decision. Infiniti of Melbourne will break down those differences so you can make the best choice for your unique needs. Stay tuned!
Leasing a Car
Leasing a car is essentially renting it from the dealership for a set period, typically two to four years. During that time, you’ll make monthly payments and adhere to a particular mileage with the wear-and-tear restrictions. You can purchase or return the car to the dealership when the lease ends.
Financing a Car
Financing a car, on the other hand, means taking out a loan from a bank or a credit union to pay for the vehicle in full. Once you’ve paid off the loan, the car is yours to do as you please. There are no mileage or wear-and-tear restrictions like there are with leases.
Now that we’ve gone over the basics of leasing and financing a car, let’s compare the pros and cons of each option.
1. Leasing Pros:
– Lower monthly payments than traditional financing.
– No need to worry about selling the car or finding a buyer when your lease is up, as you can turn it into the dealership.
– You always drive a brand-new car without worrying about repairs or maintenance costs.
2. Leasing Cons:
– You never actually own the car; at the end of your lease, you have to return it to the dealership unless you decide to purchase it (and then you’re essentially starting from scratch, as you’ll be making payments on a brand new car).
– If you go over the mileage limit or damage the car, you could face some hefty fees.
– You may have to put down a sizable security deposit when you first lease a car.
3. Financing Pros:
– Once you make your last payment, you own the car outright and can do with it as you please; no need to worry about returning it or making another purchase.
– If you keep the car for a long time, you’ll eventually build up equity in it.
– Mileage limits, like leasing, do not restrict you, so if you want to take a cross-country road trip, go for it!
4. Financing Cons:
– Higher monthly payments than with leasing (although this will depend on the length of your loan, your credit score, and the downpayment you contribute).
– If you want to get out of the loan early, you’ll likely have to pay a pre-payment penalty
– You’re responsible for all repairs and maintenance on the car; with leasing, that’s typically covered by the manufacturer or dealership
If you’re looking for a new car but aren’t sure whether to lease or finance it, you’re not alone. Many people get in this situation, and deciding which option is right for them can be challenging.
With leasing, you effectively rent the car from the dealership for a set period (usually two to four years). You’ll make monthly payments during that time, but at the end of the lease term, you’ll have to return the car unless you buy it outright. One advantage of leasing is that your monthly payments will typically be lower than if you financed the purchase of the exact vehicle.
With financing, you’re essentially taking out a loan to pay for the car and will own it outright after paying off the loan with interest. The monthly payments are usually higher than with leasing, but you’ll own the vehicle at the end of the term. Another advantage of financing is that you’re free to modify your vehicle as you see fit (within reason, of course, regarding leasing versus financing your next car, it depends on what works best for you and your budget. Some people prefer the lower monthly payments of leasing, while others like the idea of owning their vehicle outright after making loan payments.
So which option is right for you? Ultimately, it depends on your circumstances and driving habits. If you like having the newest car model every few years and don’t mind making monthly rental payments, leasing might be a good fit. But financing is probably the way to go if you don’t mind keeping your car for longer and prefer the monthly installments with interest to own the vehicle. Regardless of how you want to pay, make sure you do your research so you can get the best deal possible. Happy car shopping!
If you’re still unsure which one suits you better, speak with your financial advisor or car dealership for more information. They can assess your preferences and budget to help you make the best decision for your situation.
Need Car Leasing or Financing Services in Palm Bay, FL?
Our team at Infiniti of Melbourne, serving Palm Bay, FL, is committed to providing our drivers with the best possible car-buying experience. Browse our inventory to check our selection of new and pre-owned cars. We also offer competitive financing rates and leasing options so that you can get behind the wheel of your dream car today. If you’re ready to start shopping, apply for financing or check our leasing program. We can’t wait to help you find your perfect vehicle.
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