Friday, June 7, 2019

Should You Lease or Finance Your New Car

You have done all your research and have narrowed down your next new car. You know the options and equipment you want, and you even know what dealership has your dream car in stock. You have it all planned out. Now it is time to figure out how to you are going to pay for it. Some will pay for the car outright while for others that is simply not an option. So, they need to arrange for funds to pay for the car. Spieler’s Incorporated will explain the two most common ways to pay for your new ride at our California, MO dealership and the differences between the two.

Financing Your New Car

Most of us have borrowed money in some form or fashion. Auto financing is very similar. You have a couple options here. You can inquire about financing through your local bank for an auto loan or allow the dealer to obtain financing for you. The dealer will collect information from you and submit that information to lenders they use and then the dealer will present the offers to you. You will agree to pay back the amount borrowed over time plus the finance charge. The finance charge is simply the interest rate of the loan. The lender will pay the dealership and you will make payments to the lender who holds the financing for you.

Leasing Your New Car

Like financing, a lease is a method of obtaining funds to pay for a new vehicle. Unlike financing, where you are paying on the car for so many years then you own the car. When you lease a vehicle, you are not paying for the entire amount of the car. You are only going to paying for time you will use the car. So, when you lease a new vehicle you are only paying for the portion of the car you are using in the number of years in the lease agreement. Which is typically two to four years. That portion you use is the amount of depreciation the vehicle will suffer over the length of the lease. Miles you put on that car are also limited. A lease can be done right through the dealerships finance office.


There are advantages and disadvantages to both options. For instance, a lease payment will typically be less because you are only paying for a portion of the car. Where when you finance you are buying the whole car. When you pay off that loan though the car is all yours as to where when you pay off the lease there is still a portion of the car not paid for. When you lease a car and the term is up, you simply return the car to the dealer. You have a couple of options, you can buy the car for a predetermined amount, or turn it in and walk away. Many folks that lease a new car will simply lease another once the original lease expires. That way they can stay in a brand-new car that is typically always under warranty. But that buyer never has any equity made in the vehicle.

The best scenario for you will decide on your financial position. Hopefully, this information answers some questions you had and explains the difference between conventional financing and leasing. If you have any additional questions, please reach out to the friendliest and most knowledgeable sales staff in our mid mo car dealership. Spieler’s Inc will help you find your new vehicle and help you arrange a way to pay for that new vehicle. 

Proudly Serving the Columbia,
Jefferson City, and California, MO Areas

1109 W. Buchanan St.
California, MO 65018
(888) 455-2107


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