Leasing vs. Financing a New Vehicle

Leasing vs Financing

Leasing vs. Financing a New Vehicle at Premier Chevrolet of Buena Park

Sometimes it might be difficult to decide whether to buy a car outright or lease one. While purchasing entails higher monthly costs, you ultimately own your car. In contrast, a lease provides cheaper monthly payments and enables you to drive a car that you might not otherwise be able to afford, but you enter into a pattern where you are always paying something for your vehicle. Premier Chevrolet of Buena Park is here to service the Santa Ana, Los Angeles, or Long Beach areas and many more,  if you are located in or near these cities, come on down and see what we can do for you today!

Benefits of Leasing

Leasing may seem more enticing than buying to some people at first glance. Due to the fact that your payments don’t go towards the loan’s principal, the monthly payments are typically smaller. You simply borrow and return the difference between the car’s worth at the time of purchase and its estimated residual value at the conclusion of the lease, plus financing costs. Some of the major benefits of leasing are as follows:

  • You always will be driving a late-model car that is typically covered by the new-car warranty offered by the manufacturer.
  • Your safety features will generally get better from year to year.
  • It removes the hassle of having to buy a new car, you simply return your vehicle to the dealership at the end of the lease and upgrade to your next new vehicle.
  • When it’s time to move on, you won’t have to deal with the headache of selling the automobile or worry about its trade-in value fluctuating.
  • The lease may also come with added features that new automobiles don’t usually have, such as cost-free scheduled maintenance and routine oil changes.

Drawbacks to Leasing

One of the biggest drawbacks to leasing is that the monthly lease payments will never end if you lease one vehicle after another. In comparison, a car’s worth increases the longer you keep it once the loan is paid off. Since you’re paying for the vehicle while it’s depreciating most quickly, leasing typically ends up costing you more than a comparable loan. Some more of the disadvantages of leasing are as follows:

  • A set number of miles you are allowed to drive is generally stipulated in lease agreements. You will incur additional mileage charges if you exceed that cap.
  • If you break a lease early, you’ll likely be hit with thousands of dollars in fines and early termination costs, which will all be due at once.
  • When you return the car at the conclusion of the lease, there is a possibility you might have to pay additional fees.
  • Expendable things like tires, which might be more expensive to replace on a better-equipped vehicle with premium wheels, are still your responsibility.

Long Term Loan Alternatives

If you want to drive a new automobile every few years, taking out a loan to purchase a car is not the best option for you. You would be better off leasing if you took out long-term loans and traded them in early because you would end up paying so much more in interest charges than in principle. Leasing can be worth the extra expense if your objective is to make small monthly payments and drive a new car every few years with little difficulty.


If you are curious about your buying or financing options, give our finance center a call or apply online today. You can also use our payment calculator tool that will inform you about how much your monthly payments should be.