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Financing Vs. Leasing: Which Is Right For You?

Financing Vs. Leasing in Byron Center, MI

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There are two major ways to get a car: financing and leasing. Naturally, you can pay for your new car in cash, but most people choose to finance through the dealer or a bank, and many others opt for leasing. Though there are advantages to each of these methods, it largely depends on your driving habits and financial situation. Read on to learn more about the differences between financing and leasing.
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Financing

Financing requires you to make a large down payment (about 10 percent of the sticker price) and then pay the rest in installments. You also pay a small portion of interest on the amount of money you borrow. The major advantage to this method is that you get to own the vehicle as soon as you finish making payments. That means you have equity invested, and you can save more money in the long run compared to leasing.

The disadvantage to financing is that it usually requires more money up front and monthly payments are often higher. Depending on your financial situation, including your credit score, it can be difficult to afford financing.

Leasing

Leasing is much like renting—you pay little to nothing down, and you pay small monthly installments. You don’t own the car when your lease contract is up, but you also tend to pay less than you would when you finance. Leasing often requires you to do regular maintenance, but many parts are covered under warranty. Plus, with lease contracts you get a new car every few years—perfect for people who love variety.

The disadvantage to leasing is that you don’t get to keep the car when the lease is up, and you also have to pay for oil changes and other regular service. There can also be mileage restrictions as well, though these are often based on the average driving for Americans (about 12,000 miles, though it can be more).
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These are the major differences between financing and leasing. Depending on your background and driving habits, one might be better than the others. Have questions? Call or stop by our Finance Department today.

Hours

  • Monday
    7:30am-7:00pm
  • Tuesday
    7:30am-6:00pm
  • Wednesday
    7:30am-7:00pm
  • Thursday
    7:30am-6:00pm
  • Friday
    7:30am-7:00pm
  • Saturday
    8:00am-3:00pm
  • Sunday
    Closed

Contact Information

8250 Pfeiffer Farms Drive
Byron Center MI 49315
Phone: (616) 583-0184
Fax: (616) 583-0162
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