With so many car finance options available these days, it’s hard to know what’s what. And while many remain confused on this subject, we’ve got you covered with this blog. This blog looks into the differences between a car loan and car leasing to help you make the right decision.
What Is Car Leasing?
So, let’s talk basics. A car lease allows you to drive the car of your choice for a certain amount of time. A leasing company, which has full ownership of the vehicle, provides the vehicle in return for monthly payments. The monthly rent is an agreed-upon amount between the individual and the leasing company. With a car lease, the individual does not need to pay recurring costs on the vehicle such as maintenance expenses or road tax. When leasing a car, the individual is sometimes required to purchase a car insurance policy, while in other cases, the insurance is covered in the monthly rental fee. When the leasing period comes to an end, the car needs to be returned to the leasing company. In the case that the individual wishes to purchase the car at the end of the leasing period, they can arrange this by paying a specified amount given by the leasing company.
Who Can Take Out A Car Lease?
This is purely dependent on the individual’s age and income. Some individuals will not be deemed eligible if their income is not of a particular amount.
What Is the Easiest Option?
If you’re looking for the most straightforward option, leasing is much easier. Leasing is also the easiest when it comes to maintenance as the leasing company takes care of it for you. When it comes to applying, car loan applications are more tedious, but with online applications these days, the process has become a lot faster and quicker.
What Is A Car Loan?
A car loan is a financial product which is repaid, with interest, through regular instalments and can allow you to purchase the car of your dreams. Under a car loan, the vehicle acts as a guarantee. If an individual fails to pay the car loan accordingly, the lender takes the vehicle back as well as the ownership. An individual’s eligibility for a car loan, like a car lease, is dependent on credit score, age and income. Once the loan period is complete, the individual will have complete ownership of the car.
If you still find yourself confused, contact us at ZEP Finance for more advice on car loans and leases. If you’re interested in a car loan in the Gold Coast, get in touch with ZEP Finance today. We can tailor a solution to suit your needs.