When you’re looking for a new set of wheels in Marshall, MO, you have a choice between buying and leasing. But which option is best for your situation? Below are some things to consider before committing to leasing or financing a new car.
Pros of Leasing New Cars
- It’s Financially Friendly: Because you’re not paying interest on a loan, your monthly payments are lower than buying. You’re only paying for the depreciation cost of the vehicle.
- You Get a Newer Model Every Few Years: You can lease a new car for anywhere from one to five years, and that includes all the latest gizmos and gadgets.
- Maintenance is Worry-Free: Maintaining a leased vehicle is both free of hassles and easy on your wallet. Its repairs are generally covered by a warranty and can sometimes even include free scheduled maintenance and oil changes. Ask someone from our Marshall GM dealership for details on maintenance packages for leased cars.
- You Get More Bang for Your Buck: Because your payments are lower than buying, you can choose a more expensive car with better features.
- You Don’t Have to Deal with Haggling: When you are ready to trade a lease in for another car, you don’t have to worry about haggling over the sale price, nor do you have to factor in the vehicle’s trade-in value.
- You Get a Possible Tax Break: If you’re a business owner, you could write off those monthly commercial fleet lease payments on your taxes as a business expense.
- The Vehicle is Easy to Get Rid Of: When you lease a car and want to move on, you don’t have to deal with the headache of selling it to the dealership or a third party (and for much less than you paid, to boot). You just drop it off at the dealer and say good-bye.
Cons of Leasing Cars
- It May Not Be Financially Feasible in the Long Run: When you lease a vehicle, you’re committed to a depreciated asset for a certain length of time. Once your car lease has concluded, you’re left without a vehicle, and you’ll need to negotiate a plan to retain the leased car, or have a down payment prepared to secure another vehicle purchase or lease.That financial disadvantage comes in another form, too. Leasing contracts restrict your mileage in the contract. If you exceed the designated number of miles, you end up paying a penalty for each mile you go over. Conversely, you’re not credited for coming in under the mileage limit.
- More Potential Financial Penalties: Not only do you have to be careful not to exceed your mileage limit, but you also must keep the leased vehicle unmodified and in good shape. Excessive dents or wear and tear can translate to financial penalties. If you want to trade in your leased vehicle early, you may be penalized with early-termination fees that could exceed the original amount of the leasing contract.
Pros of Buying a New Car
- You Only Have a Limited Financial Commitment: Once you finish paying off your vehicle, that’s it for your commitment of monthly payments. When you complete those payments, you own the car free and clear.
- You Get Unlimited Mileage: When you buy a vehicle, you don’t have to worry about paying penalties or fees for driving a hefty number of miles each year. This is great if you travel from Warrensburg to Moberly each day for work, live in a rural area, or enjoy taking road trips far away from Marshall, MO. You can hit the road as often as you want with no worries.
- You Don’t Have Extra Fees: If you put excessive wear on your vehicle, you don’t have to worry about doling out extra dollars in fees. Living with the damage done is up to you.
- You Can Modify the Car: Since you’ll be owning the car after your auto loan is paid off, you can modify it as much or little as you wish. Attract eyes with a unique paint job or install aftermarket accessories and parts to boost its performance. It’s up to you!
- Equity: Because you’re paying to own the vehicle, you’re able to sell it whenever the market dictates a high sale price. That’s instant equity.
Cons of Buying New Vehicles
- The Cost is Higher: The upfront cost of buying a vehicle is more expensive than leasing. The purchase price is higher, which influences a higher interest rate for the car loan. Add on sales tax, and you may be paying quite a bit more to lease the car than you would to buy it. That investment can also involve laying down a significant down payment, which could be as much as 20% of the cost.
- Your Investment Depreciates: The value of a vehicle begins going down when you drive it off the lot. So, when you’re ready to trade it in or sell it, you get back a fraction of your initial investment, if any at all. It all depends on what the market value is.
- You’re Responsible for the Maintenance: Once your vehicle’s warranty expires, the cost of repairs, preventative auto maintenance, and oil changes fall solely upon the owner. If you need a pricey car repair, you’ll be paying out of pocket.
Your needs are your own. Considering these points when weighing your options should help you make the right decision. No matter what you decide, you can bet on our Marshall car dealership to have the prices and vehicles that fit within your budget. At McCarthy Chevrolet Buick GMC, we have an extensive inventory of new GM vehicles and used cars for sale in Marshall, MO, as well as friendly auto finance professionals to help answer any questions you may have.
Contact us (660) 530-4624 or pay our dealership a visit at 1550 W Arrow St to get pre-approved for a car loan or discover your GM lease options.