| Leasing And Buying Comparison Chart |
| Leasing |
Buying |
| Someone else owns the vehicle. |
You own the vehicle if you pay cash or after you pay your loan in full. |
|
You have lower monthly payments because you
are paying only for the vehicle’s depreciation
over a limited time period. Lower payments may
allow you to drive a more expensive vehicle than
you might otherwise purchase.
|
If you finance, you pay higher monthly payments because you are
paying for the total cost of the vehicle plus interest.
|
|
Your lease contract includes mileage limits. If you
exceed the limits, you can be charged a penalty. You can
also be charged for excess wear and tear when you return the vehicle.
|
You may drive as many miles as you wish.
|
|
In most cases, the lessor assumes the depreciation
risk.
|
As the owner, you are affected negatively by the
depreciation of your vehicle.
|
|
Your upfront fees are small or nonexistent. You
may have no down payment or a small one.
|
You may be required to make a down payment
although 100% financing is sometimes
available.
|
|
Most lease companies charge an acquisition fee or
“bank fee” which may range from $400 to $1,000.
|
Purchase contacts may also have “hidden fees.”
Read the contract carefully.
|
|
You can drive a new vehicle approximately every
3 years if you are comfortable with continuous
payments.
|
After you pay your loan in full, you have no
monthly vehicle payments. If you want a new
vehicle, you must apply for a new loan
or pay cash for the new vehicle.
|
|
At the end of the lease, you return the vehicle.
|
At the end of the loan term, you own the vehicle.
|
|
You have no used vehicle to dispose of when you
are ready for a new one.
|
When you buy a new vehicle, you must trade in,
sell or donate your used vehicle if you do not want
to keep it.
|
|
You are not buying a depreciating asset.
|
You are buying a depreciating asset.
|
Buying Your First Vehicle
Auto Insurance
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