To lease or buy — that is the question. Which one is right for you? Here are five questions you need to ask yourself before getting your next vehicle.

Do you love the new car smell?

If you are the type of person who wants a car with only a few miles on it, all the latest features, and the smell of a new car to permeate the air, then leasing might be the best option for you.

Leasing allows you to “buy” a brand new car every few years with no penalty. You won’t have to worry about being upside-down — owing more on your car than you can sell it for — or stuck in a car you don’t like anymore.

You can trade the car into the dealership when your lease term is up and either lease another car, buy a different car with no negative equity, buy the same exact car that you leased, or simply turn in the keys and walk away.

“Leasing offers a lot of flexibility,” says Jeff Davis, Operations Manager of Volkswagen SouthTowne. “It is perfect for people who want a brand new car with all the latest tech but don’t want the commitment of driving it forever.”

Do you want to modify your ride?

For other drivers who want to invest their time, passion, and love into their car, buying is a better option. “We have a lot of VW enthusiast customers who pay cash for a car, or finance their vehicle because they know they are getting a car they are going to love," says Davis.

Buying a car is perfect for the driver who wants to add after-market upgrades on their vehicle like ski and bike racks, window tints, custom wraps, wheels, or altering the grille or changing bumpers.

What stage of your life are you in?

Are you a college student who wants a reliable car but no commitment? Are you a busy parent who needs a certain number of seats for carpool but doesn’t want to drive that car forever? Are you elderly and want a car with no debt? Are you a working professional that wants a new flashy car with the latest tech every few years?

Leasing can be a perfect option for people in these stages of life. All the oil changes, tire rotations and service checkups are covered when you lease, taking car maintenance out of the budget.

“We enjoy matching up our customers with cars and payment options that work for their situation,” says Josh Osborne, General Manager of Volkswagen SouthTowne. “Someone might lease a Beetle, for example, in their 50s because they’re celebrating not having to drive for carpool anymore. Or a grad student who wants a Jetta while they’re in school but then will upgrade to something larger down the road. The Arteon is our latest luxury car and a great option for working professionals who want a gorgeous car at a reasonable payment.”

Leasing is a great option for people who can see clearly what they want for the next few years without having to commit any longer than that.

What is your commute like?

One of most compelling reasons to purchase rather than lease is the number of miles. Do you plan on taking multiple road trips a year? Do you have a long commute every day to work? Leasing does have mileage restrictions (normally 10,000 miles per year), so for heavy-use drivers, purchasing makes more sense. However, it should be noted that more miles mean lower trade-in-values for purchased cars as well.

“One of the great things about our purchase programs at Volkswagen SouthTowne,” says Davis, “is that we have a 6 year, 72,000 mile bumper-to-bumper, transferable warranty on our new VWs so even if you purchase rather than lease, you’re able to have the same driver peace-of-mind."

Purchasing can be very attractive to drivers who qualify for low APRs per year. For example, a 1.9% interest rate for 60 months might be attractive for some people because the interest remains very low on their vehicle.

How much can you afford a month?

This is really the biggest differentiator between buying and leasing. Buying is going to be a higher monthly payment than leasing. Leases can be secured for a lower down payment — usually $1,999 down, but sometimes even $0 during certain times of the year, making it a much more attractive to the budget-conscious consumer.

Payments on a lease range anywhere from 30-60% less than finance payments (this usually translates to about $100-$150 less each month).

“Another benefit to leasing is that the sales tax amount paid is lower and interest rate is usually lower, plus it comes with free GAP insurance,” says Bryan Armstrong, e-Commerce Director for Volkswagen SouthTowne.

“On a lease, you only pay for the amount of time you use the vehicle, and you only pay sales tax on each payment. On a purchase, you pay all the interest and sales tax in the first couple years. Typically, the first three years of payments go mostly to interest to the bank, and you have the entire amount of sales tax in the loan, which is why people get upside down or have negative equity on their vehicle so quickly.”

Purchase payments, on the other hand, will be higher and usually require about 20% down, plus the full sales tax amount. It's also important to remember that once you pay off the car, it is yours! Plus, manufacturers often offer bigger discounts on a purchase than on a lease.

Whichever offer you choose, we have fantastic offers and programs at Volkswagen SouthTowne to support you! Check out our inventory at vwsouthtowne.com

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