What’s The Difference?

Decisions, decisions, and even more decisions! Everything you do in life comprises decisions, especially when you are on the lookout for a brand-new car from Davis Honda.
In this aspect, the most important decision you will make is whether you will lease it or finance it. There are indeed a lot of factors that will affect your final choice. However, no decision is ever truly complete without proper research. 
In this feature, we have put together what financing and leasing are and the differences between the two. By the end of this article, you are sure to make a well-informed decision!
So, let’s get started!
 

What Is Leasing?

In simple terms, leasing is where you borrow an automobile from a dealership for a short time. You will be paying for this through a loan, and at the end of this, they will want you to return the vehicle in tip-top shape. This will allow them to resell the vehicle. 
The major advantage of leasing a vehicle is that you get to drive around town on the latest cars for a small amount. In addition to this, the burden of selling the car after use is not on you. 
However, the disadvantage here is that the dealership you rent it from might start charging you huge amounts for mileage. Moreover, they might also ask for more money to clean and repair the car at the end of the loan period.  
 

Pros Of Leasing A Car

• You will not have to pay huge sums of money to lease a car
• The warranty period continues when you are on the leasing period, which covers damages
• There is no problem with re-selling the car or trading it

 

Cons Of Leasing A Car

• Once you cross a certain mileage limit, you might have to pay extra to cover the distance
• You will have to cough up money if it is damaged during the lease period
• You will also have to pay more money if you end the lease period before the due date

 

What Is Financing?

When you finance a vehicle from a company, you buy it from a dealership like Davis Honda through a loan. This loan will involve you paying amounts regularly to the dealership until you have paid off the entire amount of the car. 
The prime advantage here is that you will be the sole owner of the car. Once the payments are made, the car is transferred from the dealership to you permanently. 
However, the disadvantage is that you will end up spending a lot more money than leasing a car. 
 

Pros Of Financing A Car

• The mileage limit does not apply to you once you purchase the car for yourself
• There is no extra cost for damage and repairs
• With financing, you can sell the car or trade it in later for a better value

 

Cons Of Financing A Car

• You will spend 60% more money than leasing a car
• You need to make huge down payments
• The cost of repair and maintenance is on you once the warranty period ends

 

Leasing Vs. Financing: Here’s The Difference!

Ultimately, the only major difference between the two is the ownership factor.
If you plan to lease a car from a Davis Honda dealership, you will not have complete ownership of the car. Instead, you will simply be “renting” the car for a short time. During the lease period, you will be required to pay small amounts of money for insurance. 
When this lease period comes to an end, you will return the car to the dealership. However, you also have the option to renew it or buy it. 
On the other hand, financing is where you buy the car, which permanently makes you the owner. 
Additionally, the payments for a lease are also much lower than the cost of financing. In fact, there is a 30% to 60% cost difference between the two!
Moreover, with leasing, you also do not have to worry about the problem of maintenance for a long time. Furthermore, you have the warranty period backing you up. 
On the other hand, the cost of maintenance and repair will fall on you. You might have the warranty period to cover you a while, but once that ends, you will have to hand over huge sums of money to keep your car in good shape. 
 

Leasing Vs. Financing: Which Is the Best Choice For You?

The ultimate decision of choosing between leasing and financing a car solely depends on you. 
However, if you need our advice, you can choose to finance to own a car permanently. This way, you can drive around anywhere with ease. 
On the other hand, if you want to use a car for a few weeks, you can lease a car from a dealership like Davis Honda. 
 

Wrapping Up

Lastly, whether or not you wish to lease or finance a car, the ultimate decision boils down to your intentions in the long run. If you wish to drive around town sporting a new car every week, leasing would be the better option financially. 
But if you wish to make a huge payment once on a car, you would use it till it turns to dust, financing it would be the best option.
Whether you wish to lease or finance a car, the experts at Davis Honda dealership can work with you on all your requirements and get you a car that perfectly fits your budget and lifestyle.
Visit our website if you'd like to see how we can help you make the perfect decision!