When it's time for a new car, you have some big decisions to make. Should you buy or lease? Get a loan or pay cash? It can be overwhelming to weigh all your options. Here's a quick guide to two popular choices - financing and leasing - to help you decide what's right for your situation.
Should You Get a New Car Lease?
Leasing a car means you pay to essentially "rent" it for a few years. You return the car at the end of your lease term instead of owning it. Leasing has some advantages for Covington drivers:
- Lower monthly payments than financing since you only pay for the depreciation during your lease term, not the full price
- Getting a new car more often since typical lease terms are 2-3 years
- Driving a nicer car around Independence for less money
- Potentially lower sales tax depending on your state's laws
However, leasing isn't for everyone. Consider these drawbacks:
- Strict mileage limits - extra fees apply if you drive over
- Wear and tear restrictions - you may owe for any damage
- No equity - you won't own the car at the end to trade in
Advantages of Car Loans
Financing means you borrow money to buy the car, then make monthly payments until you pay it off. You own the vehicle once the loan gets repaid. Benefits of financing include:
- No mileage restrictions - drive around Alexandria as much as you want
- The freedom to modify or customize the car while you own it
- Building equity as you pay down the loan
- No return required at the end - you own the car free and clear
Of course, financing does come with downsides:
- Higher monthly payments since you're paying for the entire car, not just the depreciation
- Being "upside down" if the car gets totaled and insurance doesn't fully cover the loan balance
- Higher sales tax as you pay tax on the full purchase price
Visit Our Finance Center for More Information
As you can see, both financing and leasing have pros and cons. There's no one "right" option for everyone. The optimal choice depends on factors like your budget, driving needs, and plans for the car after your term ends.
Our knowledgeable finance department at Jeff Wyler Honda in Florence is here to explain all your options in depth. We want to set Cincinnati drivers up with the right plan for their unique situation. Let us help you drive home happy in your new Honda vehicle.
