Should I lease my next car?

Lease my next car?

If your clunker of a car is gasping its final breath, you are probably in the midst of deciding whether to lease a car.

There are pros and cons to either leasing or buying, but financial experts say buying and keeping a new car for the long term is usually the better deal. No matter which scenario works best for your individual needs, you should negotiate the deal, says Dayana Yochim, a consumer finance expert in Alexandria, Va.

"First negotiate the price of the car, then negotiate the trade-in value -- if you have a car to trade -- and then you can talk about how you want to finance the car," Yochim says. "Even with a lease, everything is negotiable."

Here are six things to think about before you decide: Should I lease my next car?

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So your clunker's about to kick the can, and you're deciding whether to buy or lease your next car. Buying and keeping a car for the long term is usually the best deal, but exceptions apply.

Leasing makes sense for someone on a tight budget. The payments are typically less than car payments. But there are hefty penalties for terminating a lease early or exceeding mileage limits. If you have a long commute or make regular road trips, buying will allow you to be spontaneous about traveling.

Maintenance will cost you whether you buy or lease. You don't have to worry about scratches or dents if you own the car, but you'll face financial pressure to return a lease in excellent condition.

And bad credit hurts whether you buy or lease. Check your credit at least three months before you plan on doing a deal. Whether you lease or buy, monthly car costs shouldn't exceed more than 10 percent of your income.



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