Should You Lease or Buy Your New Car?
Interested in getting a new car? You will face a big choice when you hit the dealership in Atlanta, GA: will you buy or lease?
There are several factors to consider when making this decision. Here’s a quick overview of what to take into account when looking into buying or leasing a new car.
If your primary concern when bringing home a new vehicle is minimizing your monthly payments as much as possible, leasing might be the best choice for you. Generally speaking, you can expect lease payments to be lower than car loan payments, because those payments are based on the vehicle’s depreciation during the time you have it under the lease.
Lower monthly payments can help your budget, but ultimately the period won’t end in ownership, which means you’ll probably be facing the decision of whether to buy or lease again at some point in the future. Meanwhile, your car insurance provider might require you to add on some extra coverages if you’re leasing the vehicle, including gap insurance and comprehensive and collision coverage.
If you’re more concerned about overall costs, it’s in your best interest to buy rather than lease. At some point, your auto loan payments will end, and you will have full ownership of the vehicle. The down payment might be difficult to make if you want to put down 10 or 20 percent of the total cost of the vehicle, but you can expect to pay less to purchase a car than you would if you leased over a long term.
Again, those payments will eventually come to an end. If you know you’re going to be using the car for a long time, it’s only a matter of time before lease payments surpass what you would have paid to buy the vehicle.
The costs of repairs should also be considered—older cars do need more attention with repairs and maintenance, so you might not have to worry about that quite as much with leased vehicles. Depreciation is also a consideration—the more miles you put on the vehicle, the more the value of the vehicle depreciates. While this will affect a car you own, it could also potentially result in you receiving some mileage penalties if you are leasing.
Finally, if flexibility is something you care about, leasing is probably the best option for you. If you purchase a car, there’s no way around it: you’re in it for the long haul. Leasing is great for people who like to upgrade their vehicles regularly, or who simply enjoy driving something new and exciting around town. That doesn’t mean leases themselves are always flexible—there are some very rigid terms you’ll need to follow when you’re under a lease. But that rigidity is nowhere near what you’ll find in purchasing a vehicle.
Need some more factors to consider when deciding between buying or leasing a new car in Atlanta, GA? We encourage you to contact Emory Alliance Credit Union today with any questions you have and we will be happy to provide you with additional information to help you make an informed choice.
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