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Vehicle leasing – The Pros & Cons

Leasing a car instead of buying one has its advantages as well as disadvantages. Leases usually last for between 2 and 4 years depending on the contract and the company. So what are the pros and cons of leasing a car?

Pros

Finances are one of the best reasons for leasing a car. A leaser never has to get a large lump sum together to purchase a new car. Instead they just have a monthly fee to pay and when the rental is up, they just have to change the car for a newer model, without the hassle of selling at a loss. This is a huge pro for leasing a car.

Drivers are always covered by a warranty when they lease a car. They have a car until the end of a warranty period and then just change to another vehicle with a full warranty on it. This means you need never pay for repairs or have any issues with breakdown which you have to put your hand in your pocket for.

Monthly costs are also predictable with a leased car. These are generally far lower than for that of a hire purchase or bank repayments. This can making renting a car a far better option than buying, especially if you run from one lease to the next. For a Mercedes or a Volvo lease it may give people the chance to own a premium brand they wouldn’t have otherwise been able to afford.

Cons

One of the most obvious downsides of leasing a car is that like anything you lease you will never actually own the car. The only way to own the car is to buy it at the end of the leasing period; this isn’t always an available option as not all car leasing deals allow this.

Within many lease contracts you can only do a set amount of miles, if you go above this you may have to pay an extra charge, which can be quite costly. Leasing cars is also more costly long term if you don’t wish to have a new car every few years. Drivers who find they like to stick with a car for a prolonged period will see leasing as a more costly option.

One of the most crucial things you will have to do when leasing a car is to pay attention to the terms and conditions. Stipulations such as mileage allowed will be laid out in the terms and conditions.

Conclusion

Leasing has both its advantages and disadvantages; whether it would suit you depends on your requirements for a vehicle. If you are the type of person who likes to have a new car every few years without any hassle leasing is definitely the way to go. For those that don’t like change and are happy to keep their car for a number of years or those that clock up a number of miles leasing probably isn’t the best option.

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2 comments

  1. Keep in mind, You also don’t own your car when you finance a car, the bank owns it. http://www.hoopdi.com/guide/index.php/Leasing-Information/Lease-vs.-Financing.html
    And of course, the warranty is unrelated to the lease. For example, you can lease a Mercedes for 5 years and the warranty will be in effect for for only 4 years.

  2. Very nice and informative blog.Lease rentals are considered as an operating cost, which means that it is often possible to deduct them from taxable profits (as a trading expense). However, you should always check that the equipment you are buying is eligible before agreeing to a contract.

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