Overhaulin'

Car Lease vs. Buy?Which one is better? Im a college student with a somewhat steady income and I want a new car?

I want to know if it is smart to get a car lease because I don't want to be held down with bills for 36 months.Like can I cancel he lease if I cant pay or is it required to only do repo? Also what if i want to buy it after y time is u do I have that option?

Public Comments

1. a lease also constricts you to 36 months but at the end you have no car unless you pay some boot to keep it. if you break the lease it's the same as a repo. I would buy a cheaper used car until you're out of school and know what you're going to do
2. Sorry man, you need to do some serious research on leasing if you're asking questions like "can I just cancel the lease" or "can I buy it after the lease is up". You're setting yourself up to get suckered. As a college student, you probably haven't built up enough credit to lease. Leasing requires a significantly higher credit score (especially in today's market) than traditional financing. And you would need verifiable, steady income. A part-time job netting you $1000 a month wouldn't even catch the lender's eye. Leasing isn't a magic way to lower payments. Not everyone qualifies, and not everyone SHOULD lease if they do qualify.
3. You can't cancel a lease without paying a large penalty. You also have to return the car in perfect condition or you will be billed for repair costs. You pay interest on a lease and have limited mileage available to you and you will be billed for anything over that allowed mileage. There is always a buy out option at the end of the lease, usually for quite a large chunk of the car's value (the buy out on my $19,000 (all taxes and fees included) car after paying $328 a month for 48 months - that's more than $15,000 - was an addition $10,000 so the car ended up being $6000 more than it was worth). With the purchase interest rates most companies are offereing (0.9% over 5 years or in most cases 0% if you pay it off within 3), you're much better off just buying the car.
4. When you buy a car, you buy it. When you lease a car, you rent miles. If you miss a payment on the lease, just like if you are buying, it's subject to repossession and all that entails. At the end of a lease if you have gone over in miles, you owe. If you have done damage beyond normal wear and tear, you owe. And yes, you can buy it at the end of the lease for it's value. But buy or lease and you are held down with bills for 36 months. Yes, you can cancel a lease, but you don't just walk away when you do, there are fees to be paid which can be high. Make sure you read things before you sign. I'd suggest a used car that you can pay cash for until you're out of school, then you can think "new".