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What is better, leasing or getting a loan for a car?
Should I get a loan or lease my next car? I just got a new job and can't wait to get a shiny new car to go with it. I am more financially secure than ever, and I am thinking about getting something on the higher-end.
Shannon Martin · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
A shiny new car is a great reward for getting a new job! Deciding between a loan or a lease is entirely up to you and how you envision your car ownership. There are pros and cons to both options.
Leasing pros:
- Lower monthly payments
- Easier access to luxury vehicles
- Frequent upgrades mean you can always be driving the latest models
- A good warranty and free maintenance are usually part of the leasing contract
Leasing cons:
- If the annual mileage limit is exceeded, there can be high penalties
- Since you don’t own the vehicle at the end of the contract, you will always be making car payments
- Vehicle modifications are forbidden
- You have to carry the liability insurance limits mandated by your leasing contract
Loan pros:
- It’s your car—make any modifications that you like
- Once the loan is paid off, you will have no monthly payments until you need a new car or car loan
- If you need or want to sell the car, you can at any time
- You can have your choice ofliability limits
Loan cons:
- Higher monthly payments
Since you are shopping for a new car, keep the cost of the insurance in mind. By downloading the
Jerry
app, you can quote both leasing and loan options with the appropriate coverages. Jerry shops insurance policies with over 50 companies and then delivers the options right to your phone. Hopefully, this helps make the decision a little easier for you. Congratulations on the new job!
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- Gregory R.
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Jerry partners with more than 50 insurance companies, but our content is independently researched, written, and fact-checked by our team of editors and agents. We aren’t paid for reviews or other content.
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