5/5

BASED ON 700+ REVIEWS

2737 Coney Island Ave, Brooklyn, NY 11235 United States
GRAND PRIX MOTORS, INC IS NOT A LICENSED NEW MOTOR VEHICLE DEALER. GRAND PRIX MOTORS INC, IS AN AUTOMOBILE BROKERAGE FIRM AND A USED CAR DEALERSHIP LICENSED AND BONDED IN THE STATE OF NEW YORK. FACILITY ID NO. 7124382. NO WARRANTY REPAIR SERVICES WILL BE PROVIDED. ALL NEW BROKERED VEHICLES ARE COVERED BY MANUFACTURER WARRANTY. GRAND PRIX MOTORS, INC DOES NOT CHARGE ANY FEES FOR ITS SERVICES.

WHAT IS BETTER LEASING OR BUYING A CAR?

Your car is an indispensable part of your day-to-day life. Whether you’re driving kids to school, commuting to work, or getting away for the weekend, you need a car. If you are shopping for a vehicle in New York, you definitely want to know what is better leasing or buying a car. Main distinctions have to do with what exactly you pay for, and what responsibilities or obligations you bear. First things first you should have a brief overview of your income and estimate the monthly budget you can afford. You can take advantage of an exclusive buy back program and make some money for your next lease! It is very important as we will unveil the clear financial difference between a lease or finance a car. A short guide from Ford can be of help. 

Lease or Finance a Car? 

The main difference between these two options lies in the question of commitment. When you take a loan for 5 or 7 years, you finance the auto to own it at the end. You pay for the whole thing, usually according to the selling price on the market. At the same time, you gain responsibility in terms of repairs, trading-in, or selling the car when you no longer need it.

When you lease a car, you only pay for the depreciation for the time you drive one. So the cost of monthly payments for the same car compared to financing will be lower. Typically, you get a brand new model with the latest safety and performance features. This new auto runs its first trouble-free years and after that, you choose what to do next. Normally, you may whether return it to the company or buy your car out for the residual value stated in the agreement in the first place.

How does leasing work?

Leasing may be described as renting a car for an extended period. You pay for the amount of depreciation that is expected to grow during the term of the lease, plus interest and fees. The cost of the lease is the capitalized cost minus the residual value, plus interest (the money factor) and several fees. You can also calculate your deal to get an approximate estimation of your next car.

At our UNDERSTANDING CAR LEASING TERMS we covered the main vocabulary difficulties you might face while researching. As for the maintenance responsibility, lease agreement typically provides warranty and a particular coverage.

lease or finance a car

You get your new car to drive in the first trouble-free years and you basically take care of oil and tire maintenance. At the end of your lease contract, you will have the wear and tear check and return the car back to the company. After that, you have full freedom of choice. You can buy the auto or get the newer one on your next lease.  

What is the difference between leasing and financing?

In the case of financing a car, you get desirable ownership at the end of the payments. It will require larger financial matters and a strong credit score for the vehicle loan. If you enjoy mechanics and modifying a car, purchasing an auto will give you this opportunity. You will be responsible for any damage and cover the maintenance issues yourself. Another thing is that your mileage amount will not be restricted. So you don’t stick to yearly restrictions and drive the car as much as you want. At the same time “tear and wear” is completely on you. So when it’s time for you to sell and trade your car you will have to deal with depreciation issues. There are many disadvantages in terms of lease or finance a car. Let’s look into the benefits.

What are the advantages of leasing and financing?

Leasing

Financing

  • You will make lower monthly payments
  • No down payment required unless you agree otherwise
  • You always drive a brand new car
  • No hassle with selling and market fluctuations
  • Repair costs are insignificant as you get a warranty
  • You can change a car every few years
  • You own a car when it’s paid off and get equity
  • Mileage restrictions don’t limit you
  • You can save your money in the long term
  • There is an ability to customize or modify your vehicle
  • You can sell or trade-in your auto anytime

What about the numbers?

The conditions of lease vs buy car options definitely have some strong benefits. But usually, numbers speak louder than words. Let’s say you’ve found the perfect Mercedes-Benz SUV. It has an approximate capitalized cost of $50,000. After three years of use the residual value might drop to $30,000. To lease the luxury SUV, you’ll have to pay the depreciation of this period. It is is going to be about $20,000, plus interest and fees. If we take the probable amount of upfront payment, roughly $3,000 plus fees, the remaining $17,000, plus interest, is split into a series of equal monthly payments. When you make your final payment, you will return the vehicle to the dealership and have other hassles.

By contrast, the financing deal will include the estimated selling price of about $50 000. Add the interest rate, additional fees, and taxes. If you are going to pay off the loan for the same three years, the lease monthly payment is going to be almost three times cheaper. Monthly costs differ so much because financing the car means buying the vehicle for the total cost. By contrast, by leasing a car you only pay for the depreciation.

Leasing or buying a car: what is better for you?

The bottom line is that everything depends on your long-term intentions. Whether or not you want to lease or finance your car, you need to analyze your lifestyle and preferences. 

If you’re the type of person that likes to have new cars every few years, then leasing makes much more sense financially. However, if you intend to buy a car and use it until it dies then taking out a loan is your better option. In between, it all depends on the level of financial commitment and ownership you prefer to have of your car.

It is very important to choose wisely and be careful of your priorities. We respect your choice and if you still have questions, our lease expert will answer any of them shortly to help you make the right decision. 

Grand Prix Motors is a full-service leasing company that offers a wide range of services and we pride ourselves to deliver the best experience for our dear customers. Whether you are aiming to lease or finance, we are going to take care of all the hassle and make your leasing or buying journey transparent, convenient, and simple with our trusted company.

For more information, see our latest article on Leasing vs Buying in 2022.

#enjoy your freedom with Grand Prix Motors!

Related articles

Sign up to our newsletter.

Hear about the latest offers first, before everyone else.

Get you Free Quote on any Make & Model!

Submit your desired Car and we will contact you shortly.

    X

    GET YOUR FREE QUOTE OR ASK US ANYTHING!

    Request Custom Quote