Should I Lease or Buy My Vehicle?

After spending some time with our sales staff at Southland Kia, surely you’ll have chosen the vehicle of your dreams. Before you can drive off in your new or used Kia, you’ll have to make a decision about your payments.

A lot can be said about your choices, and the fact is that there are advantages and disadvantages in both leasing and financing a vehicle.

Leasing

When you lease a vehicle, you can end up paying a lot less than if you had financed that same car. This is why a lot of people are quick to lease because, in theory, you can get in a nicer vehicle for a lower price.

The reason for the lower price is that you actually pay for just a portion of the depreciation of the vehicle over a pre-arranged term. You don’t gain equity with that money, however. You’re effectively renting the car over a prolonged period of time.

This is a great choice if you don’t want to commit to a vehicle for its entire lifespan. At the end of your lease term, you have the choice to give the vehicle back, upgrade to another or a newer model, or even buy it from the dealership.

Some Other Points to Consider About Leasing:

  • No loan required
  • Simple termination
  • Lower maintenance costs - vehicles are usually under warranty for the life of a lease
  • Limited mileage
  • No freedom in modifications

Financing

Should you decide to finance a vehicle, you’re making the decision to become the owner, over time. With each payment, your money goes towards your equity in the vehicle and in most cases - towards the accumulated interest.

In the long-term, financing a vehicle can be a more financially responsible option. Though the payments are typically higher than that of a lease, when your term reaches maturity, you are the owner of the vehicle. You’ll then have the luxury of a vehicle without payments.

The downside though, is that in most cases, you’ll be required to make interest payments on your vehicle throughout your term. Also, the vehicle often depreciates more quickly than the loan can be paid down, resulting in a loss should the time come to sell. This is especially common in longer financing arrangements.

Some Other Points to Consider About Financing:

  • You build equity in the vehicle
  • No limitations in mileage or modifications
  • The option to trade-in the vehicle is available
  • You’ll be responsible for all maintenance outside the scope of your warranty

Before you buy or lease, be sure to take a look through our Special Offers page to see our current promotions. Just another way we help you save at Southland Kia.

At Southland Kia, we highly encourage you to weigh your options before jumping into a decision. Make sure to ask yourself, “Why is this the best payment option for me?” If the answer isn’t clear, our team of expert financiers is at your disposal to discuss all of the options available to you and their implications.

Should you need any more information, feel free to get in touch with us through our online contact form, or drop by for a visit. We are conveniently located just off the Trans-Canada Highway in Medicine Hat, exit at 13th Avenue.