To help you drive home a car that’s perfect for you, Zimbrick at Fish Hatchery Road, your local car dealership in Madison, WI, offers both leasing and financing options. But what’s the difference between the two, and which one should you pursue? This guide will answer your questions and help you decide.
Leasing vs. Financing
What is leasing?
When you lease a new car, you have the vehicle in your possession for a fixed term (usually 3 or 4 years) while making monthly payments. You only have to pay for the cost of using the car for that time frame, as opposed to paying for the entire car. When the term is up, you can return it to the dealership and sign a new lease for a different car, or you can choose to buy that car.
Some benefits of leasing a car include:
- Little to no down payment
- Low monthly payments
- Get to enjoy a new car every few years
One thing to keep in mind is that most lease agreements have a mileage cap usually between 10,000 and 15,000 miles per year. While you can exceed the limit, you may have to pay a fee. For this reason, leasing a car is well-suited for people who don’t drive a lot or who don’t travel long distances frequently.
What is financing?
When you decide to purchase a car, you’re expected to pay the entire dollar amount on the price tag. Most people can’t just buy a car outright, and that’s where financing comes in. Financing options include car loans, trade-ins, and down payments to help make the monthly payments more compatible with your budget. Once the car is completely paid off, you will own the title.
Some benefits of financing a car include:
- You build equity
- Ability to modify and customize
- Can sell the car after payments are complete
Financing options are available for both new and used cars and for people who have no credit history or poor credit history. Because car loans can be acquired through an array of different lenders, whether it’s the manufacturer or a local bank, there’s a lot of flexibility.
Need Help? Visit Our Finance Center
Zimbrick at Fish Hatchery Road is here to help you navigate the car-buying process. We have an auto finance center on-site and offer car lease deals and specials to help customers find more ways to save. If you have any questions about leasing or financing a vehicle, contact us today at (608) 270-7799.
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