Leasing a new car can have many benefits over buying a new car depending on your situation. While a lease is not the best option for everybody, it certainly has some positive attributes that will fit certain people's lifestyles very well. If you take your time, you should be able to find some nice deals on car leases. Here are some facts about leasing a new car instead of buying.
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Lower Down Payment
While purchased vehicles usually require hefty sums of cash for down payments, leases usually do not require down payments. You may, however, still have the option to make a down payment on a leased vehicle, which will lessen your monthly payments.
Lower Monthly Payments
The monthly payments for the typical lease should be lower than the monthly payments for the typical purchase. This is because lessees only need to pay for the car's use and depreciation over a set amount of time, usually 2 to 5 years.
Headache-Free Maintenance
The term for an auto lease usually coincides with the manufacturer's warranty for a new car. Hence, a lessee will most likely not have to worry about maintenance and repair payments.
Lower Taxes
When you purchase a new or used vehicle, you will pay a tax on the full purchase price. Since cars are relatively expensive, these tax costs can add up. When you lease a vehicle, you will only be paying a tax on it for a set amount of use and time. Thus, you'll save some money.
Hassle-Free Transitions
Car owners usually sell or trade-in their used vehicles once they decide to purchase new cars. Since auto leases expire after a certain length of time, lessees merely have to bring the car back to the dealer. Then, they can proceed to lease a new vehicle without having to worry about trading-in or selling their old car.
Mileage Limits
One downside to leasing a vehicle is the yearly mileage limit. Usually, auto leases will restrict you to 12,000 to 15,000 miles per year. If you go over the allotted mileage, you will have to pay 20 to 50 cents per extra mile.
Excess Wear Charges
Another downside to leasing a vehicle is the possibility of having to pay for excess wear and tear. A leased vehicle is inspected when the lessee returns it at the end of the lease term. If the lender determines that the vehicle was not properly taken care of and has accumulated excess wear and tear, the lessee will be charged.
Auto leases are good options for people who want to drive nice cars for less money. However, you need to remember that the amount of miles that can be driven per year in a leased vehicle has a ceiling. You also need to take care of a leased car to avoid excess wear charges. But, as long as you understand the potential pitfalls of an auto lease, you should be able to enjoy driving a new car for less money per month.
