Every years thousands of people from across the Edmonton and Leduc area search for the most cost-effective way to get behind the wheel of their next car, truck, or SUV. Two of the best methods are loans and leasing – but which works best for you?
Today Go Auto Outlet is going to break down the differences between these two so you can make an informed decision the next time you’re looking for a new vehicle!
If you intend on actually owning the prospective vehicle for an extended period of time, then a car loan is the best method for you! That’s because with a car loan you intend on owning the vehicle, but rather than paying it off in one lump sum, you pay the vehicle off in monthly payments instead. Most companies will also charge a small interest rate in addition to the monthly sum, so paying off the car loan in an expedient manner is typically for the best.
Leasing is fundamentally different in that you don’t intend on owning the vehicle, instead you pay for the privilege of driving it for an extended period of time. Think of it as renting – only instead of renting for a period of days you are potentially renting the vehicle for years. Most leasing options last two to three years and are only available on new vehicles. Just like a loan however, you can expect to be charged a small interest fee in addition to the monthly payments.
Which is Best?
Which path you choose, loaning or leasing, ultimately depends on how long you intend on owning the vehicle, and what you intend on doing with it afterwards. A vehicle lease is cheaper in the short term, but since you do not technically own the vehicle you can’t sell it or modify it. A car loan is better in the long term as you actually own the vehicle and therefore can sell it or modify it to your heart’s content!
So there you go, now you can make a better decision when it comes to loans vs. leasing! For other frequently asked financial questions, visit our F.A.Q.’s page. You can use our Car Loan Calculator to find out exactly how much you payments will be! Go Auto Outlet is always happy to help people find their next car, truck, or SUV!