In the long run, is it better to lease than to buy?

Question

My perspective was that as long as you're just gonna drive around in your city and not thinking of doing a coast to coast road trip every year then it is by far better to lease a car than to buy one.
Any advise? I'm thinking with the gas prices up, I might as well lease a Hybrid and save some money. THis way no maintenance AND less gas fees.

Answer 1

Leasing allows you to switch cars every two years or so depending on your contract. However, there are some pro and cons. If you lease a car, you better not have any scratches or damages to it or you will have to pay big time.

Answer 2

Just note that if you're looking at a hybrid, the US federal income tax credits only go to the purchasers of new hybrids. Not used. And if leased new, the credit goes to the leasing company, and not to you.
http://www.irs.gov/newsroom/article/0,,id=157557,00.html
http://www.irs.gov/newsroom/article/0,,id=157632,00.html

On a leased vehicle, you still have to pay for maintenance. (Some leasing companies will fine you if you do not get the scheduled maintenances done!) Sometimes, the leasing company will bundle a prepaid maintenance plan into the main lease, so you just may not realize that you are paying for it. (You can also get the prepaid maintenance plans if you buy the car, too...)

Whether it is better to lease or buy, depends on your individual situation. Some online guides:
http://magazines.ivillage.com/goodhousekeeping/consumer/cars/articles/0,12873,284541_290034,00.html
http://www.leaseguide.com/lease03.htm
http://www.bankrate.com/brm/auto-advisers/br_buyvlease.asp
http://www.learner.org/exhibits/dailymath/car/


Good luck!

Answer 3

Find a lease with an extremely low interest rate (0 to 3%). The best part about a lease is that if you are upside-down at the end you can just walk away. If you are in an equity position, you can sell, trade or keep the vehicle.

Answer 4

If you are "cash poor", leasing is a lot more attractive. If you have enough money to pay for a vehicle without financing, the question gets more complicated. The truth is that leasing a car is complicated and if you don't work hard you might not be getting a good deal. I advise studying leasing before making the jump. All leases are not created equal.

Answer 5

Uhh, you still pay for maintenance, even when you lease. Most will offer that for a big fee. Is much better to own than lease in the long run...When you lease, and when the contract is about to mature, they offer you to buy the car, and yet still pay it at brand new price, even though, it may not be worth half that much when your contract is up. Hope that made some sense. Good luck.

Answer 6

If your car is a business expense and therefor deductible, leasing may be the way to go. Expenses come right off your income before taxes.
If you use it mostly for personal use and keep your cars in good shape, owning is a lot cheaper over the long run.
So it finally comes down to your financial situation, if you have enough money to blow, then leasing can be the more comfortable way to go even for private use..

Answer 7

depends on the number of miles you drive a year. And just "driving around town" will rack up more miles than you think a lot quicker than you think. Be careful about leases because some of them don't take normal wear and tear into consideration when turning it back in and can cost you hundreds or even thousands of dollars to turn it back in

Answer 8

No..leasing costs more and is more restrictive..

its better to buy..leasing the car isnt yours..your renting it...buying it is..
leasing has lots of restrictions(you have to maintain the car, no modifications..so many miles a month/year)..buying obviously doesnt have any..

if you lease you better not let one dent or scratch happen to it either..otherwise you'll have to pay out the *** for repairs..also i think insurance is higher.

Answer 9

well now! i think before buying a car one sud lease the car they want to buy and if they like it they buy it so its kindda test run sortta aswell! and i wud always get a rental if i am going coast to coast rather have that mileage up my meter!!! :)...

Answer 10

pros - no real attachment to the car itself, no maintenance fees few minor ones aside) get to switch cars every couple of years, no "heavy" car payments to deal with, and somewhat more ecnomical

cons - you're making someone else rich and not adding to your "net worth", will get slammed with mileage infraction should you exceed your agreed contract, will pay more in repair costs should an accident be involved.