Car leasing is a growing trend in the world and is gaining more and more popularity by the day. This is not only because it is a financially viable solution but also because it offers the user many other amenities as well. But as with any other service in the market, car leasing has its own set of flaws with lack of complete ownership being the biggest of them. Although it is a growing trend, not many people are aware about this process due to the novelty of it. So given below is a handy guide structured based on car leasing pros and cons:
Pro #1 – Low cost
As mentioned above, the economic viability of this process plays a pivotal role in its sales. Usually in a car purchase, the customer applies for a loan, purchases the car and spends the next several years paying it off. But on the other hand, car leasing payments are lower in terms of both payment and payment time. When in financial difficulty, you do not have to make your payments since the contract can be terminated. Furthermore, since most car leasing contracts are made for a minimum of 4 years, the customer will not have to spend much on upkeep, maintenance and repair.
Pro #2 – Flexibility
Unlike car purchasing, leasing is usually done according to the customer’s terms. He/she will be given a say in the lease period as well as the amount. Leasing a car enables you to drive a new model every once in a while. This way, you do not have to be stuck with an outdated car. Furthermore, since this process has fewer financial restrictions, you will be able to choose a car that you like rather than a car that you can afford.
Con #1 – Mileage limits
A car lease contract restricts you from driving to your heart’s content. The contract will give you a mileage limit which you will have to adhere to in all situations. The usual mileage value given for a customer is between 12,000 – 15,000 miles per year. Failure to comply will result in penalty. That is, you will have to pay compensation for every extra mile that you drive. This limits spontaneous car trips and forces the user to stick to a preplanned schedule.
Con #2 – No customization
Despite all the advantages, the bitter truth is that, the car does not belong to you. It is a property of the leasing agency and is only temporarily borrowed. So you are expected to return the car at the end of the lease period. Although most users include additional sound systems, accessories, and gadgets and even change the color of the car after signing the lease contract, all modifications must be reversed before the car is returned to the agency. This way, you will have to pay for both installing and removing the modifications.
So remember to do your research before making the final decision. Instead of going with trend, choose the option that suits both your financial and driving requirements.