Make an Informed Decision on Buying vs. Leasing

The decision to lease or buy a car is one that many of Irvine Subaru's orange County customers are faced with during their visit to our dealership. Of course, the decision is always relative to personal circumstances. However, if you're well-informed before entering our dealership, you can feel empowered the moment you walk through the door and that's what we want for you and your experience.

You'll be pleased to know that our finance team is extremely knowledgeable and works in tandem with numerous lenders to get our customers optimal financing as well as the best car lease deals. Our dealership also works with many lenders throughout the Anaheim area, including credit unions and finance companies.

There are a few important questions that Tustin shoppers need to first ask to determine the option that is best for their current financial situation and plans. Keep in mind that used vehicles generally can't be leased.

How long do you anticipate keeping the car?

The biggest difference between buying and car leasing is what occurs at the end of the contract. When buying a new vehicle, at the end of the contract, the car is yours to keep as long as all payments have been satisfied.

With a lease, you can either turn the car into the dealership or keep it. Keeping it requires new financing or other means of paying the agreed-upon purchase price. If you plan on keeping a car for a long duration, then buying may seem like a wise decision. But if you're like many people in Laguna Niguel, there's an appeal to getting something new every three to four years. Estimating how long you anticipate keeping the car should be a primary factor in making your decision.

Can you make a substantial down payment to keep your monthly payments within your budget?

There's no rule that says you need to have a certain amount for a down payment; however, lenders typically like to see a reasonable amount to reflect your commitment. After all, it's a partnership agreement. Would you want to do business with someone who is only capable of an extremely minimum investment? Probably not! But lenders take that risk every day, and it may result in a higher annual percentage rate (APR).

With a lease, the down payment and fees are already established, rather than using your finances. Although there are instances when a higher down payment is requested, typically you can budget exactly how much is needed before you even take your first test drive. It's an exceptional benefit and takes a lot of the guesswork out of your decision.

Do you have a challenging credit score that could impact being approved for buying or vehicle leasing?

Every application is based on a person's credit situation, regardless if it's a lease or purchase. With that being said, there is no secret in our industry that car leasing lowers the lender's risk. During the risk assessment, it is understood that the car most likely will be returned at the end of the contract, which is a factor that the lender takes into consideration when deciding to make a credit decision.

When you choose to purchase, a larger down payment is generally helpful to off-set a low credit score. Additionally, you have ownership of the equity in the vehicle and it can be included in your financial portfolio as an asset, as long as you've reduced the liability enough. The cause of a low credit score can sometimes be due to being financially overextended and a lease is an option to maintain a budget that may be better managed.

Discuss Your Options with Irvine Subaru in Lake Forest

If you would like to discuss buying vs. leasing further, we welcome you to stop by our dealership or give our finance team a call. You can also get a head start on the process of getting approved by filling out our secure online credit application.Our commitment is to always provide our customers with a satisfying experience, and we look forward to assisting you with your decision.