Is It Better To Own Or Lease A Car?
Having title to a car means you have an asset, an addition to your net worth once all financing is paid. Having a lease means having a debt that must be considered when a lender looks at your financial ability.
Lenders must also consider what is likely to happen when the lease is up. The borrower will either buy the car (which means a lump sum payment or a new loan), buy another car (again, think of a new loan and payments), or enter into another lease (still more monthly payments) — three situations which mean additional costs to the borrower.
Alternatively, if you expect to give up the car when the lease ends, be certain to tell the lender and explain why. For instance, at your new location, only one car will be needed in the household, you will be able to commute by public transportation, etc.
Lastly, many loan programs allow lenders to ignore monthly auto payments if only 6 to ten payments remain. The thinking is that the payments will be made, and the vehicle will be retained for some time. This consideration applies only to auto loans for a car being purchased and not a lease.
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