Key Takeaways:
- Leasing lets you drive the latest models for less money upfront than if you were to finance the vehicle.
- When financing a car, you take out a loan to pay for the vehicle.
- If you like to keep your leased car, you have the option to buy it at the end of the lease.
- Both options are practical & doable if you make the payments on time.
If you plan to trade in your old car for a shiny new Kia, you’re making a great decision, and Kia has a great selection of vehicles to choose from. Since cars are getting expensive, deciding how to pay for them wisely is critical.
Both options have advantages and disadvantages; how do you know which is right for you?
Leasing can be suitable if you want lower monthly payments and don’t mind giving up the vehicle ownership at the end of the lease term. However, you must be careful of mileage limits and wear-and-tear fees.
Financing can be a good option if you want to own the car outright and don’t mind higher monthly payments. However, you must be prepared for a larger down payment and higher interest rates.
Ultimately, your best option will depend on your specific needs and financial situation.
Read this blog post by Auffenberg Kia of Cape Girardeau to learn more about leasing vs. financing and find out which option is best for acquiring your dream Kia.
Car Financing: What You Need to Know
This is the most common method of car ownership. Financing a car involves taking a loan from a lender to pay for the vehicle. You’ll make monthly payments until the loan is paid, at which point the vehicle will be yours.
The primary benefit of financing an automobile is that you’ll eventually own it. Once the loan is paid off, you won’t have any more monthly payments to make (unless you choose to refinance the loan). And if you decide to sell the car, you’ll keep all the sales profits.
Reasons for Financing a Car!
You Can Build Equity:
One of the primary benefits of financing your vehicle is that you build equity in it. Equity is the portion of the car’s value that you own.
You May Get a Lower Interest Rate:
If you’ve good credit, you may be able to get a lower interest rate when you finance a car. A lower interest rate implies you’ll pay less in interest over the life of the loan, which can save you money.
You May Qualify for Incentives:
When you finance a car, you may qualify for certain incentives that are unavailable if you lease. For example, many automakers offer financing deals with low-interest rates or cash-back offers. These deals can save you money and make financing a more attractive option.
You Have More Vehicle Options:
You have more vehicle options when you finance a car than when you lease. This is because you can buy any car you want, regardless of whether it’s offered for lease.
You Can Sell the Car When the Loan is Paid Off:
When you finance a car, you own it. So, when you’re done with the automobile, you can sell it and get some of your money back. If you lease a car, you’ll have to turn it in at the end of the lease and will not be able to sell it.
Car Leasing: What You Need to Know
Leasing is like renting a car for a set period, typically two to four years. Like with financing, you’ll make monthly payments on the car, but with a lease, you’re only paying for the portion of the automobile’s value you use during your lease term.
Giving you an example may help clarify this concept.
Let’s say you want to lease a car valued at $20,000 and lease it for three years. This entails that you would only be paying for the portion of the car’s value that you used during those three years. So, if the car depreciates by $5,000 for those three years, you would only be paying for $15,000 worth of the car.
Reasons for Choosing this Option!
You Can Get a Brand-New Car Every Few Years
When you lease a car, you’re only paying for the portion of the car’s value that you use during the lease term. Once your lease is up, you may turn in the car and get a new one. This is perfect for people who like to have the latest car every few years.
You Don’t Have to Stress About Repairs or Maintenance
You’re only responsible for routine maintenance like oil changes and tire rotations when you lease a car. If anything significant goes wrong with your car, it’s covered by the warranty. This can save you a lot of money in repairs over the life of the lease.
You Can Get into A Nicer Ride Than You Could Afford to Buy
Leasing a car allows you to get into a nicer car than you could otherwise afford. This is because you’re only paying for the portion of the car’s value that you use during the lease. You’re not responsible for the car’s entire value like you would be if you bought it.
You Can Avoid a Down Payment
You generally don’t have to make a down payment when you lease a car. This can be helpful if you don’t have a lot of cash on hand.
You Have the Option to Buy the Car at The End of The Lease
If you decide that you love the car you’re leasing; you have the option to buy it at the end of the lease. This is called a purchase option. Remember that you may have to pay a fee to exercise this option.
Also Read: Financing a New Car in Cape Girardeau
Looking For a Ride in Tamms, IL? We Can Help!
Auffenberg Kia of Cape Girardeau offers our customers a wide range of car finance options in Tamms, IL. We understand that not everyone is looking to purchase a vehicle outright. That’s why we offer financing opportunities on all of our pre-owned vehicles. Schedule a test drive with us today!
