When Is Car Leasing an Advantage To You?
If you are a business owner in need of a car for your business, then you must consider the advantages of leasing over purchasing. In this article, let’s discuss the benefits of getting a car lease and how to find a good lease deal.
Car Lease Advantages
Leasing a vehicle means renting a car so you can get to use it without submitting full payment. The lessee has the option to rent the car for a certain time period, pay in installments, and get full ownership of the car in exchange for a small lump sum payment at the end of the lease term.
Yes, when your lease term end, you may choose to get the car for a lower price than its market value. On the other hand, if you don’t want to keep it, you can simply return the car to the leasing company.
While purchasing a car requires a big sum of investment, leasing gives you more flexibility to decide your next action based upon the financial status of your business.
Comparing additional costs
Does leasing require a down payment? Yes, a car lease does require a reasonable amount of down payment. Generally, you can obtain a car lease for a down payment worth $1,000. That is a very small amount of investment, compared to purchasing which would require you to put down at least 15% or 20% of the car’s price.
What other costs should you expect from a car lease? Most lessors impose a limit to your mileage within the lease term. That means, you may be charged with additional fees if you exceed the allowable mileage.
Weighing the consequences
Since a car lease imposes a mileage limit, purchasing may prove to be a more practical choice if your business requires a lot of travelling. Therefore, you should carefully consider the differences between the leasing and purchasing. If you need to use the car on long trips, you might be paying a considerable sum on excess mileage.
Clearly, while leasing a car for business has its advantages, the consequences must also be taken into consideration. Before making a decision, check out the packages or lease options that car leasing companies offer. Apart from the costs, be sure to understand the leasing policies and terms of your chosen lessor.
Irish Taylor is a bussiness loan consultant with Startup Business Loans and has been providing consumers and business owners with startup business financing since 1992. For years she has helped people with credit and loan problems especially pertaining to business start up, SBA loans and Unsecured loans.
Copyright 2010.
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