October 19, 2021

ONB-AUTO

Nuts about Car

Should you lease or buy a new vehicle?

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Owning a car is a goal many people work towards, but with many options available, buying is not the only way to own a vehicle. Leasing and renting cars has become popular as they are short term cheaper options than owning and maintaining your own automobile. Knowing the difference between leasing or renting a car will help you make a decision that will work best for you and your pocket. Reading honest reviews from people who have rented or leased a car will help you get a sense of which option you should choose.

There are a few things to look at when deciding to lease or rent a vehicle from a company:
Length of time you will need a vehicle:

  • You are able to lease a car over a longer period of time, usually about 2 years. With leasing you are paying the interest to cover the depreciation of the value of the car.
  • With rentals, you can keep the car for a day, a month, or as long as you need it. Some car rental companies offer special rates for monthly rentals.

What you will need the car for:

  • A lease car is a good option for longer term use, such as to get to work and back for a set period of time. Looking at a few different leasing companies will help you find the best lease car for your needs.
  • A rental car is the best option for short term use such as a business trip in another state, or to use if your car is at the mechanics for some work.

How do you pay for the car?

  • Leasing is a form of vehicle finance, and works the same as if you were applying for a vehicle loan from the bank. With leasing, you still need to get loan approval, have proof of income, and a credit check is performed. 
  • Rental payment is charged to a credit card. You are only billed at the end of the term you rented the car for. These charges also include any damages incurred while the car was in your possession. To know more about any other charges for renting a car, you are able to find all the information in online articles.

Insurance options:

  • Leasing a vehicle still requires you to have car insurance, which is an extra cost on top of the cost of leasing the vehicle. Repairs and maintenance are also for your own cost.
  • Rental companies provide insurance as part of the rate you are charged to rent one of their cars. Repairs and maintenance is for the company’s responsibility. 

Other:

  • Leasing is a more permanent or semi-permanent solution, with some leasing companies offering the option to buy the car at the end of the lease term at a reduced cost. Another benefit is that lease cars are generally newer, and will therefore need less repairs and maintenance and over less service problems. It is important to check with your leasing agency about any hidden costs such as mileage limits. Once you reach your mileage limits, you start paying per mile fees, which can become costly.
  • Renting is a quick, short term solution. As stated above, you do not need insurance to rent a car. A drawback of a rental car is that they are generally older, and might have more problems. Rental cars do not have mileage limits, and can be driven as much as you require.