|Advantages Compared to Leasing
||Sep 26th, 2012
With an auto loan, each monthly payment you make goes toward eventually
owning the vehicle yourself. When the loan is paid off, you own a piece
of property. In a lease agreement, you rent a car for a specific time.
At the end of your lease contract, you have the option to buy the
vehicle or return it to the dealer. Auto loans do not limit the amount
of miles you can drive the car before incurring costly over-mileage
charges, as is the case with a lease. Another consideration is auto
insurance. If you finance through a loan, the amount an insurance
company will pay for damage depends on the market value of the vehicle.
When a leased vehicle is damaged, the dealer's repair costs often are
greater than the insurance company will pay, leaving you responsible to
cover the difference.