Leasing vs Buying at Kimber Creek Ford

Which is better?

It all depends on your individual situation.


When you purchase a vehicle and take a loan out on the vehicle you are tied to it for the loan length.  All loans are simple interest loans and can be paid off early with no risk of penalty.  But like all loans through banks the interest is front end loaded and it may take up to 3 years for you to reach equity in the vehicle.  If you trade or sell the vehicle before this time, you are responsible for the negative equity as well.


What most people love about leasing is that there are 3 tangible options that exist at the end of each lease.

First, if you don't like the vehicle and you don't like the dealer, you can turn it in, sign off on the termination, and walk away with no financial responsibility (no negative equity).

Second, if you love your vehicle and want to keep it, you know from day one exactly what you will pay for it.  You will be required to pay tax, title, and license on that portion just as if you purchased it.  The really nice part is that since there is not a large interest rate associated with leasing the price after leasing added to the amount paid during leasing is very comparable to what it would have been if you had just bought it (no financial penalty for leasing it first).

Lastly, most of our customers choose to renew a new lease because the manufacturer's put additional rebates toward a new lease to earn your loyalty.  This drives down the payment in comparison to your first lease and once again you are in warranty and have the latest technology in your hands.


A lot of customers say they don't like leasing because they don't have equity.  Equity is money that has accrued to the benefit of the customer.  Although there is not equity in the form of a trade there is what we call payment equity.  If to purchase a vehicle costs you $550 monthly and to lease the same vehicle costs you $400 monthly, there there is $3,600 in payment equity over 24 months and $5,400 in payment equity over 36 months.  Equity is money in the bank and that is exactly where that savings goes.

What if I get into an accident?

You treat a lease exactly the way you would if you purchased it.  You must carry comprehensive insurance.  If there is damage done to the vehicle you just simply get it fixed at a qualified auto body repair shop.

Also built in to every lease is GAP and Life insurance.  In the event of a total loss there will be no financial responsibility that falls on you other than your deductible.  In the event that there is a loss of life to the leasee, the manufacturer will simply take the car back with no financial burden left on the family.

"I drive too many miles"

To the contrary, leasing was designed for the high mileage driver.  Although you will not end up with as low of payment as the low mileage driver, you will be protected from the rapid depreciation that occurs when you put miles on very fast.  When you stack on the miles and then you add to it the front end loaded interest rates in loans, it is very easy to accrue negative equity very quickly.  If you lease that vehicle what you will end up with is absolutely $0 in negative equity plus you will have saved on payment.


There is a right fit for every customer.  If we can assist you in that decision we would love to answer any questions you may have.


Please speak with our trade advisor for more information.