The Quick Answer
Leasing gives you a new car every few years at a lower monthly payment but with no ownership at the end. Buying costs more month-to-month but builds equity and lets you keep the car for as long as you want. The right answer depends on miles, taxes, and goals.
📊 Side-by-Side Comparison
| Feature | Lease | Buy |
|---|---|---|
| Monthly payment | Lower | Higher |
| Down payment | Low or none | Higher (or financed) |
| Mileage limit | 10,000-15,000/yr | Unlimited |
| Wear-and-tear charges | Yes (at turn-in) | No |
| End-of-term equity | None | Resale value |
| Best for | Latest tech, low miles | Long-term, high miles |
When To Choose Each
✅ Choose Lease If…
- You want a new car every 2-3 years
- You drive under 15,000 miles per year
- You like predictable monthly costs
- You can deduct lease as a business expense
✅ Choose Buy If…
- You drive more than 15,000 miles per year
- You plan to keep the car 5+ years
- You want to build equity and avoid endless payments
- You modify your cars or have pets
🏆 Our Verdict
Lease vs Buy
Buy if you drive a lot, modify, or keep cars for years. Lease if you value being in a new vehicle and drive average miles. The lowest cost of ownership long-term is to buy and keep a car for 7-10 years.
❓ Frequently Asked Questions
Can I buy my leased car at the end?
Yes. The residual value is set in the contract; you can buy at that price or finance it.
What is the "money factor" on a lease?
It is the interest rate expressed as a decimal. Multiply by 2,400 to get the APR.
Will going over the mileage limit cost a lot?
Yes, typically 15-25 cents per mile. 5,000 miles over costs $750-$1,250.
Are leases ever better financially?
For short-term, high-residual cars with manufacturer subsidies, leasing can beat buying. Run the numbers.
Should I put money down on a lease?
Generally no. Putting cash down on a lease is risky if the car is totaled - you lose that money.
Can I trade in a car for a lease?
Yes. The equity becomes your cap reduction.