Content

• Steps
• Tips
• Warnings

Leasing allows you to purchase a more expensive or newer car than you could possibly buy. All other things being equal, the long-term financial contribution will be approximately the same as with a monthly payment for a short-term lease. If you plan on making a monthly payment, consider what you are paying for and how much. It might make more sense to make a payment for a new car on a monthly basis than a similar payment for a used vehicle.

Steps

1. 1 Consider the trading cycle. Most likely, you will use the next car for about the same as the previous one.If it's a long term, five or more years, consider buying. You will usually pay less per year this way. On the other hand, if you want to experience the very latest models, leasing can be cheaper and easier than buying and selling cars every 2-3 years. If you intend to use your car as a work car and you are likely to damage your car, consider a commercial rental. Your accountant can provide several advantages in paying taxes under this option.
2. 2 Estimate how much you can spend on a down payment when you buy, and how much you can spend per month with monthly payments. NEVER place a down payment on your rent, just to keep your monthly payment down, only pay the true administration fees.
3. 3 Some types of leasing may allow you to spend less monthly than buying. However, you will probably pay more for the year on a long-term purchase, since you pay for all of the depreciation. See the bottom line for both options.
4. 4 Review all payments and basic expenses and find out the full cost before making a choice.
5. 5 The time frame, options and next purchase should take into account your decision. Either way, it's okay to spend a lot, as long as you get what you want.
6. 6 To save money in the long run, consider buying or renting a car that is simply not new. If it's treated well, you can pay less and use it for a long time. Used cars also tend to be cheaper with insurance.
7. 7 Leasing allows you to have a better car now than you could buy for the same price. It is often best to just buy a car that you can afford. When you sell your car, you get the opportunity to save the remaining "capital" and apply it as a down payment on a new car.
8. 8 Determine the mileage that you expect to drive your car as long as you own it over the next 2-3 years. Make sure mileage is included in the rental price. If you rent a car to a dealer, he will have no arguments as to the value of the car or to your rights to potential capital. If the car has "capital" - it's your money when you choose it.
9. 9 If the market price is less than the final rental value, then let the landlord take it for himself. You would pay more if they knew the price was lower. In this case, you win! If you buy it, you will lose.
10. 10 If you are thinking of buying a used car, your warranty may be expiring or nearing expiration, so ask for an extended service contract.

Tips

• Both leasing and buying have their advantages and disadvantages. Check with your loan officer or seek advice from an accountant.
• More and more people are using cars for business purposes. If you are also, consult your tax collector for the "best strategy".

Warnings

• Even the slightest damage to your vehicle (sometimes even minor cosmetic scratches) must be repaired at your expense by the end of the rental. However, any defect noticed by the appraiser will cost the owner money. The difference between normal wear and tear and non-standard damage is always visible to the eyes of the person desiring a subsequent sale.
• When renting, there are mileage conditions and costs are paid for the excess mileage. This can be a problem for those who spend a lot of time traveling or who have a long commute, so remember, no matter who owns the car at the end of the purchase or lease, the car has the same value. Many renters have a fixed annual mileage and require the renter to pay a fee per mile above a set number at the end of the lease or on an annualized basis if the lease has expired recently.Some companies offer a cash discount if you rent a car with high mileage and return less than the mileage limit.
• If the car is stolen, you will be financially responsible for a balance of payments equal to the residual value of the lease. Many rental providers include "interim protection" that covers the difference between how much you owe and how much it costs. Some renters offer this service as an option. If you are offered this as an add-on, try to negotiate a cost if possible.