A: To answer this question we suggest you profile yourself. Consider the following:
Lease? Leases are offered primarily on new vehicles. When you lease a vehicle, you are basically renting it. If every two to four years you need a brand spankin’ new car or truck, leasing might be for you.
You don’t own anything when you lease, but your payments will probably be less. Lease payments are primarily determined by what the vehicle costs new and what it will be worth at the end of the lease (residual value). Typically, vehicles that hold their resale values well will be less expensive to lease; vehicles that depreciate rapidly will cost more to lease.
You will have an initial cash outlay with a lease, you will have to closely monitor miles, and you need to take care for your vehicle. A lease is difficult to terminate before maturity. You will pay out of pocket for excessive miles and wear and tear at the end of the lease. If you use your vehicle for business purposes, there may be tax advantages to a lease. (Consult your tax advisor.)
Buy? Are you buying a pre-owned vehicle? Do you keep your vehicles for a long time? Do you drive more than 15,000 miles per year? Don’t want to be forced into a decision about buying another vehicle at the end of a lease period? Buying for business use? Buying may be a better option for you.
Information provided by Tab Miller and Mona Lillard, Preowned Solutions, 11010 Douglas Ave., Urbandale, 515-528-8100.