Why do people lease rather than buy?

Question

Leasing usually costs more if you focus on a 10 year ownership.

Buy a car and use it for 10 years. Drive it free for 5 years (no payments).

Lease 5 cars on 2 year leases and always have monthly payments.

Rather than having a new car in your driveway, what are other advantages of leasing?

Answer 1

Everything is under warranty.

Answer 2

Some advantages for leasing are that you can use the latest model cars for a lesser amount and when you want to get rid of it, you won't have to look for a buyer. The dealership will do that as part of their service.  

Answer 3

It's really kind of a skewed argument because it doesn't take a rocket scientist to figure that either leasing or buying/trading a new car every 2 years costs more than buying and keeping one car for 10 years.

The difference is that many people, like myself, like having a brand new car every 2-3 years, like having lower monthly payments, don't mind that I'm always making payments, having a car that is always under warranty, don't like the hassle of selling/trading used cars, and having the latest technical and safety equipment.

But that's just me. I don't mind the long-term extra cost, like I don't mind the long-term extra cost of using credit cards, or buying meals at restaurants instead of cooking at home.

BTW, when you buy a car with a 5-year loan and drive it for 5 more years, it's not free. You already paid for it in advance, and for every year and mile that you use it, it depreciates in value. It's money you never get back. Nothing is free.

Answer 4

The only real advantage is that you can lease a car that you normally wouldn't be able to afford (through financing) because you won't own it in the end.

Answer 5

basically, its for people who changes cars often (usually after the 4-5 years of the lease) and dont intend to drive that car for the rest of its life.

Instead of paying $30,000 on a luxury vehicle, they lease it, and only pay $18,000 or $20,000 . Then at the end of the lease, they can lease a different car or look for something to buy that is new.

They are spending less. Dont have to worry about selling the car, and dont have to deal with higher payments, if they outright buy a car.

so for a lease user: they can have a new car every 2,3,4,5 years. Whereas a person who outright buys a car, can only afford a new car every 7,8,9 years (and deal with the hassles of financing)

Answer 6

(1) some people don't know better.  I read all the time, "I leased a car, how do I SELL IT".  The really don't understand lease is renting

(2) some people don't like the hassle of selling when they are done with the car.  The are not really concerned with extra cost.

(3) other only focus on the current "lower" payment - not realizing that that is just a "hook"

Good luck...

Answer 7

You get the plus of paying penalties and fees for going over your mileage limits.  It is definitely better to buy.