Purchasing a car can be a huge investment, so it makes sense that some people may be wary about jumping right into the world of vehicle ownership. In order to combat high costs of buying a car and the pressure that comes along with it, drivers occasionally turn to leasing. There are many pros and cons associated with renting a vehicle, however, and it is necessary to go over these facts before making a decision.
Pros
One of the major advantages of leasing a car, according to Money Crashers, is that there are less vehicle maintenance issues associated with the vehicle. Any issues that come up as a result of natural aging of a car will likely be addressed by the owner, giving the driver less stress and upkeep responsibility.
Money Crashers also reports that about 75 percent of all luxury cars are leased. Drivers have the ability to temporarily possess a high-class car without many of the long-term costs or loans associated with it. There is also no large upfront payment to be concerned with, as drivers just go right into paying the monthly rental fees. In addition, buyers can avoid sales tax while still taking advantage of several federal tax incentives available for businesses that lease cars.
Cons
It is important to note that leasing can end up costing more over a long period of time, reports CBS News. The monthly payment for a two-year lease is generally lower than a loan payment, which can save money in the short term. But the longer drivers lease a car the more the costs begin to even out. CBS News reports that the cost of leasing a new car every two years for a 10-year period is more than buying one car and driving it for 10 years.
Leasing also imposes limits on mileage and personalization. Drivers often are not able to add accessories that would enhance their experience, even if it something as basic as auto air conditioning service. The contract also limits how many miles can be added to a vehicle within a certain time period, regardless of the circumstances or condition of the tires.
Finally, there may also be fees hidden into a leasing contract. Drivers will potentially have to pay for additional insurance, maintenance costs for minor wear and tear such as scratches or a penalty for early termination.