Last week, we talked about the factors to consider when deciding if you should buy a new or used car. This week, we’re assuming the decision was for a new car. Now you face another question: lease or buy the new car? There are many things to consider when deciding to lease or buy a new car in Wisconsin or Minnesota. The correct answer will be different depending on your situation. Use the following tips to help decide which choice is best for you.
Leasing
Pros of leasing a new car:
- Lower payments – you’re not paying for the whole car.
- Lower to no down payment.
- Walk away clean. Drop the car off at the dealer when the lease ends, and pick up a brand new lease the same day.
- The bumper-to-bumper warranty remains intact for the entire period of the lease.
- You always have the newest and safest technology.
Cons of leasing a new car:
- Limited annual mileage is the biggest drawback.
- You’re not allowed to make additions or alterations.
- You never earn equity in the car, and you never escape from monthly car payments.
- The financing company requires full coverage insurance, which can be expensive. Of course, at Baldwin Woodville, we will help you get the best deal possible when you lease a new car in Wisconsin or Minnesota.
Buying
Pros of Buying a New Car:
- Once the last payment is paid, you own the car, with no further payments.
- There are no mileage or alteration restrictions.
- You gain equity in the vehicle, and have something of value at the end of the loan period.
- Once the loan period is over, you can adjust the insurance to fit your needs and save money. Contact your Baldwin Woodville agent to find the best balance between your needs and your wallet.
Cons of Buying a New Car:
- The vehicle loses its value as you drive it off the lot.
- A large down payment is typically required, up to 20%.
- Your car will outlive the warranty, and you will be out of pocket for anything that insurance doesn’t cover.
- Unless you have an enormous down payment, you will face larger monthly payments, because you’re paying for the full price of the car, including all interest, taxes, and fees.
Consider these facts as you decide whether to buy or lease your new car. And as always, your Baldwin Woodville agent is always available to talk with you about how these factors affect you and your personal circumstances.