Do I Lease or Buy Car?

When a car is leased it is rented for a period of time. Ownership is retained by the dealership. The car is driven for a period time, two or three years. At the end of that time the car is turned back in or purchased or a new car leased.

The leased car price is based upon the depreciation of the car over the term of the lease contract.

A lease deposit is required at the signing of the lease. It is based upon the vehicle being returned in a qualifying condition.

When a vehicle is purchased there are no conditions to be met, aside from the agreed upon payments.

Considering the conditions of a lease over buying a car a body might consider these conditions.

• Deposit - Basically a security deposit based upon the condition of the vehicle when returned



• Mileage charges - Most leases stipulate the mileage to be driven. Usually about 12,000 miles per year. If the maximum miles is exceeded there is a penalty per mile assessed.



• Maintenance - The vehicle may be required to be maintained on a regular schedule or be docked on the Deposit if not.



• Depreciation - Estimated depreciation is generally lower than actual depreciation. This is a hidden cost at the end of the lease.



• Insurance - The vehicle will have to covered by specific insurance to protect the owner from sustaining a loss.

Deciding to lease or buy a car is a personal choice.

• What are you use requirement?
• Do you like a new car every two years?
• Do you like lower payments?
• Do payments matter?
• Are you tough on vehicles?
• Do you drive a lot?

In the choice is really up to you. What makes you happy? If you don't like the lease program, then Purchase a New Car Cheap next time around.