People often think that driving a new car every few years is a frivolous expense, but this isn’t always the case.
While it’s true that buying a car can be expensive, leasing a car is a more affordable option that may be available to you. Here’s what we found out about leasing a car!
Why Should You Lease A Car?
Leasing a car is a viable alternative to purchasing one because the payments are more affordable in [currentyear]. Additionally, the duration of the lease means that the cars will be newer and won’t require major repairs. At the end of the lease, you will also have the option to purchase the car or lease a new one.
To learn more about the benefits of leasing a car, keep reading!
1. Less Financial Burden With Car Leases
One of the most attractive aspects of leasing a vehicle is that it’s more affordable than purchasing one.
Since car leases tend to have an average duration of 36 months, the monthly payments for a car lease will be lower than financing a car.
Additionally, it’s possible to negotiate a lower down payment amount to reduce the amount you would give up in case of a total wreck.
These things, all in all, contribute to the appeal of leasing a car over financing one.
2. Leasing A Car Warrants Lower Interest Rates
You typically pay lower interest rates when leasing a car.
Generally, your credit score will still largely determine how much you’ll pay in interest along with the monthly payments.
However, these will still be far lower rates than if you were to finance a car.
For example, a strong credit score will get you an interest rate of 7.6% for a new car, versus 2% to 5% if you lease the car instead.
This, coupled with the lower monthly payments, adds to the attractiveness of leasing a car.
3. Flexible Lease Terms Depending On Your Needs
Aside from the points above, leasing a car grants you more flexibility.
While the average lease length is 36 months, other companies offer shorter or longer lease durations according to your needs.
Additionally, mileage limits are typically built into the lease agreement, but you can choose to get a higher mileage if you find you need it.
Also, some manufacturers may make oil change costs and other routine maintenance costs free for the duration of the lease.
All things considered, these are enticing reasons to lease a car over buying it.
4. Access To New Car Models And Technologies
With leasing, you get to drive the latest models and experience the latest safety features and technologies that cars offer.
Since leases don’t typically last more than a few years, you’ll be able to experience smoother drives than on a well-used or older car.
Additionally, you can sign a lease for the newest model available once your current one ends.
Therefore, this allows you always to get the most up-to-date automobile technologies available on the market.
5. Large Selection Of New Vehicles Available For Lease
In addition to having access to the latest models that car manufacturers offer, you’ll be able to drive a higher-end vehicle that may not be as accessible if you were to finance it.
For instance, luxury automaker BMW offers an option to lease any of the latest models of the company’s vehicles.
Additionally, since the lease payments for these luxury cars are lower than paying for an auto loan, you’ll be able to ride in style without the high cost.
6. Major Repairs Are Covered By The Warranty
Another benefit of leasing a car is that you’re guaranteed a new car for the next few months or years.
Generally, you’re signing a lease for a brand-new car, which means that the manufacturer’s warranty will cover it.
This is advantageous since warranties typically last two to five years and means that your car will be covered for the duration of the lease.
As such, you won’t have to pay for any major repairs stemming from manufacturer defects.
7. Leasing New Cars Is Better For The Environment
Leasing cars can be better for the environment in the long run. Typically, older vehicles are not as fuel-efficient as newer models available today.
Furthermore, older cars produce more carbon emissions due to the larger fuel consumption and wear and tear on car parts over time.
However, when you lease a new car, you get to drive a more fuel-efficient vehicle, which saves you money on fuel costs.
Additionally, newer cars produce fewer carbon emissions and thus are better for the environment.
Since you get a new car every time you enter a lease, you’re also doing your part in helping the environment.
8. No Need To Worry About Resale Value
One of the benefits of leasing is that the car’s resale value doesn’t have to be a concern for you.
If you choose not to buy the car at the end of your lease, you don’t have to worry about the depreciation after the contract is over.
Also, you won’t have to deal with selling the car for far lower than you paid, which is a common problem that people who purchase their cars often deal with.
As a result, the convenience of simply returning your car or trading it in for a new one is invaluable and helps make leasing more attractive.
9. Some States Offer Tax Rebates
Leasing may be more cost effective and practical than purchasing cars outright if you run a business requiring a fleet of vehicles.
Generally, you may take advantage of various tax discounts for businesses with car leasing, from mileage rebates to low emission savings.
Also, the lease payments can be treated as a business expense, which means they can be deducted from the VAT you would need to pay when filing taxes.
As such, this makes leasing appealing to business owners.
10. Multiple Options Available At The End Of The Lease
Alongside the other stipulations in the lease, you also get to decide what you plan to do once the lease ends.
First, you can return the car to the dealership and pay a turning-in fee of approximately $350.
Additionally, you can purchase the vehicle for its residual value—that is, the car’s perceived value at the end of the lease.
Finally, you can sign a new lease for a new car, with incentives often available to encourage people to lease cars more often.
These things all make leasing an appealing alternative to purchasing a vehicle.
11. Dealers Offer Leasing Incentives
Some dealerships and leasing companies also offer leasing incentives.
For instance, Honda Financial Services offers loyalty benefits that incentivize leasing newer Honda vehicles after your lease ends.
Additionally, there are conquest deals offered by companies like Chevrolet, where thousands of dollars are discounted off the lease if you switch over from a lease with another manufacturer.
On top of that, there are rebates for veterans and corporate discounts. All in all, these things combined make leasing a vehicle attractive to consumers.
To know more, you can also read our posts on why rental cars are so expensive, why car insurance is so expensive for seniors, and why superchargers are so expensive.
Instead of purchasing a car, leasing is a great option to consider because it grants you the option to enjoy a new car for cheaper than if you were to finance it.
Additionally, leasing eliminates the need to worry about selling your car at a lower resale value. Therefore, it’s worth considering a car lease over buying it.