Auto Insurance: Is it Better to Lease a Car or Buy a New One?

When the time comes to get a new car, there are many options. In fact, the options can be quite overwhelming for some. You could lease a car, though you may also decide to buy a new or used car. While some of these are personal decisions that you need to make, there are some good reasons for each.

Here are some reasons to lease a car.

• Lower monthly payments. It usually costs less to lease a car than it would be to buy it. Even better, you don’t have to pay any sales tax upfront.
• Won’t feel “upside-down.” There are times when you may feel like you are “upside-down” in your loan because you may owe more than the car is worth. You can’t sell it because you will be losing money so you just keep the car. This doesn’t happen with a leased vehicle.
• No loan, so credit isn’t as important. If your credit is keeping you out of a nice car, you may have better luck leasing one that you like. You won’t need stellar credit to lease a car.
• New cars. When you lease a car for a few years, you can always upgrade for your next car. This means that you will always be driving cars that are fairly new, compared to what you may be able to afford with a loan.

Here are some reasons to buy a new car.  

• Avoid extra costs with leasing. There are extra costs to leasing a car, that you may not realize. These include mileage if you drive the car more than it was expected or you return it with damages. You may also get extra charges if you terminate your lease early.
• Freedom. For many, they want the freedom to do what they want with the vehicle. They can drive it as much as they want. If they accidentally bump something, they don’t have to worry about the repercussions.
• Equity. As you pay off your new car, you are building up equity in it. You can use this toward your next vehicle when you decide to sell this one and buy a different one.

Here are some reasons to buy a used car.

• Less money. It costs less to buy a used car than it would be to buy it brand new. In fact, many say that a vehicle loses between twenty and forty percent of its value within a few years. Many people can’t afford to buy brand new cars.
• Less worry. Many don’t want a brand new car because they worry about messing it up. They are afraid to do anything around it (or drive it) because they don’t want to ding it or bump something with it. If you buy a truck to use, you will be able to fill the back up without worrying about it.
• No monthly payments. Once your loan is paid off (or if you were able to buy a used car without needing a loan), you won’t have to worry about the monthly payments. It is a very nice feeling when you don’t have a monthly car payment.

If you don’t want a huge monthly payment, you may want to lease a vehicle. It also allows you to try out new vehicles every few years. In fact, you could drive a brand new car almost every year! However, others prefer to buy a vehicle because they can do whatever they want to with it. There are no restrictions because they own it. That being said, many people can’t afford to buy brand new cars. They prefer to buy ones that are a few years older so they feel like they can get a better deal!

Contact us for all of your insurance needs.