Why Lease a Car?
With the competition rising between the companies, a scheme called car leasing has become a boon. Corporate sector has adopted the method of financing a car and then paying the EMIs through the monthly earning from the corporate lease.
Leasing has become a winning alternative to purchasing a car under attractive offers like zero percent and low-rate financing. Lease a Car is a flexible solution whereby the car is leased for a chosen time, insurance, maintenance and registration in the monthly rental.
This option has become a business that has taken a hike in corporate. People have indulged in the idea of giving the car on rent to gain a certain profit.
Benefits to Lease a Car
For a Company
1) By approaching the option of car leasing, the corporate does not have to make the primary investment in the possession of the car.
2) Maintenance expenses are moderately cheap since most guarantees for brand-new cars reach up to 3 years, which is a standard average lease period. Moreover, employment of the driver can be catered by the owner.
3) Costs of managing the car like servicing, filing, insurance and so on can all be bundled and made a part of the monthly rental.
4) Since the lease of the car is for a specific term only with methods of revival, there is no trouble of reduction in the asset of the company.
5) This is an easy business because of the financing offered for the car by many lenders giving certain benefits.
6) The added advantage of this option is the incentives and perks that are given to the employees without popping out of the budget.
7) At the completion of the payment period of the car loan, the car would have spent for itself and will be independent of cost for the owner who is then at privilege to use it further to create income or dispose it off by trading and make some instant money.
8) Lenders find it more convenient to provide car loans to customers that have a car lease choice as the repayment. It is assured in such cases as the car now becomes an earning asset.
For an individual
1) Car leasing is a great option for car-lovers who have the passion for driving new cars. The leasing decision, as explained above, is an excellent means to fulfill this passion.
2) For self-employed individuals or businessmen the complete lease rental paid, is acceptable for deduction under the tax provisions. So an individual can show this rental for tax deduction.
3) More importantly, the auto itself being a depreciating asset, the resale worth will always be lower than the investment amount, thereby, making the lease option more lucrative.
4) Amount at which a car is leased is fixed and lower than EMIs paid for loan servicing. These savings by an individual fulfill the purpose to invest for their other goals.
While leasing gives so many advantages, it is not an attractive option. The preference between buying a car versus leasing can also be a lifestyle choice.
For people who prefer driving a new car find the lease option more appealing. Since the monthly payments are less costly than buying a car, they can drive cars than could afford to buy.
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