Switch Buying To Leasing

Leasing versus buying a car can be a touchy subject.  Like asking someone to switch political parties touchy!

I used to buy my cars.  No way would I ever lease!  That was crazy.

Because why would I want to pay for a car that’s not mine?  I mean, you don’t own a leased car.  The bank does.

But, about  10-years ago I finally tried leasing.  And I don’t ever see myself going back.

Leasing versus buying a car can be a touchy subject.  Like asking someone to switch political parties touchy! 

So, I was a passionate buyer.  But I switched from buying to leasing.  And now, I’m a passionate lessor.

For me, the initial switch was a big deal.  Very.  But since then I’ve loved it.  And, for the most part, it’s been easy.

It’s a big decision.  And one only you can make.  Because you have to be happy with it.

So first, I’ll share the pros and cons of both buying and leasing.

Here’s why you might want to buy instead of leasing your next vehicle.

Pros Of Buying

  1. Ownership.  You own the car: Once you get done paying for it, it’s yours.
  2. Miles. You are free to put as many miles on the car as you like.
  3. Customize. You can customize the car without consequence or concern.
  4. Possible liquidity.  You can refinance the car loan as often as you like.
  5. Once you have equity in it, it’s an asset.
  6. Lease disposition fees are non-factors.
  7. End of lease inspections are non-factors.

And here are the cons of buying instead of leasing a car.

Cons Of Buying

  1. You own the car.  So have your credit card handy as your car goes in for service.  (Leased cars are usually under warranty.)
  2. If you go over your contracted miles it might cost you too.
  3. Sure you can customize the car.  But down the line you’ll want to get rid of it.  And finding a buyer for a customized car can be a headache.
  4. And sure you can refinance a car.  But loans cost money themselves.
  5. Likewise, the car you buy is an asset.  But it’s a depreciating asset.
  6. Accident damage on a car you own is now your damaged vehicle.  (Yes, it gets fixed.  But it’s often never the same.)
  7. And that accident damage can lessen the value of the car you own.

But it’s simple.  Three things.  Safety. Cost. Warranty.

As you can see many of these issues intersect.  Here are the pros of leasing versus buying.

Pros of Leasing

  1. Pay less to drive the same car.  Because with leasing you’re only paying for part of the car.
  2. Get a new car about every 3-years.
  3. Your car is almost always under warranty.
  4. The latest safety equipment and technology will be in your new car.
  5. Automakers almost always sweeten their offers to keep you buying their brand.
  6. If your car is in an accident.  It’s a lease and goes back by ‘x’ date anyway.
  7. Plus use a factory approved body shop and you’ll have no issues upon lease return.
  8. And Gap Insurance comes with a new car lease in California.

There are downsides to leasing.  But in my estimation, very few.  And when you address them they’re rather insignificant.

Cons of Leasing

  1. Limited mileage. This is always the horror story issue.  You don’t have to be exact. But you do have to be realistic with your mileage when leasing.
  2. End of lease inspection.  I ‘get’ these but they bug me.  Because a third-party, paid for by the factory, gets to judge my car.  Or the dealer gets to.  Either way, it seems the ‘fix’ could be in.
  3. End of lease disposition fee.  These bug me too.  Because it’s pretty much a hogwash fee.  Dealers don’t charge it.  Factories do.  But if you lease another of its vehicles during the transaction that fee gets waived.
  4. Automakers try to penalize you for not sticking with their brand for your next lease.
  5. You’re buying a new car every few years.  Yes, it can be fun.  But also a hassle.
  6. You always have a payment.

Switching Buying To Leasing Was A Relief

For me, leasing provided immediate relief.  Because as any car guy or gal will tell you.  The tendency is to obsess a little about your ride. :0)

So, the relief was a little less hypersensitivity about… well, everything.

I didn’t care so much about hitting potholes.  And when I scraped a rim on the curb while parking it wasn’t such a big deal.

Also, I didn’t care so much where I parked when out and about.   Because if my leased car gets dinged – oh well.

My Key Reasons For Switching Buying To Leasing

If you’re like me then you’ll then you’re going to overthink this decision.  Big-time.  And you’re welcome to crunch lease numbers until you’re numb.

But it’s simple.  Three things.  Safety. Cost. Warranty.

Before I was a Dad, I liked leasing.  Now that I have a little dude, I love leasing.


My son is my life – my wife’s too, of course.  And I want the latest greatest safety equipment and technology wrapped around us on the road.


I look at leasing as cheaper than buying.  Why?  Because cars plummet in value.  They are not an investment.  So I want to put minimal resources into that depreciating asset.


Leasing means I’m always under warranty coverage.  And that’s factory warranty coverage.  Which I far prefer rather than extended warranty coverage that isn’t factory-backed.  (Gotta be careful with some 3rd party warranty companies.)

New Ride!

Of course, I like getting a new car.  Even though car buying can definitely be stressful.

What’s the Biggest Potential Problem With Leasing A Car?

Mileage.  Hands-down the biggest issue is mileage.  But it’s super-simple to address. You need only to be realistic when buying/contracting the lease terms.

Under-Buy Or Over-Buy Lease Miles?

I’m still mastering this one.  To date, I’ve overbought my lease miles.

Yeah, it’s annoying trading in my leased car and being 6,000 miles under what I contracted.

And no, there’s zero benefits to the buyer for returning the car with miles to spare.  It’s a factory call, not the dealer’s to make.  And they give no credit for returing your car with unused miles.

Under-Buy Lease Miles – But Only By A Little

So, my advice, if you can’t nail-down your lease miles is this.  Under-buy.  Because when you pencil out the cost you’re money ahead.  Paying only for what you use.

And after all, that’s the entire concept of leasing in the first place – right?

Questions or thoughts on this topic or others?  Email me: tom [at] idrivesocal [dot] com.


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