Money Matters: Five questions to answer before buying, leasing vehicle

Reported by: Brittany Price
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Updated: 6/25 9:52 am
As cars get pricier and pricier, more people are turning to leasing. 

"At the first part of this year, over 26 percent of the cars that are moving out are being leased," Financial Professional, Dereck Blair, said.  

Blair said finding out what's best for you involves answering five key questions. 

Number one: are you strapped for cash? 

"Usually to lease a car it's going to cost you $1,000 to $2,000 to get into that car. That's an upfront cost, security deposit," Blair said. 

Upfront costs differ if you purchase a vehicle.

"It's going to cost you $9,000 to $10,000 because you have to put the 10 percent down, plus the taxes, so it's going to cost you a lot more up front buying a car," Blair said.  

Number two: how good is your credit? 

"It's very hard to lease a car with bad credit, whereas buying a car pretty much any car lot in town is going to give you a good deal because they're going to be able to finance it themselves," Blair said.  

Just look out for those higher interest rates. 

Number three: do you like driving new wheels?

"If you want to have a new car every two or three years and you're always buying the new car, leasing is a great way to go. a new car, if you're going to have it five to seven years, you definitely need to purchase the car," Blair said.  

Number four: do you rack up miles on your cars?

"If you're going to drive right around 15,000 miles then you're a perfect lease client. if you drive less than 15,000 miles then you're paying for depreciation on a car that you're not getting use out of. if you drive more than 15,000 miles then you're going to have an added cost at the end because you put too many miles on that vehicle," Blair said.  

Number five: do you keep your car in mint condition? 

"Let's say on a lease you take care of your car. You're going to get the security deposit back. Whereas if you buy a car and keep it in mint condition, when you go to sell it you're going to get a better rate on it," Blair said.  

Blair said whichever you decide, don't forget to negotiate price. 

"You can definitely haggle for leasing also. You want to treat that just buying a car. What they say on the commercial or print isn't the bottom line. You definitely want to haggle on both purchasing and leasing a car," Blair said. 
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