Essentially, Leasing is just an alternative way to finance a new vehicle. We know that when purchasing a new vehicle the down payment, sales tax and license fees are required to be paid up front. However when leasing a new vehicle you are required to pay only the first monthly payment, a security deposit (usually same as monthly payment), and the license fees. The sales tax (which is based on the capitalized value of the vehicle) is actually amortized over the term of the lease in most states. In other words, the taxes are included in the monthly payments.
There are many people in the world who own a business but still cannot afford the new equipment due to less capital or some problems. The leasing of the equipment provides them with a source to start their business and gain profits from it. The leasing of the equipments has become very popular amongst the people and as they are provided very easily the people opt for the leasing. The people do not have to wait for the financing companies to give them a call and provide them with the finance so that they can buy the equipments. The leasing of the equipments help in many other ways like there is no maintenance cost of the leased articles which is a great relief to the owners of the business.
Some people choose to own a car and some people choose to lease. It all depends on the person and their individual needs. Contrary to popular belief, leasing is not “renting” a car. Both auto buying loans and auto lease loans are two different methods of auto financing. Leasing a vehicle just means you are financing the use of it and when you get an auto loan, you are financing the purchase of the vehicle. When deciding on whether to buy or lease, you will want to consider all of your options. Both leasing and owning come with benefits and drawbacks. Ultimately, it comes down to what you feel is best for you.