what's better to buy a car or to lease it?

Question

I would like to know, what is better when you are going to buy a car, lease it or buy it? because if you lease you have the option to buy it after 3 years with 40% discount, if you buy it after 3 years the cost of the car has gone dawn probably 40% so it looks like the same, please explain me if there is a difference or not!

Answer 1

Leasing points -

1.Little money out of pocket
2.Own during factory warranty period only
3.Pay sales tax as you go on each lease payment. That means you not pay tax on the residual.
4.Not all cars are good lease vehicles. They may be good cars but they depreciate too fast to lease. (Hyundai)
5. Good for low mileage drivers
6. Never upside down - guaranteed value at lease end
regardless of market conditions
7. Option to buy at end usually not a good deal
8. Usually less out of pocket at beginning of lease. Invest the difference.

Purchasing -

1.You and the bank own it from day one.
2.Possibly lower insurance requirements (I think lease requirements are what everyone should have.)
3. Get tax credit for trade if/when you trade
4.Above average mileage drivers have no penalty
5. Usually upside down for 2/3 of loan term unless big down payment.
Two Urban Legends-
1.Dealers make more if you lease. If you are an informed buyer it makes no difference whether you buy or lease.
2. Leasing gives you more business write offs. Not true.

Answer 2

It's difficult to discuss this hypothetically without some real numbers to crunch, but if you sat down and calculated the cost of leasing vs. buying a car, I believe it's almost a given that buying is cheaper in the long run. I've known many people who've leased and every one has said that leasing and then paying off the car at the end of the lease was more expensive than if they'd simply bought it outright in the first place.

Leasing only helps you if you DON'T want to buy the car, and prefer to change cars every 2-3 years. In that case, leasing can be less costly (I won't say "cheaper" because it's definitely not cheap to do this) than buying and trading in every few years, because in the latter case you are essentially paying a mark up on two transactions (buying new & trading-in the old), whereas leasing is only a single transaction.

I would recommend you run the numbers yourself -- get some quotes on both leasing and buying a car you're looking at, and plug them into an amortization calculator. That's the only way to know for sure.

Answer 3

Well i lease my car and i traid it in every 3-4 yrs, u can always do a lease and then an early pull out instead of coming up with 1 big payment at the end of the lease. It all depends on what u wanna do, some ppl like to lease and others like to buy..... Good Luck... :)

Answer 4

It depends on if you want to get a new car every couple or few years. It also depends on how much driving you do. Don't lease a car if you drive alot b/c if you put over a certain amount of miles on a leased car you will have to pay extra. I would lease a car if I barely had to drive.

Answer 5

Car dealers make mega profits from leasing agreements so obviously buying the car would be better for the consumer.
One of my dad's friends has a dealership and back in the early '90's he was bragging about the cash he was raking in from leasing agreements. They made him very wealthy.

Answer 6

If you want to buy the car, just buy it. Leasing is good if you want the car, but are going to end up selling it in a few years if you bought it.

Answer 7

I think buy it better