Should I Lease or Buy a Car? [Quiz]
If you're wondering whether to lease or buy a car, there isn't one simple piece of advice to help you make your decision. Instead, you need to weigh the pros and cons and think about what you want out of your car buying experience.
Luckily, we've created this fun, short quiz to help you answer the lease or buy a car question. Read on to find out your best option!
How Does Buying a Car Work?
Many people choose to buy a car with an auto loan, though you can also pay in cash. A popular option is to save for a down payment and then borrow the balance. Here's how it works:
- Shop around for a lender offering great rates and terms then get pre-approved for your auto loan.
- With a check in your pocket, you can find your dream car and get a great deal.
- You make equal monthly payments, with interest, until the loan is paid off in full.
- Now you own your car outright!
How Does Leasing a Car Work?
Leasing is a great option if you prefer newer cars and want to get a different vehicle every time your lease expires. Here's how it works:
- Choose a leasing company that offers a car you want with a monthly payment you can afford.
- After upfront fees and costs, you'll pay the same amount every month until your lease expires.
- You may need to pay fees to end your term early, or for excess mileage or wear and tear at the end of your term.
- Now you can choose to buy the car or begin a new lease with a different car.
Take This Quiz to See Which Option is Right for You
Our quick “Should I Lease or Buy a Car Quiz” is here to help you make the right choice for yourself and your family. So let's get started!
1. Do you want to own a car outright?
YES? Then you should buy your car with an auto loan so you'll have an asset at the end of your loan term. Plus, you can use any equity to go towards buying your next car.
2. Do you want an end to monthly payments?
YES? Then you should buy your car with an auto loan so that you'll be debt-free with no more car payments at the end of your loan term.
3. Do you always want to be behind the wheel of a new or near-new car?
YES? Then you should probably lease a car because leasing companies tend to offer newer vehicles only. Plus, you might be able to lease a more expensive, newer vehicle than you can afford to buy.
4. Are you open to an older model vehicle?
YES? Then you should buy a car because many auto loans let you choose a vehicle that's more than five years old, so you can get the exact model you want and easily find a car within budget.
5. Do you want lower costs upfront?
YES? Then you should buy a car with an auto loan because there will be fewer upfront fees than for a lease. You can choose whether you make a down payment. You need to pay taxes or registration whether you buy or lease.
To lease a car, you might also need to pay the first month's payment, a refundable security deposit, and an acquisition fee.
6. Do you want lower monthly payments?
YES? Then you should probably lease a car as payments are typically lower than for an auto loan payment. Of course, the exact difference between the two will depend on what car you lease or how much you borrow on an auto loan.
7. Do you want to drive unlimited miles and customize your car?
YES? Then you should buy a car because your auto loan comes with no restrictions on what you do with the car. As long as you make your payments, it's yours to use as you like!
8. Will you keep your car in great condition with low mileage?
YES? Then you can choose to lease or buy your car.
But if your answer is, hmm, maybe, then you might want to think twice about leasing. At the end of your lease, the car will be inspected and you may need to pay fees if you've clocked extra miles or if the car is showing more than usual wear and tear.
Next Up: Choosing an Auto Loan Term
We hope this handy “Should I Lease or Buy a Car Quiz” has helped you make up your mind. If you've decided leasing is for you, then you don't need to read any further!
If you're thinking an auto loan is the right move, then the next thing to consider is the length of your loan term. Shorter terms save on interest but mean higher monthly payments. So the best idea is to find the term that fits your budget. Click below for details!
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