auto

Should I lease my next car?

Lease my next car?
Buy or lease a 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?

Shopping for a car or just a car loan? Download Bankrate's auto app for price comparisons, loan calculations and more.


Listen to audio
Show Show Transcript

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.

 

advertisement

Show Bankrate's community sharing policy
          Connect with us
advertisement
 

A little research could save you BIG on interest.

Don't have time? Our rate-tracker tool saves you time and money. Delivered Thursdays.
 
advertisement
Partner Center
advertisement

Blog

Tara Baukus Mello

Labor Day road trips to increase

AAA Travel projects that 34.7 million Americans will travel more than 50 miles from home this Labor Day weekend, the highest volume since before the 2008 recession.  ... Read more


Connect with us