Buy vs. Lease

Leasing is not a bad word. In fact there are areas of the country that leasing equals up to 70% of all new vehicle sales.

We all know what a "Buy" is, so let's take a look at a lease:

  • Fixed monthly payment
  • Only pay taxes on months used
  • Terms from 12 to 60 months (depending on Lessor parameters)
  • Lease Credits (residualized) for certain vehicle accessories
  • Customizable mileage
  • Guaranteed Lease End Value
  • No negative value ("upside down")

Leasing is still all the rage in certain areas of the country and can be a smart decision. If you are someone who like to drive a new car all the time a lease allows you to do so. It allows you to not worry about vehicle values when it comes time to get a new vehicle.

Let's take a look at the most frequent leasing objections by a consumer:

  • I don't own it!
    • Well, do you really own you car while you are making payments on it. No, the bank owns it.
  • I drive too many miles!
    • This may be the case, but taking a look at your leasing options based on your projected driving habits is suggested. And why do we suggest this? Because, we believe you should have all the options available to you to make your educated decision.
  • I can't trade it in!
    • In reality you can, it's just not called a "Trade-In".

      So here is how it works; when it comes time to get a new vehicle have the leased vehicle appraised by the used car manager. Once you have the appraisal amount compare it to the residual value ("lease buy-out"), if the appraisal amount is more then the Dealer can buy-out the lease and you have that extra money to apply to your new vehicle purchase. If the appraisal amount is lower than the residual amount, then just turn the lease in and walk away from it.
  • Learn more about your leasing options with ASK A.B.E.'s automotive buyer's educational course.