Why We Love Car Leasing (And You Should Too!)
Posted: 28th April 2017
Car leasing is one of the most popular ways of getting a car and for good reason. If you have never heard of car leasing or if you’ve heard many of the misconceptions about it, we want to help you understand why you should love car leasing.
It is the cheaper option
Car leasing is often confused as being more expensive than buying a car through car finance. It is in fact, cheaper to lease a car than it is to finance one.
Traditional finance works by paying off monthly payments to cover the value of the car. With a leasing option, you are paying the cost of depreciation on the value of the car. The cost of a lease equals the value of the vehicle at the beginning of the agreement minus the depreciation. This makes it cheaper than finance options that require you to pay off the entire value of the car.
The only thing that greatly alters how much you pay monthly is the annual mileage allowance that you set yourself at the start of the lease. If you plan to travel much more, the car’s value will depreciate faster. The average mileage yearly is close to 10,000 miles. If you drive. for example, 30,000 miles a year, then the car’s value will depreciate faster. Your monthly payments will be higher as a result.
No need to worry about depreciation
When you purchase a car, depreciation is something you have to deal with. A car can lose up to 50% off its value when you drive it out of the showroom. If you then drive it over the next three years, the value of the car will have dropped significantly.
The curse of depreciation affects all those who buy a car. This never extends to those who lease a car. With car leasing, you don’t take ownership and simply hand the car back. This means you never have to deal with the hassle of depreciation and selling the car on. The monthly payments you pay to lease a car only cover the value of the depreciation rather than the value of the car.
Car leasing is flexible
Car leasing is designed to help as many people as possible drive away with a car. There are different car leasing & finance options which aim to be affordable for those in different circumstances. Car leasing for those with a deposit and good credit will see themselves with the lowest monthly payments.
However, if you don’t have or don’t wish to place a deposit, that is great. Zero Deposit Car Leasing requires no deposit to lease a car. As expected, your monthly payments will be slightly higher if you don’t place a deposit.
Credit ratings have an important effect on how likely you are to be accepted on either a leasing or finance deal. If you have poor credit, you will unlikely be accepted for the usual leasing agreement. However, because car leasing is designed to be as flexible as possible, there is car leasing for bad credit available. This may result in higher monthly payments, but if you can prove you can afford them, then you stand a good chance of being accepted and being able to build up your credit rating whilst driving an upgraded vehicle.
Leasing ends without any hassle
Car leasing offers you no such hassle. When your leasing agreement comes to an end, you simply hand the car back. After that, you can start a new leasing agreement and move on. Simple and easy.
We think leasing is a great way to get into a car and if you want a leasing agreement, a no deposit car lease or a bad credit car lease, we have a great selection of cars available now.