Auto-Truck-SUV-Minivan Leasing (New & Used)
Is it better to lease a new vehicle or finance one? While leasing could be the best option for one person, it might not be right for another. When you lease a vehicle, you purchase the use of that vehicle for a specified period of time. At no point are you the owner of the vehicle, yet you are responsible for the vehicle's maintenance, along with your auto insurance premiums and registration costs. You're also subject to a number of conditions regarding the distance you can drive the vehicle without penalty.
Once you understand the basics of leasing you may see that it's just as simple as traditional financing. Learn the basic differences between leasing and buying.
Financing the retail purchase of a car or truck means you agree to pay for the vehicle over the life of the finance contract plus any interest on the loan. You can make a down payment or trade-in your existing vehicle to reduce the monthly payment.
There are several advantages to financing your vehicle. You can buy a new vehicle before you have cash for the entire purchase price. Your cash can remain invested or available for other purchases.
Which option is better for you?
If you know that your lifestyle includes driving well over 25,000 kilometres per year, then buying may be a better financial option for you.
Unlike a leased auto, you may change the appearance of your vehicle at any time if you own it. Whether you decide to change the interior or exterior of your car by installing new speakers or changing paint colors, you're free to alter it as often as you wish.
If you know you will subject your vehicle to rough treatment, buying could be the best option for you.
Auto Leasing
Simply put, leasing is a way of obtaining a vehicle for a defined period of time.
Why is leasing so popular today?
Cars are getting more expensive. The average person can go into "budget shock" just doing the math before buying a new car. A substantial down payment and high monthly payments make owning a new vehicle difficult.
Reasons to lease:
- A lower monthly payment than what you would pay to service a loan for the same vehicle.
- You pay tax only on the monthly payment, rather than up front on the full price of the vehicle.
- It's easier to drive a new vehicle more often (every 2-3 years).
- There's the peace of mind of knowing your vehicle is under a new car warranty.
- You have options at lease end. You can buy the vehicle, re-lease the vehicle, or use the equity as a trade-in.
- You avoid putting too much of your own money in a vehicle.
Reasons not to lease:
Leasing is not for everyone:
- The carrying cost may be higher if you lease your vehicle, even though your cash flow is better.
- If you can afford to, purchasing the vehicle will build equity quicker.
The fine print. Up front.
Paying the total price in cash is still the least expensive way to obtain a vehicle.
If you cannot pay cash, then a loan or lease with the shortest term available to you will lower the "carrying cost".
When leasing, you are only paying off the depreciation and not repaying the entire value of the vehicle.
Client FAQ
Q. Who pays for the insurance?
A. You are responsible for insuring the vehicle with the amount of coverage required by your lease.
Q. Who pays for the license and registration?
A. Lease or buy, you are responsible for licensing and registering your vehicle.
Q. Who is responsible for repairing the vehicle?
A. You will need to repair the vehicle and do regular maintenance. If you don't, you will erode your equity in the vehicle.
Q. What happens to the vehicle at the end of the lease?
A. Our Fleet Account Executive will develop a program with you that best suits your business requirements.
