How to buy your Ford Vehicle: Finance or Lease?
Purchasing a new car is something that we all look forward to, especially as it gives the chance to drive off the forecourt with a brand new set of wheels. While almost all, given the opportunity, wouldn’t turn down the opportunity to get an upgrade on their vehicle, it becomes a bigger issue when you start thinking about how you are going to pay for it. If you are in this very dilemma about buying your next Ford vehicle, here are some handy tips you may wish to consider.
To buy outright?
Before the days of the lease hire, you would walk right through the doors of a certified Ford dealer, pick your car and buy the car outright through car finance. If you are in a position to do this, it means that you will not be liable for any further payments after the total payment has been covered. However, while you will own the car, it also means that you are liable for any cosmetic and mechanical problems that may arise; after all, it is now your car.
In terms of selling the car in the near future, outright owners will be hit by the level of depreciation. In contrast, if you are looking to purchase a car and then keep it for many years, buying your car outright may prove cost-effective – particularly if you have a 0 per cent finance package.
What about the lease hire?
If you aren’t in a position to purchase a new car, but want all the benefits of a reliable and sleek new Ford vehicle, a lease hire is a fantastic choice. It’s far more flexible than buying a car outright, as after the hire period, you are free to hand the vehicle back to the car dealer should you want a new model, or simply no longer need a car. The good thing about a lease hire – particularly those available from Ford – is that it is a far more cost-effective measure than paying outright. This is because all the mechanical issues are covered during the lease hire period and should anything go wrong, all you have to do is take the car back to the garage and let the mechanics take care of it. Also, you can drive away after paying a far smaller deposit than you would if you were buying the car outright.
The rate of payment for the consumer on a lease hire is usually based on the difference between the actual price of the car and the amount it will depreciate. For instance, if your new Ford vehicle is worth £20,000 brand new and £14,000 after two years, the customer will pay £6,000 over the total contract period, plus any extra levels of interest the provider may charge.
Some aspects to consider about the car lease
Because in reality you will never officially own the car through a lease hire, you may be restricted to certain allowances through a firm lease hire agreement. At the end of your lease hire – usually two or three years, you will be given the choice to buy the car outright or hand it back to the dealership in exchange for a new Ford car.
While leasing your vehicle can be a cost-effective solution in the short term, there are things to consider to ensure it doesn’t quickly turn into a pricey option. One of these is to make sure you set a realistic monthly mileage allowance, one which you are likely to stick to and avoid surpassing during a usual month. Although setting a higher allowance may increase your monthly payments, the fact that you will be charged for every individual mile you go over means it’s worthwhile to give it great consideration. Also, check the small print of your lease contract before agreeing to the terms, ensuring that you are aware of the annual percentage rate, actual price of the car and whether aspects such as road tax and servicing are included in the overall deal.
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This content was written by Ben Edwards. Please feel free to visit my Google+ Profile to read more stories.