Step 3: Should you lease or buy your next car?
A lease requires little or no money up front and offers lower monthly payments. But when the lease ends you are left without a car and a need to replace it.
Buying a car is more expensive initially and the monthly payments are higher. But at the end of the loan, you will own a car you can still drive or sell.
Other key factors that differentiate leasing and buying include:
Advantages of Leasing
• You can drive a better car for less money
• You can drive a new car every few years
• No trade-in hassles at the end of the lease
Advantages of Buying
• When interest rates are low, it makes more financial sense to own a car rather than lease it
• No mileage penalty
• Increased flexibility — you can sell the car whenever you want
If you are still unsure whether to lease or buy, try letting the numbers help you make the right decision. Go to Edmunds Finance Calculators to calculate your monthly auto loan payment vs. your monthly lease payment.
By Philip Reed, Senior Consumer Advice Editor
http://www.edmunds.com/advice/buying/articles/
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