Q:

What are the advantages of leasing a car?

A:

Quick Answer

Advantages of leasing a car include the possibility of a better car for less money and bypassing the need for a hefty down payment, according to U.S. News and World Report. Another advantage is the fact that many leased cars are covered under warranties.

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What are the advantages of leasing a car?
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Full Answer

U.S. News and World Report explains that while car loans are based on the entire price of a car, a car lease is based on the difference between a car's price and its predicted worth at the end of the lease. For instance, a person who leases a $20,000 car that is expected to be worth $11,000 after a three-year lease makes lease payments on $9,000. This approach enables people to lease a higher-quality car than they would be able to buy.

Also, as U.S. News and World Report says, down payments for car leases are not always necessary, although they can sometimes run to a few thousand dollars. While a higher down payment means lower monthly payments, a person can get a good-quality car through leasing and not need a down payment. Since three years is the typical length of many leases, the cars are covered under warranties for any necessary repairs. Having the latest features is another advantage of leasing.

How Stuff Works points out that people who claim their vehicles as business tax expenses can realize significant tax breaks.

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