So you’ve been surfing the internet and have come across the idea of owning used luxury cars.
You like the fact that you can save a few extra bucks on this purchase. And thanks to the overflowing knowledge on the internet, now you’re lost and wondering if you should buy or lease one?
Worry not! Because as always, we are here to lead you to the right path.
We know that saving money sounds like a rational thing, but the question is- to what extent should you prioritize savings?
Making a rational decision is tricky, and trust us on this money isn’t the only factor that makes a decision rational.
Buying pre-owned luxury cars comes with some benefits, and so does leasing used luxury cars. So the question is not of benefits, it’s about what suits you and fulfills your requirements in the long term.
Let’s discuss what the whole fuss is about first.
Difference between leasing and buying Pre-Owned Luxury cars
When it comes to buying the idea is quite clear-you pay, and the title is transferred to you. You can also finance the car and transfer the title by paying off the debt with time.
But when you lease a car, your rights are temporary. This means the car is yours only for a prescribed period and not any longer than that.
Another thing when you lease a car is that you are only allowed to drive a few pre-decided kilometers, and anything beyond that will cost you additional money.
Similar to buying, while leasing, you can end up paying a few hidden costs like additional distance charges, wear and tear penalties, mechanical repairs, etc.
But unlike owning a car, when you lease used luxury cars you are spending this money for maintenance for nothing.
Think about it, this car that you’ve leased will have to be returned one day and all the money that you spend on this will be good for nothing.
Whereas if you own a car and then pay for maintenance, at least you know you are spending for your long-term satisfaction.
Leased cars are non-customizable, which means if you like your car to have a particular amenity, you’ll have to compromise and drive it as it is. Whereas when you buy used luxury cars, you can do whatever your heart desires.
Now that we know some major differences between these two, let’s dive in and decide whether you should buy or lease a luxury car considering the below-mentioned parameters.
- How long do you wish to keep this car?
Ask this question to yourself, and figure if your long-term goals align with the decisions you are taking at the moment.
If you wish to keep this car for a year or two, then this might still seem like a feasible option. But if you desire to lease for a longer period of time, this probably doesn’t make sense.
After all, why would you lease a car for 4-5 years and give it back after incurring all the maintenance and upkeep costs, unless you are willing to shift car-to-car and fulfill your luxury zeal.
- Do you wish to own a car in the next few years or just keep leasing because you’re in a different city?
If your ultimate dream is to own a luxury car, then you probably should buy one instead of leasing. You could be in need of a car because you’re in a different city and not willing to buy one because of uncertain plans. In this scenario, it still makes sense for you to lease a car for a year, so that you can go on a few drives and roll accordingly.
- Do you want to own this luxury variant to be able to show it off at those family functions or your purpose is to meet daily requirements?
The fact is a leased luxury car would come with mileage restrictions. So if you consider the purpose of this purchase, it will help you avoid unnecessary hidden costs. As dealerships that lease or CPO outlets usually charge high for extended mileage. Thus, if you’re paying monthly EMIs, service charges, insurance, and warranty fees, regular wear and tear costs, and even then you are charged per exceeding kilometer- it’s not really worth it, is it?
Low EMIs or Owner’s Title
- Are you leasing this car just to get low EMIs?
One big reason that people choose to lease is because of the low EMI. And this isn’t the right reason to lease used luxury cars, because even if you are getting low EMI one major thing that is being compromised in this scenario is the title. You’ll end up paying for everything and will be left with nothing- so choose wisely!
If your priority is to own a luxury car, then own one and don’t go the other way around. If you want to know the secret to getting low-interest rates and EMIs while financing pre-owned luxury cars, read on!
- Have you considered the estimated costs you will have to pay in case an unfortunate event takes place?
CPO outlets don’t just let you drive away with their most expensive cars without having a backup. In case you damage the car, the costs are on you, and yes this is similar to owning one. But meeting into an accident and getting your car repaired is one thing and being under a legal liability to pay someone is another.
In case of any arrears, the outlet has all the rights to sue you. Whereas when it’s your own car, you can get it repaired whenever you want.
- Have you thought about what would happen after the lease period ends?
You will, in your consciousness, go to the outlet to return the car you’ve spent so much money on. And what after that? You will have to either buy or lease another car-which will continue the endless cycle of EMIs. When you buy used luxury cars instead of leasing, you are probably eyeing the one day the title shifts to you entirely. But this vicious cycle of endless EMIs is no good!
- Leasing a car means giving a commitment. If you ever wish to terminate the lease, you will have to pay additional penalties. Are you up for that?
CPO outlets or leasing agencies usually charge high costs for terminating the lease agreement in the middle. This is just a long list of bills with temporary joy. Consider researching before you make up your mind to lease, as decisions that involve you spending such a huge amount of money should be taken with care.
Now about that secret tip, we talked about earlier. If you wish to finance your dream car at low-interest rates and EMIs, consider putting in a good upfront down payment. Paying at least 20% as a downpayment will help you to decrease the overall loan amount which will further reduce the interest rates and monthly EMIs. Another thing to consider is to pay for additional perks and accessories in cash. The same logic applies here, adding the number of warranties to the entire loan amount will only increase the amount you owe. So keep a good budget to pay in cash as well.
That’s all you need to know and consider before making this decision. The final call is yours, but make sure you do in-depth research about the outlet and agency before committing to the lease. Or if we‘ve convinced you to buy instead of leasing, let us take another burden off your shoulders.
Check out Kings Auto’s collection of quality assured pre-owned luxury cars and get your hands on your dream car today!