Should I Buy or Lease a Car?

Bringing a new car into your life is always a big decision. Whether you’re moving to a new city with not-so-reliable transportation facilities, starting a family, or just need one to commute to work, there are several reasons you might have to buy a new car. 

More and more people these days, however, are choosing to move away from the traditional option of buying a vehicle. With good reason, leasing is the latest trend among those who don’t value cars as a top priority. Getting a car doesn't have the social or financial cachet it once did, which is why leasing is an increasingly popular option. 

Depending on your needs, you can go for either. Confused as to which one is a better option for you? At Walker’s Renton Mazda, our experienced sales staff will help you decide if a new or used car is right for you, and guide you through our inventories. Read on to familiarize yourself with a few features and differences before you visit our store, so you’ll know all the right questions to ask. 

Related: Questions To Ask When Buying A Used Car

What is the Difference Between Leasing and Financing? 

Leasing and financing are two other ways of getting a car if you’re not planning to buy one outright with cash. They both involve agreeing to make monthly payments, but with slight differences. Based on your financial situation and the reason you want a car, one can be better than the other. Here are some differences between the two to help you figure out what might suit you more.

  • The main difference between the two methods is the ownership of the car. With financing, the lender holds a lien against your car. Once the payment term is over, you can walk away with the car. Therefore, every payment you make takes you one step closer to fully owning it.

Leasing, on the other hand, is like rental payment. You must return the car to the dealer once the lease ends. One does have the option of buying the car at the end of the lease, but the cost will be much higher than what you’d see at the beginning of leasing.

  • Financing costs more than leasing. A lease covers the car’s depreciation. Therefore, leasing is paying the money that the dealer has lost, which is why leasing also has mileage restrictions. This is why you need to pay an additional amount if you drive extra miles. 

Finance payments are higher because you’re paying for a combination of the depreciation as well as the buying equity. Unlike leasing, there are no additional costs involved here. Once the finance payment period is over, you no longer have to worry about dishing out more cash.

  • The monthly payment for leasing is lower than financing. This allows you to lease a car that otherwise would have been too expensive for you to use through financing. You can also choose to get a better car once the lease period is over, which is generally three years.

On the other hand, if you really like the car you’re driving, financing serves as a better go-to option. The reason behind this, of course, is that you don’t have to give up the car after a certain period.

  • Leasing offers better warranty protection as compared to financing. A car’s warranty lasts for about three years, which works out well as that coincides with the lease period. 

With financing, though, the cost of maintenance increases because the individual owns it beyond the warranty period. You don’t have to worry about that with leasing, and can always have a new car once the lease period is over.

Check out our pre-owned vehicle specials at Walker’s Renton Mazda here.

Buying vs. Leasing a Car

2019 Mazda CX-9 Touring SUV

Not sure of whether to lease a car or buy it? Let’s take a look at the pros of cons of each of the options to come to a conclusion.

Pros of Buying a Car:

2019 Mazda6 Sedan

  • You get to own your own car and do whatever with it without having to fear any restrictions. The freedom of customizing it according to your desire is an added bonus. 

  • If you perform proper maintenance, drive it out well, and clear out all the payments, buying a car is the more affordable option.

Related: Are Mazdas Reliable? Find Out

Cons of Buying a Car:

  • The monthly payments will be higher compared to a lease.

  • If you choose to buy a different car, the responsibility of trading or selling the car will be solely on you.

  • Sudden post-warranty repair costs may occur.

Pros of Leasing a Car:

  • Monthly payment for leasing a car is less expensive when compared to paying a loan after buying a car.

  • The warranty you receive is incredible. Covering the expenses of a purchased car once the warranty period is over can be quite troublesome. With a leased car, you never have to fret about the warranty since it will always be covered for you.

  • Selling or trading a vehicle is an extremely stressful, expensive, and time-consuming process. Since cars depreciate quickly, they’re not much of an investment unless it’s a rare or vintage car. Therefore, the tension of having to sell it can be avoided with leasing.

Cons of Leasing a Car:

  • If you don’t have a steady source of income or happen to run into financial issues, paying every month for the lease can be a hurdle.

  • Leasing doesn’t allow you to drive after a certain number of miles. Therefore, you will have to cover the charges if you drive more than the assigned limit. 

  • You might end up paying more while leasing a car than purchasing one. Buying a car gives you the option to get some money if you decide to sell it, at the very least.

Summing Up

Although buying a car is a matter of huge responsibility, it’s also a more permanent investment. It’s true that leasing is becoming an increasingly popular option, but buying is still the better financial option if you plan to use it frequently in the long run. 

If you have the financial stability and want to be able to operate your car the way you want, buy a car rather than leasing one. However, weigh all the features and pros and cons, and looking at the state of your finances, go for the one that will better suit your future and comfort. 

Both are viable options - it simply depends on your specific situation.

Related: How to Prepare Your Car for Fall

Categories: Finance