Although you will find many sources that tell you that leasing a car is a mistake, there are numerous situations when this could actually be the best decision you ever made as it can help your business save money. A vehicle is a depreciating asset thus, if you can lease one and get everything done, it could be the right thing. Below are some of the situations when leasing makes sense.
1) When Lease Payments are Lower than the Loan Payment on a Purchase
You can lease a vehicle without having to pay a down payment. Mostly, the upfront fees get rolled into your monthly payment. When you purchase a new car, the dealer will need you to pay a 20% down payment so that you can get a great car loan rate. In such a scenario, leasing a vehicle makes more sense.
2) When You Need a Vehicle for Your Business
With the way vehicles are evolving rapidly, you need the best especially when it comes to fuel efficiency. Depending on the kind of business you run, a vehicle that has the highest fuel efficiency will benefit your company highly. You will also not be burdened with the task of having to sell the vehicle after a few years so that you can purchase a bigger or better one. All you have to do is swap the leased car for a better and bigger vehicle when the lease expires. The fact that leased cars are mostly acquired without a down payment means that you will not require an upfront investment of capital. It means that you can use the money on other important projects. This guide for businesses can advise you on all the benefits of leasing a vehicle.
3) When the Need for the Vehicle is Just Temporary
If you only want to drive the vehicle for just a few years, leasing is your best and convenient option. It could be that you like driving a new vehicle every few years or you have been posted to a remote area for a job contract that lasts 3 to 4 years. In such a case, there is no need to use a substantial amount of money as a capital investment on a new car that will end up depreciating in value. Also, a leased car is always under warranty, and so, you do not have to worry about repair or maintenance costs.
4) You Turn your Cars Over Quickly
There are some professions like real estate and law that require one to portray the image of financial success. A car is considered a reflection of such professionals’ social status. Also, some people love driving vehicles that have the latest technology and features. Leasing can help with that as you will get a brand new vehicle every 2 to 4 years.
5) When Dealers Roll Out Leasing Give-Away Deals
Sometimes, car dealers give their customers surprisingly low lease rates on specific vehicles. Mostly, these are on higher-end cars. You will find that these lease deals are better than you would get on buying the same vehicle models. If you fancy luxurious vehicles, this could be your best option. Normally, luxury vehicles offer low-price lease agreements since such cars also have higher residual values. This means that by the end of the lease period, the vehicles will worth more than their non-luxury counterparts.