What to Consider When Leasing a Car

When it comes to purchasing a car, there are many different avenues you can take to cater to different price points. If you want to buy your car outright and only have a small budget to work with, second-hand vehicles from trusted dealers can be a great go-to. If you have a larger budget to play with, there are an array of options available to purchase a brand new motor.

Leasing a car is a popular choice for many, as it makes new cars more accessible due to the fixed low-cost monthly payments that leases can offer.

If you’re considering leasing a car, but aren’t quite sure where to begin, here is everything you need to know before taking the plunge.

Leasing vs Buying a Car

If you’re still undecided on whether to lease your next car or buy it, here’s a comparison between the two to help you find the best option for you.

Leasing a car is where you rent a car for an agreed amount of time. At the end of the lease, you can either return it, or purchase the car for a cheaper pre-determined price.

Benefits of leasing a car:

• Low-cost monthly payments
• Fixed costs
• Access to the newest cars on the market
• Lower deposit
• No depreciation worries

Buying a car is where you buy the vehicle as its registered owner. You can choose whether to buy it outright in one cash payment, or on finance in monthly instalments.

The benefits of buying a car are:

• One easy payment if buying outright
• No deposit required
• Easily sell the car whenever you wish as you are the sole owner
• Use your car in a part-exchange to get a discount off your new vehicle

What About Depreciation?

One main disadvantage that is worth mentioning when it comes to buying a car outright, is depreciation. This is the term used for the difference between the price at which you purchase the car, and the value of the car when it comes to selling. If buying, keep in mind that most cars will depreciate the fastest in the first year of ownership, falling between 15-35% on average. This isn’t a worry when leasing a car, as you either return it or simply pay the pre-determined discounted price at the end of the lease.

Insurance and Care

If you choose to lease a new car, the dealership may offer PCP gap insurance. This enables protection for your leased car if your vehicle is stolen, damaged, or written off in an accident – giving you peace of mind that no matter what may happen in the future, you’re covered for every eventuality.