Buy Or Lease, What’s Better?

The decision to buy or to lease a new car from a Volkswagen dealer in Orland Park is one which must be made after carefully analyzing your needs and your finances.

For the majority of new car buyers, buying means financing the purchase over an agreed upon period of time and making payments every month during the period. This being the case, eventually the car is actually owned by the buyer. A car that is owned outright has some equity, and if you are so disposed you can trade this equity or value for a lower price on the next car you buy. If your circumstances are such that you plan on keeping the car for a long time then purchasing makes a great deal of sense.

Leasing a car from a Volkswagen dealer in Orland Park is akin to renting the vehicle for an agreed upon period of time. The monthly lease amount, call it a rent, is based on what the value of the car is expected to be at some time in the future. This value, called residual value is based on resale values from the past as well as the present and a good idea which direction these values are going. A high resale value is commensurate to a lower rate of depreciation; the result is a higher residual value. When you lease a car, your lease payment covers the projected depreciation when the lease up the depreciation of the car has been offset by the money you paid over the lease period.

When a car is leased there is a considerable difference in the down payment, it is lower than what would be expected if the car was being purchased. Along with smaller payments every month a person who leases can typically have a more expensive vehicle than might be possible with a purchase. A lease allows the person to change the car more often, there are also no issues about trying to sell it or negotiate a decent trade in value; when the lease is up you return the car and walk away from it.

Having said all this, leasing a car is not recommended for individuals, it is a method that is better suited to a corporate plan. For an individual, it is usually better to buy the car from a Volkswagen dealer in Orland Park, look after it well, and pay it off as quickly as possible. Once the car is yours, keep it in good condition and reap the rewards of a lower cost of ownership.

If you are looking for a Volkswagen dealer in Orland Park you are invited to visit Hawk Volkswagen of Joliet. Depending on your needs Hawk Volkswagen can either sell or arrange a lease on a new Volkswagen. Visit us at hawkvw.com.

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