Here at Cambridge Honda, we believe in giving our customers options. Buying a car is one of the largest purchases you will make this year, so having options for financing ensures you find the payment structure that fits your needs. Two of the most common financing options are buying and leasing. Click through the tabs below to see the benefits of both financing and leasing.
Buying vs. Leasing
Click through the categories below to learn more about the benefits of Buying or Leasing your next vehicle. If you have any questions please feel free to contact our Finance department filling out the form on this page.
Ownership
Buying:
If you tend to hold on to your vehicles for an extended amount of time, then traditional financing may be the right option for you. When you finance the vehicle, it's yours to keep once you have finished paying off the auto-loan.
Leasing:
When
you lease, you sign a contract that allows you to enjoy a new vehicle for a specified amount of time. This allows you to drive a brand new vehicle for a few years, then give it back to the dealership when your contract is up!
Up-Front Costs
Buying
Up-front costs include a down payment on the vehicle, taxes, registration as well as other fees from the dealer.Leasing
One of the greatest advantages of leasing your new vehicle is that the down payment tends to be substantially less than buying. In many cases you can even roll your state tax into the monthly payment instead of paying a lump sum at the dealership.
Monthly Payments
Buying
Monthly loan payments typically run higher than that of lease payments. With an auto loan, you are paying down the entire purchase price of the vehicle, plus any interest and finance charges from the financial institution, taxes and other fees.
Leasing
If the financing period is the same, generally your monthly payment will be less when leasing a vehicle. Your payments are based on the vehicle's estimated depreciation instead of the purchase price.
Mileage
Buying
Because
you own the vehicle, there are no restrictions on mileage. Higher mileage,
however, decreases the overall re-sale value of your vehicle. This is important to consider for people who drive upwards of 15,000 to 20,000 miles a year.
Leasing
Because mileage effects the estimated depreciation of the vehicle, lease contracts typically govern the amount of miles that are allowed per year. There are additional fees for miles driven over the limit. Its important to know your mileage requirements before you lease.
Maintenance
Buying
Because you own the vehicle, you can choose when, where, and how you maintain it. as the vehicle grows older maintenance costs tend to increase.
Leasing
Regular maintenance such as oil changes, are necessary and required per the terms of your lease agreement. Because the vehicle is new, however, maintenance costs tend to be minimal.
Wear & Tear
Buying
when you buy a vehicle, you don't have to worry about excessive wear and tear. Excessive wear and tear will lower your vehicle's re-sale value.
Leasing
Most
lease contracts will hold the lessee responsible for excessive wear and tear to the vehicle. You will
have to pay additional charges if you exceed what is considered normal
wear and tear to offset the vehicles loss in value.
End Of Term
Buying
Once you complete the payment schedule for your auto loan, you no longer have any monthly payments, and you have established equity in your vehicle. You own it!
Leasing
At
the end of the lease term, you return it to the dealership and decide again which option is best for you! this gives you an opportunity to drive new vehicle more frequently.