What are the differences between leasing and purchasing a vehicle?

When you’re looking into getting a new or used vehicle, there’s often a lot to consider. What size engine do you need? Which drivetrain is best? One of the most important questions you should answer for yourself is whether you want to purchase or lease the vehicle. However, many don’t know the difference, and making big financial decisions can be overwhelming. That’s why we’ve made this easy simple guide to explain the differences between leasing and purchasing a vehicle, and some of the pros and cons of each.

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What is Purchasing?

When you purchase a vehicle, you’re either buying the vehicle with cash or using financing. Both are different steps toward the same goal: making you the owner. Most buyers don’t have the cash on hand to outright purchase a vehicle, so they choose to finance. When you finance a vehicle, you make a set monthly payment (after a down payment) towards owning the asset. It’s in your name, as is the loan. You can get the loan from a bank, credit union, or through your dealership. Once the loan is paid off, the vehicle is yours. In the meantime, you’re free to treat it as you’d like – with modifications, upgrades, and anything else you desire.

What is Leasing?

Leasing is similar to buying, but with a very different outcome. When you lease a vehicle, you’re essentially paying the dealership to drive the vehicle for a specific term. The vehicle remains theirs and is never in your name. You often have set terms, like mileage and wear and tear, that you must follow to stay within the terms of the lease. Then, once the lease expires, you’re free to return your vehicle to the dealership for a new one or you can choose to purchase.

Pros of Purchasing and Leasing

Cons of Purchasing and Leasing

Purchase or Lease at San Jose Mitsubishi

Once you decide to purchase or lease a new vehicle, you can contact us here at San Jose Mitsubishi to get started! We offer in-house financing and leasing options, so you can get in your new or used vehicle faster at the best rates. Still have questions? Our sales and finance teams are here to help!

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