- Auto leasing vs. financing is a trendy topic for most middle-class Americans in today’s high-priced auto market.
- Auto leasing is a complex rental that lasts 2 to 4 years in depreciated car costs payback plus taxes.
- Auto financing is when you decide to secure an auto loan for the eventual ownership of the car you need.
- Generally speaking, a car lease costs far less than financing. But there are benefits either way.
- Lakeland Ford, serving Bartow, FL, deals in an exceptional inventory of vehicles available for lease & with financing!
Auto leasing used to be the most ’90s thing to do for every middle-class All-American family. Whether you went on a long trip, a corporate event, or even a date – the lease was there for you at a much more effective appeal rate than a dinghy rental. The trend petted out to auto financing by the late 2000s because it was better to own your car.
Forget all that; this is Bartow, FL, and believe it or not, but apart from nightclubs and the occasional Florida Man news, it’s also famous for being in the region for the highest ‘lease a car’ trends.
What Drives the Car Leasing Trend in Bartow?
The trend is driven by a number of factors, or consumer utility, as we put it:
Most of the auto market is driven by the customer’s desire to have only the latest & greatest automobiles they can get. A lease only brings that fancy car closer to your reach without the extra hassles you would have to go through if you were to buy the car.
2. Auto Prices
With a new car priced at an average of $42,380 in 2021, this year is seeing prices go over $47,000. It is simply too difficult to afford a car in this receding economy. So, the next best option is an auto lease.
When you lease a car, you land the best eco-friendly, safety & infotainment features in your car of choice at a fraction, fraction, price. So, that is another superficial attraction.
4. Time To Garage
It’s quicker to lease a car than to finance it or buy it. And you are free from debt as long as you stick to the lease’s conditions. You sign a few papers, and your new car is in your garage!
In a lease, you can just about sample any car you like as long as your FICO scores are on your side. But, the higher-end the car, the more you pay to use it.
Wait, Is It Financing or Buying?
Okay, so, to clear the confusion. If you’re buying a car, that means you attain 100% equity on the vehicle on the transfer of funds. The payment is immediate or in installments; that is perfect for you!
In auto financing, you either have a bank or a dedicated dealership that grants you an auto loan to finance a car that you need. Authorized dealerships like us take a lenient background check and grant you a loan to buy your new car, but there are strings attached. We’re talking financing against leasing.
Do Folks Even Finance Their Cars These Days?
There you go again with the skepticism!
Admittedly, with record high inflation, the financing rates have gone up a few notches. Add in the chip shortage due to geopolitical tensions & the supply chain disruptions stemming from the pandemic; you can see why new cars are so pricey. But that doesn’t make them less worthy. It makes them more coveted!
Just for reference, if you were to take on a 6-year loan for a new car priced at $30,000, with a 4% interest atop the 2022 rates this year, you would have to pay $13 more per month, and a total of $976 on the price tag. And current rates are going from 4.07% to 8.67% on just a new car, with a hike from the 2.4% of yesteryear to today’s 14.76%. It would be harder to lease such a high-priced car too!
But wait, it’s not as bleak a picture as you are assuming from the numbers. Auto leasing & financing hold many benefits if you consider the things that need to be covered to make it to the approval of a reputable car.
So, Is Auto Leasing Better? Or Auto Financing?
Both have pros and cons in achieving the maximum utility required by a customer. But, after all, these are car ownership options designed for…
- people who can buy a car
- people who need a car but can’t afford it
- people who can’t afford a car but can pay for the time they use it and want the models they like best.
That’s nearly rudimentary, but you see how financial institutions & authorized dealerships facilitate car ownership opportunities for customers from all walks of life. Here is why you need to consider some more factors to your auto leasing & financing ability, plus what you really desire from your auto ownership.
· Print Your Credit Report
This information decides whether you are legible to lease a car or secure a financing deal. It will also determine your interest rates on the financing received.
· Secure The Car’s Price in Writing
If you need to lease or finance a car, consider getting the car’s full range of costs in print for later comparison.
· Know Your Costs
Don’t get swayed by the low monthly rates. Consider whether you can afford them long-term. Make a budget sheet to help you decide your payback period better.
· Check Your Savings
Don’t rush into the buy. Consider your savings for a viable down payment. That sets the pace for lower auto financing & leasing costs.
· Get a Reliable Co-Signer
If your credit is shaky, you can ask a reliable FICO score holder to co-sign on your lease, purchase, or financing.
If You’re Leasing a Car
- Consider your mileage. Standard leases offer 15,000, so be prepared for a higher monthly payment if you decide to negotiate for more annual miles. It’s better than violating the mileage & paying a hefty fine.
- Consider regular maintenance. Your insurance is dependent on how well you adhere to the lessor’s conditions to keep the car free from harm.
If You’re Financing a Car
- Secure Pre-Approval. Getting your credit terms validated before shopping for a car gives you vital information on the APR, loan lengths, and max borrowing amount. The information can be used to negotiate a deal with the dealer.
- Try multiple dealers. With a pre-approval in hand, you can negotiate car prices at multiple dealerships without even having to visit one. That makes it easier to finance a car.
Do You Need to Evaluate Your Auto Financing or Leasing Options in Bartow, FL?
At Lakeland Ford, serving Bartow, FL, we don’t turn away anyone’s dream to have their own car on their terms.
Just to show you how far we go to facilitate our customer’s dream of an impressive ride, we’ve got a stunning 2022 Ford F-122 at 2.9% over six years. You can defer payment for up to a year, after which you have to fulfill the terms of financing.
Feel free to contact our finance department and try out our calculator to help you get a step closer to considering a car for auto leasing or financing.
We’ve got discounted specials, too, if you love to own a tough ride on wheels this year!