Our guide from Mercedes-Benz Kingston explains leasing vs. buying as you explore your options with us. Remember, your financial situation is unique, so keep that in mind when you compare leasing and buying a car or SUV.
Should I Buy or Lease a Car or SUV?
When you look at leasing vs. buying a car or SUV, both options have similar trajectories as far as payments. You will need a down payment. And you need to make monthly payments. But how these are structured can be different.
Should you buy or lease a car or SUV depends on your current financial situation and how you plan on driving your new vehicle.
Should I Buy or Lease a Car?: Leasing
Leasing a car near Prince Edward County is similar to renting a car. You will have a specific contract to follow, and the monthly payments are locked in based on the value of the car and the value of the car as time goes on. There is no equity to build because the dealership still owns the vehicle. There are distance limits, and you must keep up with maintenance at our dealership near Ottawa. When the car lease is up, you have options. Trade your vehicle in and replace one leased vehicle with a new one, buy the vehicle with an auto loan or with cash, or end your lease. You could get a new car every few years in this way.
Should I Buy or Lease a Car?: Buying
Buying a car typically means getting an auto loan. Our finance team has relationships with lenders, and we will help you find the best loan terms possible. Buying a car means you can build equity and credit, which can lead to better interest rates later.
Should I Buy or Lease a Car?: Pros
There are advantages to each method when you compare leasing and buying a car. The method that is right for you depends on your preferences and finances.
Pros of Leasing:
- Lower Monthly Payments: Leasing a car means lower monthly payments because it is not based on the entire value of the vehicle.
- Worry-Free Maintenance: Just bring your vehicle to our service centre, and we will take care of you.
- No Worries About Resale: So long as you do not exceed the distance you can drive, just return the vehicle to us and we will sell it as a certified pre-owned model.
- Get a New Car Every Few Years: If you keep leasing after each contract is up, you can get a new vehicle in your garage every few years.
Pros of Buying:
- Ownership: Once you finish your monthly payments, you own the car outright and can do with it what you will. Sell it. Drive it for 300,000 kilometres. Give it to your children. The options are limitless.
- Customize Your Vehicles: You can customize your vehicle with a purchase because you own it.
- No Restrictions: You are not restricted in the distances you can drive with a purchase. So, set a course for your favourite weekend spots and summer vacation routes.
Should I Buy or Lease a Car?: Cons
There are advantages to each method when you compare leasing and buying a car. The method that is right for you depends on your preferences and finances.
Possible Cons of Leasing:
- Distance Requirements: You will have to pay fees if you drive the vehicle too much.
- Constant Monthly Payments: Keep up those monthly payments, or the dealership will ask to take back the car or SUV.
- Higher Financial Standard: In general, a lease is for well-qualified drivers and has a higher standard compared to buying.
Possible Cons of Buying:
- Higher Monthly Payments: Purchasing a car means higher monthly payments, in general, versus leasing.
- Rapid Depreciation: New cars can lose between 15% and 50% of their total value in the first five years. So, if you plan to sell your vehicle, keep that in mind if resale value matters to you.
- Larger Down Payment: Buying a vehicle typically needs a higher down payment, around 20% of the total value. So, save up for the down payment.
Buy or Lease Your Next Mercedes-Benz at Mercedes-Benz Kingston
Ready to see your next new vehicle in person? Contact us or call 613-548-8600 to schedule a test drive with our team. In the meantime, look over our new vehicle specials.
