Advantages, Disadvantages of Car Leasing

               

Not everyone wants to go through the hassle of buying a new car, borrowing money to do so and making payments for years on an asset that only continues to decrease in value. An option is to lease a car rather than buying it. There are both advantages and disadvantages to leasing.

Lower payments

Typically, you get much lower monthly payments when you lease a car than when you buy it. This is because you are paying for much less of the car each month. One thing to consider is how much you have to put down on your lease, because that is a cost to add onto your monthly payment costs.

Car remains under warranty

Most leases are either two or three years long, which means your car remains under warranty the whole time you have it. That means you won't have to pay for any breakdowns.

Shorter commitment

If you are the type of person who likes to upgrade your car every few years, then leasing is a good option for you. You drive a car for two or three years then give it back and get a new one.

Constant payments

When you lease, you are constantly paying for a car with nothing to show for it once the lease ends. Even though cars depreciate, once you are done paying one off, it usually still is worth a few thousand dollars.

Mileage restrictions

Nearly all leases have mileage restrictions. Most leases allow only 10,000 or 12,000 miles every year and have large penalties if you exceed that amount. That makes a lease a bad option for someone who has to drive a lot.

Leasing has both pros and cons, and you have to weigh both before you decide if leasing a car is the right choice for you.

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