Ride or own: 5 cases when leasing is more profitable than a loan
Credit remains the key financial instrument for acquiring new cars in Russia. The main reason for its popularity is simple and clear: car owners are accustomed to “pay for their”, gradually buying the car. Against this background, leasing seems to be something ambivalent: on the one hand, it is easier and less to pay, and on the other, the machine seems to be a stranger … But we will look at the situation from the outside: here are 5 cases when acquiring a car on lease is clearly better than a loan .
YOU ALREADY HAVE A MORTGAGE OR OTHER CREDIT
As you know, the leasing scheme is fundamentally different from credit in that the owner of the car is not the bank, but the lessor — and he also assumes the obligations of insurance, paying vehicle tax, servicing the car, and so on. Thus, leasing is not a credit product – that is, it does not affect credit opportunities and does not depend on credit obligations. Simply put, if you already have a mortgage or another outstanding loan, it may be difficult to get another loan to buy a new car – and vice versa, taking a loan for a car, the car buyer limits his ability to buy real estate and get new loans until the current loan is paid. Leasing completely solves this problem: by purchasing a car according to this scheme, you do not have any credit burden, and therefore buying something else is limited solely by your financial resources: you can easily get a loan for an apartment, a cottage or a new repair in the house.
Another accompanying plus of leasing independence from loans is the ability to buy a new car, even under the condition of a non-ideal credit history or difficulties with confirming monthly income. For example, borrowers who have defaulted on loan payments often receive less favorable credit terms – and leasing is “one for all”. And another thing: if your specifics of work implies uneven payments – for example, annual or quarterly bonuses with a relatively small salary – leasing may also be an easier way to buy a new car.
YOU HAVE NO SUFFICIENT AMOUNT FOR FIRST CONTRIBUTION
For the most part, credit offers are based on the initial installment – the more this deposit and the shorter the loan period, the more profitable the offer will be. Shares with “sweet” interest and minimal overpayments are overwhelmingly relevant when paying 60-80% of the cost of a car with an initial installment and a loan term not exceeding 12 months – it is easy to calculate that even for an inexpensive car worth a million, this means 600-800 thousand down payment and monthly payment of 20-35 thousand per month. But if there is not much money on hand, and you don’t want to invest it in the repair of a used car, it is leasing that can be the way out.
Leasing programs here have several advantages at once. Firstly, leasing companies often receive discounts on new cars – that is, it costs them and the car cheaper for the buyer. And secondly, large companies, such as Major, have a large selection of leasing programs offering different down payment conditions – from large ones at 50-60% to zero. That is, in the simplest scenario, you can come to the salon, having the amount of one lease payment (20-30 thousand), and go on a new car.
YOU HAVE A VERY LITTLE OF FREE TIME
To some, this reason may seem far-fetched: they say, to register a car, go for maintenance, get insurance, pay transport tax and change the shoes are rare and dissolving in the daily routine. However, if you remember how many times you delayed with a seasonal change of tires because of unwillingness to get in the queue, how you used THAT for your salary, how you were puzzled with the choice of winter tires and the insurance company, you can look at how easy and convenient it is to make one monthly payment and nothing else to think about. Considering that the owner of the car during the leasing period is the lessor, he is the one who undertakes to register the car after purchase and its maintenance, maintenance, insurance and warranty repair. The client simply needs to refuel and drive – and many of those for whom the car is just a means of transportation tend to this model of ownership, and taxis and car sharing are expensive and uncomfortable half-measures.
YOU LOVE CHANGE
As we have already mentioned, in Russia, the model of car ownership usually implies its purchase and long-term ownership – they drive 3-5 years by the same car before the warranty period expires, and only then sell, losing 30-40% of its cost and starting this credit process first . But if you don’t see the point of “rolling out a resource” to the last, preferring fresh cars, and like to change cars often, then leasing is your decision.