Explore the differences between leasing and buying a car to help with your decision.
What is car leasing?
Leasing is a form of financing to consider when you don't want to keep the car for longer than a few years. You typically pay a down payment at signing and then make monthly payments on the depreciation of the car over the term of the lease.
Once your contract is up, if you’re loving the vehicle, you’ll have the option to purchase it via a lease buyout. Or, you can simply return it to the dealership and, if you wish, pursue a new lease.
Consider leasing a car if you:
- Enjoy driving a new car every few years
- Want a lower monthly auto payment over a similar term as opposed to purchasing a vehicle
- Expect your transportation needs to change within a year or two
- Drive 15,000 miles a year or less
What should I know about buying or financing a car?
If you intend to keep the car for many years, financing to purchase may be a better choice. You pay the entire negotiated price of the vehicle using cash, financing, the value of your trade-in, or a combination of all three.
Consider buying a car if you:
- Plan to own the vehicle for more than five years
- Plan to continue driving the vehicle after it's paid off and enjoy the freedom of no car payments
- Will likely drive your vehicle more than 15,000 miles per year
- Enjoy customizing your car or truck
Car buying tips
Things to know before you start shopping for cars and auto loans
This article offers helpful tips for your research in finding the right financing options for you.
How to choose the best car loan for you
Deciding how you’ll finance your car is a major step in the car buying process. Here are some tips to make it easier to find the right financing for you.
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Get tips to help you decide whether a used car or a new car is the right fit for you.