Millions of people in the US desperately need a car but can’t afford to buy one right now. In such cases, they have a few options. The first one, or perhaps the best one, is to apply for a free or cheap car under various programs available for low-income households, seniors, veterans and single moms.
However, everyone that wants to own a car doesn’t come under these categories. Therefore, the second option is to hire a car on a daily, weekly or monthly basis. This works out to be very expensive.
The third option is to enter into a long-term lease for a car. Such leases are available for periods ranging between three years and five years. They’re not cheap in any way, but a lease helps solve the immediate problem of needing a car right now.
While leasing a car seems a superb option, it comes loaded with several disadvantages. I’m not saying that leasing a car is bad in any way. For some, a car lease works well, but for others, it could prove to be a waste of money.
Why do I say that? If you’re planning to lease a car or have one already, continue reading. In this article, I will speak of 10 reasons not to lease a car, if you can help it.
10 Reasons Not to Lease a Car
Before proceeding further, I will repeat that leasing a car is a fairly good idea if you can find superb deals. Having said that, there are at least ten flipsides to leasing a car that you might not know. Hence, in this article, I will discuss these top 10 flipsides of leasing a car.
1. Long Commitment to the Lease
The first and possibly the greatest flipside of leasing a car is the long-term commitment. Usually, a lease contract or agreement spans for two to three years or even longer. This means you have to complete the lease term or pay some extra money to get out of the agreement.
2. Leasing Doesn’t Give Ownership
Secondly, the money you pay for leasing the car is gone for good, regardless of how much you use the vehicle. The money doesn’t go towards paying for the car ownership.
Instead, you’re merely paying rent to use the car. Instead, the same money could be used to repay car finance if you bought a vehicle on loan.
Also Read: 10 Steps To Buy A New Car
3. High Break Fees
As I mentioned earlier, you can’t simply go to the dealership and escape from a car lease. Instead, you will most likely end up paying a stiff break fee to end the contract before the two or three-year term. This money is practically wasted since you don’t really gain anything through the break fees.
4. Restrictions on Sale
Regardless of what happens, there’s no way that you could sell a leased car and buy another one. A leased car is a leased car since it’s someone else’s legal property.
Even if the car develops several issues, you’re still stuck with the vehicle, though there could be an exchange option with the leasing company.
- 7 Ways to Sell Your Junk Cars for Cash Near You
- 17 Best Places to Sell Your Car for Cash
- Who Buys Junk Cars without Title Near Me?
- 15 Ways to Get a Free or Donated Car
5. No Customization
Most of us love to customize our cars according to our taste and personality. Sometimes, the spouse or kids want us to customize the car according to their wishes.
All this is impossible when you lease a car. The lease contract doesn’t allow you to do any customization of the vehicle, except maybe placing something that’s easily removable, on the dashboard.
6. Registration Expenses
The person who leases the car pays for its registration. This is yet another unwanted expense that you would be bearing for leasing a car.
Of course, vehicle registrations aren’t very expensive in the US, but fees vary in different states. Obviously, you can’t drive a car without proper registration and hence, you’ll be bearing the costs.
7. No Free Roadside Assistance
Roadside assistance isn’t always free. But with a leased car, you could end up paying a lot more money for roadside assistance, in case of the unfortunate eventuality the vehicle breaks down somewhere on the road.
People who own personal cars can get some roadside assistance from companies if you have a contract or agreement. With leased cars, you can’t get such agreements and have to pay cash upfront for every service.
8. No Concessions for Serious Damage
If you get into an accident or even something like a tornado damages the car beyond repair, the lease agreement will remain the same. This means you wouldn’t be able to get any concessions, waivers, discounts, or stuff like that, even though the car can’t be used anymore.
Totalling of a car can occur even if you’re a safe driver but land in a serious accident, which isn’t your fault either. This is one of the bigger flipsides of leasing a car.
9. Maintenance Costs
You’re responsible for maintaining the vehicle, regardless of the condition of the leased car. The maintenance expenses can vary depending on the make of the car and its age. Most Americans maintain the car themselves and reduce their dependence on garages and workshops.
While DIY car maintenance is fair enough, it doesn’t often work in the case of older vehicles or expensive ones. Also, you will still pay for spares, oils and filters even if it’s an old car.
- Car Wash with Free Vacuum Near Me
- Make Money Flipping Cars – Step-by-Step Guide
- 10 Guaranteed Ways to Make Money with Your Car
10. No Side Gigs
There are several side gigs available where you can earn money by driving. These include side gigs such as driving for Lyft and Uber or delivering for Amazon, United States Postal Service, Postmates and other such services.
While in some cases, such companies allow you to use a leased car, others don’t. Instead, they want delivery crew or drivers to use their own car- meaning the one you bought and is registered fully on your name. That’s because of the legal status of leased cars and personal cars.
Overall, these are some of the minor and major flipsides of leasing a car. If it’s unavoidable to lease a car, look for better deals. That could help save money and effort, too.
As you can judge from my above article, there are a few flipsides to leasing a car in the long term. Lease a car according to your financial condition and needs. Also explore options of buying a preowned car and compare the pros and cons of each.
Samuel Mitchell is a financial analyst with expertise in investment research and risk assessment. With a background in finance and advanced certifications, he delivers accurate and concise financial analysis. Samuel's writing style is precise and data-driven, providing actionable insights for readers. Explore the world of finance with him and make informed investment decisions.