Have you ever thought about leasing your next car? I’m not here to tell you to do that, (I’ve never done it) but it is an interesting option. If the thought has crossed your mind, here are a few pros and cons of leasing a car.
Pro: Lower monthly payments
Generally, lease payments are lower than car payments and if you’re used to having a payment, this probably sounds great to you.
Con: No equity
When you sign a lease, you’ll have to make payments over a defined period of time. When that time is up, the car goes back to the dealer. At this point, you’ll have a decision to make. You can either enter into a new lease or you’ll have to buy a car.
Pro: Repairs are usually covered
Since you’ll only have a leased car for a handful of years, it will more than likely be covered by a factory warranty. This will save you from having to shell out big bucks for repairs while you have the car.
Con: Mileage limit
How many miles to you drive each year? If you drive over 10-12k miles a year, you’ll probably face some sort of penalty at the end of your lease term. Be mindful of this, because those extra miles can really add up.
Pro: A new car every few years
If you’re serial leaser, I’d assume you probably love driving a new car. This is a definite advantage of leasing over buying. Buying and selling cars can be a hassle, so if you love driving new cars, leasing can be a great option for you.
Con: Fees for damages
When you turn in your car at the end of your lease term, the dealership is going to want to sell it. If there are any dents or scratches to be repaired, you may want to get them taken care of before you turn in the car. A little ding in the door isn’t a big deal if it’s your car, but with a lease, you’ll probably have to pay a fee to get those repaired.
Leasing isn’t for everyone. There are definitely advantages and disadvantages to leasing vehicles. Do your homework and decide what is best for you.