Evans Kia Buying vs. Leasing Advice

Buying vs. Leasing a Car

Understanding the differences between buying and leasing is key to making an informed vehicle purchasing decision that makes the most sense for your finances, lifestyle, driving routine, and personal preferences.

The following compares the pros and cons of buying and leasing, the economics of each, and why you might choose to finance one way or another.

BUYING

Getting Your Own Car

When you buy a car, you have a choice: you can pay for it all at once with cash, or you can make monthly payments if you finance it. Either way, the car becomes yours.

If you decide to finance, you'll have to meet certain obligations set by the lender, like making a down payment and paying your monthly bill on time. If you don't, they could take back the car.

Most people don't have all the money upfront, so they finance through a dealership, bank, credit union, or private lender. You'll pay back the loan, plus interest, over a few years.

The lender will check your income, credit score, and the car's cost to decide how much interest you'll pay and how long you'll have to pay it off. After signing some paperwork, the car is yours!

Paying Upfront

If you finance, the bank might ask for a down payment to make sure you're serious. It's usually 10% to 20% of the car's price and helps lower your monthly payments.

You can also trade in another car and use its value towards your down payment. The amount depends on the lender's rules and your credit score.

Thinking About the Future

Cars lose value over time. In the first year, they can lose almost 20% of their value! The amount they lose depends on their make, model, year, and market value.

Even though cars lose value, buying one can still help you build equity. Just make sure you're paying off the loan faster than the car's value is dropping. You can use this equity to help buy your next car.

Your car will be worth whatever someone is willing to pay for it when you sell it later on. Taking care of it with regular maintenance can help keep its value up!

Payoff Day

Once you've paid off your loan, the car is officially yours! The lender will send you a paper saying they no longer have a claim on your car, and it's all yours to enjoy.

LEASING

Understanding Leasing

When you lease a car, you're not buying it. Instead, you're paying to use it for a set time. The finance company that you lease from actually owns the car. That's why lease payments are usually lower than buying.

Leasing also shields you from unexpected drops in value. If the car's value drops due to something like a recall, it's not your problem like it would be if you owned the car.

Getting Started

Leases usually don't need a down payment. You typically just pay the first month's payment, a security deposit, fees, and taxes. But if you want to lower your monthly payments, you can pay more upfront, just like with buying.

Looking Ahead

In most leases, you don't keep the car. You won't have to worry about selling it because that's the finance company's job. But you might have mileage limits and rules about wear and tear. If you go over these, it could cost you extra when you return the car.

Lease terms are usually two to three years, which is good if you like driving new cars often. Leasing might also let you afford a nicer car for less money compared to buying.

End of the Road

When the lease ends, most people give the car back. Some might want to buy it during the lease or at the end, or trade it in early. Talk to us about your options before you sign anything, and we'll make sure your lease fits what you want.

Choosing the Right Car

The best cars to lease are ones that keep their value well. Since they lose less value, your payments are lower. Look at lease ratings to find cars that hold their value over time.

Choosing Between Buying and Leasing

Deciding whether to buy or lease a car can feel like a big decision. But don't worry, you're not alone! If you're unsure which route to take, a visit to your local car dealership can help clear things up. They'll chat with you about your preferences and budget, and together, you can figure out the best option for you.

Here at Evans Kia, our finance center is here to support you every step of the way. Whether you're eyeing a shiny new Ford or a reliable used car, we've got leasing and financing options to suit your needs. If you're eager to hit the road in your next vehicle, reach out to us online and let's get started!