The Pros and Cons of Auto Leasing

Should I lease a car or buy the car? Which is the better option? Everyone who has ever considered leasing has had these questions cross their mind. Learning the pros and cons of auto leasing is an important first step to making the right decision.  Car leasing has many advantages and some disadvantages, each of which should be considered before proceeding with a major purchase.

Some of the pros and cons of auto leasing are as follows:

  • Monthly car payments are lower – Your monthly lease payments can be lower than for a loan to purchase the same car.
  • Lower upfront costs – Usually a smaller down payment than that required for a purchase.
  • Drive a new car more often – With a lease, you are able to drive a new car every two to four years, depending on the length of your lease.
  •  No trade-in or used car hassles – At the end of the lease term, you simply return the vehicle and lease another. No need to sell your used car or haggle over trade-in value. 
  • Leasing can be more complicated – Dealers often do not explain how the lease payments are calculated and how the lease works.
  • The long term cost of leasing can be more expensive than buying. With a purchase, you can keep your car for many more years than leasing, reducing the cost per year.
  • Limited mileage – If you drive more than the allowed total mileage, you are typically charged 15 to 25 cents for each mile. If you plan to drive more than 12,000 miles per year, leasing can be more expensive.
  • Can’t customize – The car has to be returned to the dealer at the end of the lease in its original condition. You can’t make changes to or customize the car.

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