What is the Difference Between Buying and Leasing a Car?
What is the Difference Between Buying and Leasing a Car?
While buying a new car should be an exciting experience, when it comes to choosing whether you want to lease or own the vehicle, it’s common to feel indecisive. Is it better to purchase a new car outright or would leasing be more beneficial for your needs? For many people, buying a car seems like the most sensible option, at least from a financial perspective. However, other Knoxville drivers choose to lease a new car because they can save on monthly payments and trade-in their vehicle every 3 years or so to get a newer model. Keep reading to learn more and feel confident that you’re making an informed decision when purchasing a vehicle at Toyota Knoxville.
The major difference that shoppers need to remember with buying a car versus leasing is all about ownership. When you buy a car outright, you can enjoy full ownership over the vehicle and do with it as you please. This means you can add a new roof rack, get a fancy new paint job, upgrade the suspension, and sell it to whomever you’d like when the time comes to move on. However, when you lease a car, you’re essentially a temporary owner. Extensive customization is out of the question with a leased car but that doesn’t mean there aren’t advantages to leasing as well.
Often, the most appealing perk of leasing a car is the option to upgrade or change out the vehicle every 3 years or so. Additionally, leasing a vehicle doesn’t typically require drivers to make high monthly payments because you’re only responsible for paying for the depreciation on the car during your lease term. Other differences between buying and leasing a vehicle are detailed below.
| Buy | vs | Lease |
| Cash price or down payment due at signing, registration, taxes, and other fees. | Upfront Costs | First month’s payment, down payment, and refundable security deposit due at signing. Taxes, registration, and other fees apply. |
| Typically, higher monthly payments because you’re paying off the total purchase price. | Monthly Payments | Generally, lower monthly payments because you’re only paying for the depreciation on the vehicle during your lease term. |
| Zero mileage restrictions. | Mileage | Usually limited to 10,000 miles per year. Additional fees apply for exceeding the mileage limit outlined in your lease terms. |
| Once your car loan is paid in full, you are free to sell or trade the vehicle whenever you want to purchase a new one. | End of Term/Vehicle Return | Once the lease term is up, you can return the car and either lease or purchase a different vehicle. |
Should I Buy or Lease a Car with Toyota Knoxville?
So, what is the best option for you as you look to bring a new car into your life? Unfortunately, there’s no “one size fits all” answer with so many different factors involved. As a good rule of thumb, it’s important for car shoppers to take time to consider your needs, budget, lifestyle, and preferences when choosing whether to lease or buy. For those interested in paying less over a shorter amount of time, leasing is a great choice. But for anyone who really wants to enjoy full ownership over their vehicle, buying outright is likely the way to go. Ultimately, the choice is very personal and not something that should be taken lightly.
Still unsure whether leasing or buying is right for you? At Toyota Knoxville, we’re always here to help and explore your options. Don’t let the fear of commitment one way or the other prevent you from driving around the greater Knoxville area in the new Toyota model of your dreams!
Visit Toyota Knoxville to browse our inventory or schedule a test drive online with us!
