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Is it cheaper to lease or buy a car?

Leasing vs buying – which offers the best car deals?

11th December 2017 | Cory Mosey

Car leasing was relatively unheard of in the UK up until a few years ago, particularly when compared to the US where one in four cars are owned through personal leasing. In today’s market however, more and more people are switching to this option in order to find the best car deals.

But should that be enough reason for you to lease a car?

Well for starters, there isn’t much financial sense in buying a car outright, especially if you don’t have a lot of cash flow. Unlike houses, it is estimated that cars roughly depreciate in value at around 15% per year – meaning they aren’t a particularly worthwhile investment.

Some drivers will find that they can save money by leasing a vehicle instead of buying it, while others will favour buying one through finance. It’s all a matter of perspective.

Is it cheaper to lease or buy a car?

When you’re in the market for a new car, there are plenty of things to consider. Like whether or not you should pay with cash or get a finance deal. Or how about leasing a car for a fixed period rather than buying one?

Before you come to make your decision, you should consider the many benefits of cheap car leasing for future reference.

Leasing

– Down payment is low or non-existent

– Monthly payments are lower than loan payments

– Easier to obtain than finance loan, even with bad credit

– Most warranties last 3 years

– Maintenance costs are cheap

– No depreciation concerns

– Can be claimed as a tax deduction if you own a business

Buying

– Insurance costs will decrease over time

– Builds up equity

– Can use trade-in amount to buy new car

– Don’t need to worry about mileage limits

– Free to modify / accessorise as you wish

According to a recent US study, they calculated the costs of owning a car versus leasing and found that after five years it was CHEAPER to lease. They discovered how much the cost of financing a car would be, as well as taking into consideration other costs such as insurance, tax, maintenance and so on.

In effect, if you’re looking for a more permanent solution then a long term car lease may be the answer for you.

What benefits do I get from leasing a car?

Leasing a car is a lot like owning a mobile phone. There’s a certain status that comes with having the coolest, most fashionable phone on the market and that’s becoming the mantra when car shopping. Most phones come with a minimum two-year contract because retailers know that consumers will want the latest phone on the market soon after.

There’s a growing market for car leasing because not only do people get to have a shiny new car every couple of years, they can also benefit from using the latest technology and designs. Having things such as safety systems and more eco-friendly engines are very desirable, much like having the best camera or the newest tech on a mobile would garner your interest.

Some of the biggest reasons for people wanting to lease a car, include:

You can get car loans with bad credit

If you ever find yourself in the unfortunate position of having bad credit, you will understand that it can be difficult to apply for certain things. Here at Tilsun however, we have access to various finance companies who can help you find a good deal – even if your credit rating isn’t great.

It is important that you present relevant documentation to affirm your status, including wage slips, bank statements and proof of ID.

There are plenty of tax benefits

If it means you can save a few extra quid each year, then go for it. In most cases you needn’t worry about paying road tax when leasing a car, as the lending company will take care of it for you. The only problem you’ll have to deal with is trying to figure out how to spend all that extra cash!

Lower maintenance costs

Maintaining a vehicle can be fairly expensive in its own right, so you’ll be happy to hear that this isn’t an issue when leasing. Because you do not own the vehicle, general costs will be covered by the manufacturer’s warranty period.

Here at The Tilsun Group we have an incredible selection of car leasing options that you can look forward to taking advantage of in 2016. Because we work with some of the industry’s leading manufacturers, we are able to present you with a wide variety of models – so you can be sure to find a vehicle that’s perfect for you!

For more information on how The Tilsun Group can help you, please get in touch with one of our experienced advisors today on 01606 545 900 or visit our contact page.

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