Buy vs Lease At Shaganappi GM

When it comes to making the decision to buy or lease a vehicle the options can be confusing. To help you make an informed decision, we have provided the following information to bring clarity of what each option means for you.  


In the most basic sense, when you buy a new or used vehicle you pay for the entire cost of the vehicle. When you lease a new or used vehicle, you pay for only a portion of the vehicle's cost, which is the part you use during the time you are driving it.  


Here is a more detailed breakdown:




Whether you pay for the car upfront, or finance it and make monthly payments, you own itFinancing the vehicle means you will have to meet the obligations the lender requires, which include and are not limited to a down payment and timely monthly payments. If you do not make said payments, the lender has the right to repossess your vehicle. 



If you choose to and are approved for financing, the bank will request a down payment. The amount of the down payment is based on the lender's requirements and your credit score. You can also trade-in another vehicle and use any of this equity towards your down payment on your new vehicle. 



In the future, you will be able to resell your vehicle at market value, which is dependent on a variety of factors. Protecting your investment by following the service maintenance schedule will aid in maintaining your vehicle to achieve a higher resell value. 



Once you have paid off what you owe your financial institutionyour payments will be terminated, and the vehicle would not be able to be repossessed. Your vehicle is 100% yours. The lending institution will send you a Lien Release as proof that the vehicle is completely paid off and solely in your name. 






You do not own a vehicle when you lease it. You are paying for the use of the vehicle, but the financial institution that you leased it through owns it. For this reason, you generally pay less per month in a lease than if you were to buy a vehicle. 



Leases generally do not require any type of a down payment. Upon delivery, you will be required to pay the first month's payment, a security deposit, the acquisition fee and any other fees and taxes. It is optional to pay more up-front, as a form of down payment, to lower your monthly payments.  



At the maturation (end) of your lease, there are several options: 

  1. 1. You can extend your contract and continue payments until you own the vehicle outright.   

  1. 2. If you do not exceed mileage limits*, and fit within the wear and tear guidelines, you simply return it back to the leasing company who own the vehicle.  

  1. 3. You can negotiate to purchase the vehicle at a buyout price based on the initial value of the vehicle and payments made.  

Depending on the route chosen, the vehicle could be yours, and you would have the same rights to sell as the buy option. Once bought, the leasing company would release the Lien on the vehicle, and it would be registered solely in your name.  


*If exceeded, costs can be incurred and charged. 




Throughout the course of your lease, you will be able to negotiate new terms that fit to your needs, such as an early buyout, or extending your contract and lowering your monthly payments.  




At Shaganappi GM, we listen to each of our customers' situations and work with you to find the option that best suits your needs. Do not hesitate to ask one of our Sales Associates who would be more than willing to help you during this important decision-making time.