Lease used cars

Buying and leasing are two different ways one can purchase the use of an automobile. Each method offers its respective strong points and weak points. Let's take a closer look at both.

Buying a Car

Buying car is a scenario that most people are familiar with. You pay up front for the entire cost of the car. This usually involves taking out a loan from a bank, buying the car and then making monthly payments to repay the bank. As a result, you obtain full ownership of the car. The bank payment consists of two parts: the principle amount, and the financing charge. The principle is simply repayments on the original money that was borrowed, while the finance charge is the interest, or a fee that the bank charges in return for loaning out the money. You can own the car for long enough to completely repay the bank. Once this point is reached, no more payments on the car are necessary. Another advantage is that the car now belongs fully to you for you to sell or keep as you like.

But buying also comes with some disadvantages. Monthly payments for buying are almost always significantly higher than lease payments. Once you pay the car off, you may have equity in your car, but it is money that you'll never be able to get back out again. Traditionally, automobiles are terrible investments. With very few exceptions, they depreciate in value quickly and as they age are worth only a fraction of their original purchase price.