Car Leasing The Pros And Cons
Car leasing is a method of financing the use of a car, van or other type of vehicle so that you can have use of it. It differs from ownership in that the person that leases the vehicle never actually owns it. The ownership of the vehicle remains with the company that lease the vehicle and the person that uses it has use of it over a set period of time. It is essentially a long term version of car hire. The typical length of contracts for car leasing last between 12 months, 24 months and 36 months.
Like car repayment loans the payments on the vehicle are made every month. Car leasing often works out cheaper than car loan repayments per month. This is because at the end of the agreement the person that has utilised car leasing does not have ownership of the vehicle. At the end of the agreement the person that leases the vehicle returns the vehicle to the owner. This is beneficial to both the person that leases the vehicle and the person or company that leases the vehicle out. For the person that owns the vehicle the vehicle remains theirs are is their asset. The leasing deal pays off the cost of the vehicle and gives the person that owns the vehicle a small profit.
There are a number of benefits to the person that uses car leasing. The major benefit is that car leasing payments usually work out less per month than car loan repayments. The person does not own the vehicle at the end of the contract but this in itself can be a benefit. For starters the person that uses car leasing does not have to worry about the depreciation in value of the vehicle. This is because at the end of the contract they simply return the vehicle to the owner and as a result they do not have to worry about the value of the vehicle or the hassle of having to advertise and negotiate a sale. This can make changing vehicles a doddle. This is an extremely appealing aspect of car leasing.
Another great benefit for people that want to use car leasing is that they can often manage their funds easily. This can make it an extremely appealing option for people that want to be assured of their monthly outgoings. The deals can be arranged to include breakdown cover and maintenance costs so that even if the car breaks down the cost of the vehicle does not vary. This way you can avoid being stung by unexpected costs that are associated with owning a vehicle. Most deals also include insurance so that the price you agree on is the price you pay every month regardless of anything else.
Car leasing also enables people to afford vehicles that would ordinarily be out of their price range. Because the monthly payments can be less than the monthly payments on a loan it can mean that you can stretch to a vehicle that would typically be too expensive. You also do not have to put down the massive down payment which is required when purchasing. It also makes updating your vehicle simple because at the end of the agreement you simply return the keys and then you can find a newer model without any stress of having to sell the vehicle on.