Car Loan or Car Lease – Which One For Me?
In this day and age of fast paced life all of us are in desperate needs of means of transportation. It is difficult to hope to survive without it. It is but obvious that not all of us ca pay the entire cash to pick up a car because it does cost a lot of money. There are options however that will help ease the burden off people’s shoulders. Let us talk in detail about these details that are available.
The first option that a person can opt for is a Car loan. Car finance requires certain requirements which have to be fulfilled. The requirements that are necessary to be eligible for a car loan are as follows
i. You will need an income proof showing that you earn a steady income. This will also help because the banks require verifying with your employer that you really work for them.
ii. A bad credit is quite a disadvantage in this field. A person may be declined or may be asked to buy a very low budget new car or a used car.
iii. The insurance needs to be purchased before the loan. The applicant is also eligible if he already has existing insurance.
iv. Down payment has to be ready. In most cases the down payment is supposed to be about 10 percent of the actual amount
v. You may have to provide proof that you have been living at the current address for at least 24 months.
The second option that one has is a car lease. Now car leasing is an option where you can lease a car for a period of time. The minimum amount of time that is allowed is about 12 months. Given below are the requirements
i. Insurance is a must in this case as well.
ii. A bad credit rating may discourage a dealer from giving you a car but in some cases you can still get though with a reasonable car.
iii. Knowledge of how long you want the car for
iv. Enough savings to be able to pay the depreciation of the car every month plus the charge for its use.
v. Negotiating skills are very important to be able to get a good deal.
vi. Proper knowledge of all the documents you may be signing.
Car leasing to many seems the same as car renting. It is the same in a way but different in a lot of ways. In this case you are not leasing the car from the dealer who strikes the deal with you but in fact leasing the car from the car company itself. The user ends up paying the rest for using the car as well as the value of the car that has depreciated while with him.
Both the options are a nice way to be able to get your hands on new cars. The first option is for those who have a more stable lifestyle and can afford the high monthly installments and the second is for those who are just about pay only for the time the car is used.
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