Unless you live and work around public transportation, you probably need a car to get where you want to go. However, you have options when it comes to paying for your vehicle. Let’s take a look at whether leasing or buying a car works best for you.

Leasing a Car

 Leasing a car means you’re renting the vehicle. In a few situations or promotions, there’s no down payment or loan to worry about; there’s just a monthly payment negotiated with the dealer before your lease. A car lease typically lasts for two to three years, and you return the car once the lease ends.

 Although there may be no down payment, you will still pay certain fees upfront fees. There are also mileage restrictions limiting you to 10,000 or 15,000 miles a year. Additionally, any scratches or dings could rack up penalty fees when you return the car.

 This option has less expensive monthly payments than buying, but you never fully own the car. That means you can’t resell or use it as a trade-in. It also means long-term leasing will eventually cost more than paying off a car loan.

 Car leasing is right for you if:

 ·       You like driving the newest cars

·       You need lower monthly loan payments

·       You don’t want to pay for repairs (most lease terms include warranties)

Buying a Car

 Buying a car means you own the vehicle once you pay off your auto loan. This option could require a down payment, and monthly payments are higher than leasing depending on your term. Once you own the car, you’re free to resell, trade it in or keep it.

 Buying offers you more freedom too. You can customize the car, drive as far as you want and not worry about penalty fees. With this extra freedom comes extra repair costs, since your factory warranty will likely expire while you own the car.

 Buying is right for you if:

 ·       You don’t mind used or affordable car models

·       You want to build wealth by owning a vehicle

·       You want more freedom while driving

 We hope this guide helps you make the best financial decision. If buying is right for you, get no payments for the first 90 days on an Allied auto loan!*

 *Terms subject to change. Credit approval required. Interest will be charged to your account from the original loan date on the unpaid balance during the 90-day payment deferral period. Other terms/conditions apply; contact AFCU for details.