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Car dealershipsDeciding whether to lease or finance a car will depend on your needs, total mileage driven per year and personal financial circumstances. Leasing a vehicle costs less initially, and requires no down payment or trade-in. Financing a car, (or buying to own the car), requires a substantial down payment and/or a trade-in of your old car, excellent credit history, obtaining a loan from a finance company, and making monthly payments for the term of the loan. -
Car LoanYou can buy a car that you will eventually own by negotiating for a ''loan'' with a finance company, for both the term of the loan and monthly payments that are affordable. Financing puts all responsibilities for the care and servicing of the car upon you after the new car warranty on the car has expired. Car maintenance, repairs, insurance, tire replacements and exterior scratches and dents are paid by you, (including the monthly car payments), until the expiration date of the loan. At this time you will receive the title, and be the owner of the car--without making further car payments--until you decide to trade it in for a newer model. -
You should lease a car if you do not have a down payment for a new car, cannot afford the cost of auto insurance, or if being an ''owner'' of a car is not important to you. If you do not drive much (maintaining low mileage), like to drive a late model car each year, prefer to have a fully paid for warranty on the interior and exterior of the car, then leasing might be just for you. While leasing a car will cost less initially, it will cost significantly more in the end, or at the termination of the lease. Excessive mileage, body dents or scratches or even the tiniest nick in the paint will be your financial responsibility for all repairs and/or repainting.
