According to the Q1 WalletHub report about the auto financing industry, leasing deals with traditional car manufacturers lack transparency. This is echoed by the fact that auto brokers are consistently able to negotiate superior rates for consumers.
The WalletHub concludes that the timing is especially right for leasing vs. purchasing a new car. Consumers are recommended to avoid National banks (2 percent above average), and regional banks (29 percent above average) as financing options.
In general, there are many things to think about before getting a new or pre-owned car. You’ll want to ponder your preferred color, the make and model, and whether to lease a car or buy one. There are numerous advantages associated with the former option.
Less Money Required Up Front
Although many people need cars to fully thrive in their daily lives, they often find it difficult to budget for the respective costs. After all, the purchase price is only one cost that occurs at the beginning of the car ownership process. You also have to budget for numerous ongoing vehicle costs. Some expenses, such as taxes, depreciation, and interest typically go down over time. There are others, such as fuel, service appointments, and repairs, you’ll have to pay for as long as you own your vehicle.
A major advantage of leasing is that compared to buying a car in full on the day of the sale, you’ll usually get to enjoy a very low down payment or even have the down payment waived if the dealership categorizes you as a well-qualified lease candidate. Furthermore, the monthly payments are likely less than what you would pay if you were in the middle of upholding a loan arrangement you had to get from your bank to pay for a purchased car.
Switch to Newer Models Frequently If Desired
As someone who is leasing a car, you’ll typically have the option of trading for a newer model once you have fulfilled your lease agreement. Many lease agreements are three years in duration, but other options exist if you need more time to pay. No matter what, once you have paid for the car in full, you’ll usually either have the option of embracing the fact that you now own it or trading up for a more current model.
Trading up offers a good opportunity to always be able to tap into some of the latest automotive technologies. For example, maybe keeping your family safe while on the road is a constant priority and you’re particularly fascinated by the autonomous driver-safety features that scan the road and surrounding environment for possible hazards and make the car react accordingly before drivers can even notice things might be amiss.
If you purchase a car and ultimately decide you’re ready for an upgrade within a few years of buying it, you may be on your own as far as selling the model you have first before you can start to browse newer possibilities. There are some exceptions, such as if you have chosen to do business with a dealership that offers maximum payouts for all trade-in models regardless of manufacturer. However, people who are part of lease agreements frequently have even more flexibility when it comes to trade-in options.
Tap Into Tools and Promotions Specifically for People Who Want to Lease
Most dealerships have sections of their websites that cater to individuals who already know they want to lease cars or have nearly reached that conclusion. They might feature pages filled with current lease specials that include helpful filters that aid in making quick comparisons between certain promotional offers of interest.
It’s also common to find online automotive lease payment calculators These tools allow you to input the estimated total cost of a vehicle you want to lease, set parameters such as your budget and lease length, and receive an estimated monthly payment. Once you have that information, it’s much easier to determine if you can truly afford to get involved in a lease agreement.
By its nature, a lease agreement spreads the total cost of a car out so it’s easier for people on tighter budgets to manage without feeling too stressed. After working with tools including lease payment calculators, you may find it’s even easier than you initially thought to buy the car you’ve always wanted by agreeing to begin a lease.
Automotive websites also often have dedicated sections about lease terms and procedures people should follow once they have reached the end of their lease agreement. Those parts are also worth looking at if you’re considering starting a lease.
Hopefully, you now have fewer fears and less uncertainty about making your next car more accessible through a lease agreement. This option is one that many car enthusiasts depend on to meet their goals and you can too.