Leasing a Vehicle

Buying a new car can take more than a second thought with the economy as bad as it is, but what is the best way if you’re in dire need of a new vehicle?

Ask Yourself:

– What is my purpose of the car for? If there is a business connection, leasing would most likely be better.
– How long do you usually keep your car? If 5 years or more, then consider owning the vehicle
– Do you need specialized equipment in the vehicle such as disability? With a lease, you may be able to afford it with these specialized equipment, but if you’re leasing it at the end of the term, the vehicle technically isn’t yours. This situation is a little mixed between both.

Leasing:

Pros:

– Costs less upfront – usually a security deposit and first month’s lease
– The way monthly payments are calculated, you’re only paying for the amount of time you use the vehicle based on depreciated values at the end of the term.
– Maintenance is shorter than financing and less warranty issues and extra repair bills
– If you’re self-employed or if your employer requires you to drive for work, you can write off the interest on the vehicle purchased, but if you lease, you can potentially write off the entire payment. The employer can sign the T2200 to determine exactly what write offs you are able to have.

Cons:

– Need to know how many kilometers you are driving – there may be excessive kilometer charges or wear and tear. Know your driving patterns before the leasing agreement to set yourself up with a proper lease

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