Should you lease, buy new, or buy used?

Image by nateOne via Flickr
Buying a car is always an interesting endeavor. It is both exciting and challenging, and sometimes scary.

Whichever of the above applies to you, there are basically three general options available to potential car buyers. To lease a car, buy a new one, or buy a used vehicle. Each has several pros and cons.

Leasing is a popular option for many. Typically your payment is lower than it would be if you just purchased the car with a loan. You can lease a car for so many years and then simply turn it in and lease or buy another one. The nice thing about a lease is that you aren't saddled with your purchase and it's declining value after the lease period ends.

Now for the cons, and there are many. The biggest downfall is that you are paying all that money essentially with nothing to show for it. Unlike a purchase, when the lease is up the car goes away.

Most leases also limit the amount of mileage that you can drive per year. This is a disadvantage to those that have to drive long distances or with any frequency.

You are also liable for any damages to the vehicle that are beyond normal wear and tear, so that means no street racing!

Buying a used vehicle is an attractive option as well. For those who are affluent in vehicle maintenance, this is the way to go. The previous owner has already absorbed the initial depreciation of the vehicle. On a slightly used, low mileage car you can save thousands of dollars. Most new vehicles come with transferrable warrranties.

If properly cared for, a used vehicle can be a far superior purchase to a new car purchase. The key is to look for potential damage or "lemon" qualities, along with checking to see if the car has been in an accident or has a salvage title. This can potentially be a nightmare if you are not educated in vehicle maintenance.

The final option is to purchase a brand new vehicle. This is a positive way to go if you don't know much about vehicles. Most new cars come with a warranty that ranges in length from 36,000 miles up to 100,000 miles. When you buy a new car you don't have to worry about the previous owner and whether or not there is hidden damage.

When properly cared for, a new vehicle will last for a long time. However, a poor credit rating can cost you a fortune in interest fees. As soon as you drive off the lot the car depreciates in value.

The most important thing when making any kind of committment to a vehicle is to do your research. Make sure that you don't just pick the car that you like because it looks good or has that electronic widget that you like. Choose a car that is reliable and dependable. Making a decision with your head instead of your heart will go a long way towards saving you money down the road.


src="http://pagead2.googlesyndication.com/pagead/show_ads.js">