Why Is Car Leasing Cheaper than Buying?
There’s a good chance that you’ve seen leasing advertisements on TV, in the newspaper, or on billboards. These plans are always promoted as coming with payments that are less expensive than what you would pay by financing a purchase, but how exactly does this work? Thankfully, is here to break it down and give you some more information. That way, you’ll have an easier time deciding if leasing makes sense for your situation.
How Does a Car Lease Work?
If you’re new to leasing, then you’re probably wondering how this type of contract works. Unlike a traditional financing agreement that involves paying off a given vehicle’s entire sticker price over a certain time period in order to own it, leasing involves taking possession of a new ride temporarily. Your contract is based upon a number of factors, including how many miles you drive over the course of a year and how many years you’d like to behind the wheel. Many customers choose this type of plan due to the greater degree of flexibility over a standard car loan, but what makes such a contract less expensive than buying?
Determining Your Payment
As we mentioned before, leasing grants you temporary ownership of a vehicle. This means that instead of paying off the full sticker price, you’re just on the hook for covering your ride’s depreciated value. This amount is calculated by our experts by accounting for a variety of factors that determine how much of its initial value a given set of wheels will lose while it’s in your possession. Since you’ll be returning the car to us once your lease is up, you’ll only end up paying for a fraction of the overall price. In addition, we also take the number of miles you’ll accumulate into account, as the more driving you do, the more you’ll need to pay each month.
Is Leasing Right for Me?
Now that you know why leasing is less expensive than buying, you’ll need to decide whether or not this type of contract makes sense for your budget and lifestyle. For instance, if you have a long commute or take several extended road trips each year, then you might want to go with a traditional financing agreement. However, those who do mostly local driving might find leasing to be quite advantageous. In addition, if you have your heart set on a but have limited funds, then leasing might just be the solution you need to finally get behind the wheel without breaking the bank.
So, why is car leasing cheaper than buying? Essentially, it all comes down to the fact that you’ll only be in possession of your ride for a few years before returning it to us. For more information, Pohanka Hyundai of Capitol Heights at 240-767-6826!
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