The news from the auto industry continues to move in a positive direction, which is, of course, a positive for the metro Detroit area and the state of Michigan.
With more people making decisions about their next cars, they are faced with a dilemma –should they buy or lease? The answer depends on your current goals and situation.
So what does your personal decision depend on? Your answers to the following questions could help with your decision.
- Do you need to improve your cash flow? If cash flow is an issue, leasing could be the solution, because leases tend to have a lower monthly payment but you won’t build the equity you’d have if you bought the car. When your lease is up you will not have a vehicle to trade in to bring down the cost of your next vehicle.
- How often do you really want a new car? If you aren’t concerned with having the latest model with the most up-to-date gadgets, you should consider purchasing a car to keep and drive for a few years. If you like the latest and greatest every few years, you could be a candidate to lease.
- How many miles do you drive? Mileage limitations may be the biggest concern with leasing a car. The average limit on a leased vehicle is about 15,000 miles per year, so take your daily commute and vacation plans into consideration when debating lease or purchase. Often you will pay major fees for violating the mileage terms of your lease agreement.
- What are your vehicle needs? If you are set with your home, family and job, leasing could a good option, since your miles, terms and costs are already discussed. However, if you plan on getting married, having kids, moving, or changing jobs in the near future, you may want to have the flexibility of changing your vehicle and purchasing a car makes more sense.
Nearly 70% of drivers purchase their cars instead of leasing them, and generally you will save money by driving your vehicle longer. The most important thing is to know your needs and evaluate your option. .
Community Financial can help you do your research online at our Auto Resource Center to compare different makes and models, see what your trade in is worth and check manufacture rebate programs.
Once you’ve researched your options let us give you several payment options so you can honestly compare the cost of leasing v buying your new car. To check out our current low auto loan rates, click here, or come in to one of our eight convenient locations to speak with one of our team members.
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