Leasing of cars has become popular over the years because it allows you to drive a new car after a fixed period with low monthly payments. In addition to that, you do not have to worry about the resale value of the car. With this arrangement, individuals pay a fixed monthly payment for a specified period and miles covered. After the term, individuals can choose to buy the car or hand it in. Leasing can offer attractive advantages as compared to buying, and this article shows some of the benefits of car leasing.
Lower Monthly Payments
When leasing a car, you only pay for a portion of the value of the car. Therefore, the monthly fee will be between 30-60% lower than the loan you would have paid for the car. There is no extra cost incurred at the end of the month for investment in ownership equity.
No Down Payment
This system provides the option of not making a down payment. All you need to do is to pay for the first month and add the official tag and registration fee. That is the case for most car dealers. However, some promotional dealers require a down payment to seal the deal, but they are not common.
Lower Tax Bites
In most states, you will not be required to pay sales tax on the entire value of the car. That only happens when you make a purchase. You will only be taxed the portion of the value of the car that you leased for. What happens is that the tax will be spread out and you will pay it as you make the monthly payments. That way, you will not have the burden of paying the entire amount at a go.
No Used Cars Hassles
With leasing a car, the headache of selling the car once you are tired of it is eliminated. You will use the car and return it to the leasing company. If you want to buy it, you have that option as well as trading it in. Most people get frustrated when they want to sell their cars, but the value has gone down significantly, yet they can’t afford a new one. Leasing of cars eliminates such issues.
GAP Cover Included
Car leases have a free GAP protection whereby if the vehicle is stolen or involved in an accident, it pays off the vehicle in case your insurance company does not cover for the full loss.