Can’t wait to buy the car of your dreams? But have you considered everything there is to know about purchasing it? And now are you struggling to make your final call?
Well if any of these questions make you answer “yes”, then this article will guide you through everything you need to know about.
While buying a brand new car can be very alluring if you have the budget, it can also get quite overwhelming. Closing up to a hasty decision can cost you highly down the road (both literally and hypothetically).
For people with lower budgets, leasing a car should be a good option. A lower monthly rate for using a car would seem more ideal to many. The longer the lease, the lesser will be the monthly payment. And if you struggle to pay for the monthly payment, you could always consider car lease takeover.
Car lease takeover is an affordable way to get out of a car lease, or an affordable way to get a car by taking over the lease from a person who wants to end his lease agreement. It has many advantages that are stated below.
Buying or financing a car would mean requesting a loan from the bank, which you would be required to pay back with the interest rate included. The upside of buying cars is that you could make any kinds of modifications you like. But with passing years, the value of your cars will be depreciated, giving you from little to no resale value, in the end.
Let’s get down to the specifics of buying and leasing a car.
FINANCING A CAR
Upsides of financing a car
Above all, you have the ownership to your car and there will be no exemptions put forward against you. Given that you have enough cash to buy it outright. If you finance your car, you will eventually own it.
As detailed above, you can customize your car according to your wishes. And of course, you will not be tied to any kinds of lease payments. You could drive any number of kilometers, not in fear of crossing the limit that comes with leasing.
Downsides of financing a car
Financing a car does not mean that it is free of any discomforts. Like everything else, it also has a set of pros and cons.
Owning a car could mean a higher monthly payment. This is in regard to the loan you’ll be paying back.
Possible unexpected repair costs post the warranty period come as natural as bees to flowers.
Most importantly, your car would most definitely lose its resale value in the coming years.
LEASING A CAR
Upside of leasing a car
If you don’t have enough money to buy a car, then leasing one would be a good option for you. Leasing a car comes with lesser monthly payments than financing one. Usually there are no down payments for leasing a car, but even if some leasing companies require it, you would be able to afford it, which would mean that you could drive a better car than the one you would purchase.
You wouldn’t have to worry about repair costs and the resale value as it would be covered by the financier.
According to a study, the real value of financing a car is slightly higher than leasing.
You could on the other hand relatively avoid a huge lease payment by looking for a person who wants to get out of a lease agreement. This is called car lease takeover or care lease transfer. It is ideal for the seller to quickly get out of a car lease who is no longer able to cope with the payments, with minimal hassle. It also benefits the buyer by helping them avoid most of the lease payments, given the seller went through the initial payments.
Downside of leasing a car
Even though you don’t exactly own the leased car, but it doesn’t mean that you will be exempted from any insurance payments. You will be charged additionally for wear and tear. And since you do not own the car, you cannot make any modifications to it. Also, you can drive only a limited number of miles since going overboard will cost you extra.
For a better financial future, you must have good knowledge over the above stated entities.