Leasing Versus Financing
What’s the Best Way to Own a Car?
Leasing or financing a car can be a confusing topic for consumers. Read on to take the confusion and fear out of this important discussion. Leasing has provided tremendous benefits for thousands of our customers; however, everybody has different financial and driving requirements!
WHO OWNS IT
You do not own the car when you lease. You’re paying for the use of the vehicle, but the finance institution that you leased it through actually owns it. This is usually why you pay less per month in a lease than if you were to buy the car.
Leases often do not require any type of a down payment. All you usually have to pay is the first month’s payment, a security deposit, the acquisition fee and other fees and taxes. But, as with a purchase, if you want to lower your monthly payments you can always pay more upfront.
In most leases, you don’t end up owning it so you don’t end up selling it. That’s the financial institution’s job. Although you may have mileage limits and wear and tear guidelines that, if you exceed them, could cost you extra money when you turn your vehicle back in.
END OF PAYMENTS
Most people return the vehicle at the end of the lease term. But some like to purchase it during their lease or at the end. Others like to trade it in before their lease is over. Just ask us about these different options before signing any paperwork and we’ll make sure you have your lease set up the way you want it.
BEST CARS TO LEASE
The best cars to lease are those with the best book value after the term of the lease. Since they depreciate less, you pay less. Review Honda residual values, depreciation costs and lease ratings to see how great they retain their value.
WHO OWNS IT
Whether you pay for the car with cash, or finance it and make monthly payments, either way, it’s yours. Of course, if you’re financing it, you’ll have to meet the obligations the lender requires, like a certain down payment amount and timely monthly payments. If you don’t, they have the right to repossess it.
If you’re financing it, the bank will probably request a down payment. You can also trade-in another vehicle and use any equity towards your down payment. The amount of the down
payment is usually based on the lender’s
requirements and your credit score.
Your vehicle will be worth whatever you can sell it for in the future and that depends on how well you maintain it. (Be smart and protect your investment with regularly scheduled maintenance by a factory-authorized facility!)
END OF PAYMENTS
Once you’ve paid off what you owe on your contract, that’s it. Your vehicle is 100% yours. The lending institution will send you a Lien Release as proof that the vehicle is completely paid off and all yours.
BEST CARS TO FINANCE
The best cars to finance or buy are those with the lowest cost of ownership. Since every car you buy will depreciate, you want to make sure that they still hold strong market value. Review Honda depreciations costs and lowest cost of ownership ratings to see how great they retain their value.