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Finance vs. Lease
The decision to lease or finance your vehicle can be as much a matter of personal preference as it is what you can afford. To help with that decision, let's start by taking a deeper look at exactly what leasing and financing mean, some of the facts about each, and the potential cost differences.
Leasing your Scion
When it comes to ownership, leasing is a bit like renting a Scion. Leasing a vehicle offers a number of benefits. It also has a few limitations. Before deciding if leasing is right for you, here are a few things you should consider.
Benefits of Leasing
- Increased affordability: With a lease, you only pay for the portion of the vehicle that you actually use. As a result, leasing typically results in lower upfront costs and lower monthly payments than you would pay to finance the same vehicle.
- Lower taxes: With a lease you only pay tax on the portion of the vehicle that you use whereas with financing you pay taxes on the full purchase price.
- More car: Lower monthly payments can enable you to get 'more car' for your money. Many people find they can lease a new vehicle for less than the finance payment on a used vehicle.
- Excellent coverage: If you lease for a term that coincides with the length of the manufacturer's warranty, warranted repairs will often be covered.
- Gap Protection: If your vehicle is damaged beyond repair, Scion will cover the difference, after you have paid the deductible, between what you owe on the lease and the amount of your insurance settlement.
- Kilometres: 24,000 kilometres per year are included in your lease, and you can buy additional kilometres up-front at a reduced rate if you require them.
- Lease-end options: At the end of your lease, you have two options.
- Purchase the vehicle at the Lease End Value indicated in your contract.
- Return the vehicle as specified in the lease and lease or finance another Scion vehicle.
- Walk-away: If you return your vehicle at the end of the term, the responsibility of selling a used vehicle is eliminated.
Limitations of Leasing
- Excess kilometre and wear and tear charges may apply.
- You do not own the vehicle and as a result do not build equity.
- Lower monthly lease payments may result in higher carrying interest charges than a financing loan.
- Certain modifications to the vehicle are not permitted to a lease vehicle (consult your lease agreement or dealer for additional details).
Financing Your Scion
When financing a Scion, you are buying that vehicle and spreading the payments out over time. As with Leasing, there are benefits and limitations. Before deciding if financing is right for you, there are a few things you should consider.
Benefits of Financing
- Build equity: Financing gives you the opportunity to own your vehicle while you are building equity.
- Customize: Financing gives you the right to make modifications and customize your Scion as much as you like.
- Scion exclusive: Scion customers have the ability to make full or partial early repayments at any time without penalty.
- Kilometres: If you plan to drive significantly more than 24,000 kms per year, financing might provide a better option than paying excess km fees with leasing.
- It's yours: Once you have paid what you owe on your finance contract - the vehicle is yours!
Limitations of Financing
- Financing generally means higher monthly payments.
- When you finance a vehicle you will own it in full after you have finished paying your contractual obligations. With ownership comes the depreciation of the vehicle which could affect how much the vehicle is worth at the end of the contract.
- As you are likely to keep a financed vehicle for longer than a leased vehicle, there could be increased maintenance costs as the vehicle ages.
How Can We Help?
We can help you refinance your lease/purchase or adjust the term of the contract. Erin Park Scion's financial team is committed to finding you the perfect financing options to suit your needs.