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Tuesday, January 31, 2023

Buying Advice 4: Lease or Buy a Car?

Here is part four of the series about leasing or buying a car.

Tip 1: Both leasing and buying will require you to make a down payment at the beginning of the term. In short, it is best to save a moderate amount of cash in order to make a sufficient down payment. Buying a car will require you to pay for at least 10% to 30% of the total price of the car as a down payment. On the other hand, some lease deals will require you to pay just a small advance payment in order to drive home the car. It is always best to make a down payment as zero-down financing and leasing deals will cost more money in the long run.

Tip 2: Choose the shortest loan term or lease term as much as possible. This will further help you save money in terms of monthly interest rates. Extremely long financing terms that can reach 60 to 72 months might sound promising at first but you will otherwise end up paying too much for the price of the car. Here’s another hint: the longer the term, the higher the interest rate. Why? Because lenders are taking too much of a risk on longer loan periods.

Thinking about buying or leasing a car? More leasing and buying tips coming soon. In the meantime, check out the latest car prices in order to figure out the right price to pay for any type of car.