As discussed in many previous articles, the question of whether car leasing is better than car buying seems to generate passionate discussion with people putting forward good arguments at both ends of the spectrum. However, like anything the answer to “what is best?” depends on the car shopper’s needs and wants. This article is one of a series of articles looking at this and the following outlines some of the advantages of car leasing to help a car shopper make the correct decision according to their circumstances.
Car Leasing Advantage 1 – Avoid Depreciation
The AA has stated that after 3 years the average car will have lost around 60% of its value with as much as 40% of the value disappearing in as little as 12 months – and that is if the car does no more than 10,000 miles per year! Leasing a contract car can protect a motorist from the negative effects of depreciation because they only have the car for a short period (typically 3 years) after which they get a new car. It is the owner of the car that has seen the value of their car drop an average of 60% in the time that the motorist had possession of the car. Alternatively, if in the rare event the value of the car has not depreciated as much as expected, some leasing contracts (such as personal contract purchase or PCP) allow the lessee the option to buy the car.
Car Leasing Advantage 2 – Cheaper Form of Finance For Expensive Cars
For cars that don’t depreciate as fast as the average vehicle (eg; Audi, BMW, Mini) monthly payments to have possession of the car can be as much as 60% cheaper than a personal/business loan. Of course, it should be noted that if someone uses a loan to buy a car, at the end of the loan period the driver will own the car outright – but they will have also suffered the cost of depreciation in their high monthly payment.
Car Leasing Advantage 3 – Convenience
Provided the motorist knows exactly what they want, with car leasing they can apply for the lease contract online or from a dealer and once approved the car is delivered to their door. The new car normally has road tax included and is covered for typically 3 years by the manufacturer’s warranty. Once the leasing contract finishes (normally 3, 4 or 5 years) the lessee of the car can return it and exchange it for a new model (or buy it – depending on the contract). Therefore, the motorist can avoid the complications that inevitably come with selling a vehicle (eg; advertising, haggling, transfer of ownership etc).
To compare the benefits of car leasing with the benefits of buying and to get car finance prices for either option you can use a helpful tool that gives instant comparison of car finance for all cars on www.FinanceAcar.co.uk