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Dealer Financing
Most Dealerships offer vehicle financing through local financial institutions and/or the vehicle manufacturers
they represent. When you're shopping for a car, be sure to ask your dealer for details on any financing plans they
may offer.
Should I buy or lease my next car?
Leasing is an option which allows you to pay for the portion of the vehicle's value you expect to use over a
period of time, plus borrowing charges and applicable taxes.
Advantages of leasing:
- Lower monthly payments than buying.
- Drive a more luxurious model or get more features than if you financed.
- Lease terms are shorter than most finance terms so you can drive a new car more often.
- Drive a vehicle during its most trouble-free years.
- Avoid trade-in obligations.
- Choose to walk away at the end, or lease your next car.
- Pay taxes only on your monthly payment.
The details on leasing:
- Up-front costs:
May include first month's payment, a refundable security deposit, a down payment and other miscellaneous fees.
- Monthly payments:
Usually lower than traditional finance payments because you're only paying for
the depreciation of the vehicle over the lease term, along with the other charges
(i.e. monthly tax and borrowing charges).
- Annual KM's:
24,000 km for a typical lease. You may buy more KM's up front or pay per
KM over the limit at lease end.
- Excess wear and tear:
Usually assessed at lease end. Ask your dealer for further details. Maintenance
and repairs are your responsibility.
- Insurance:
Required for the amount of coverage specified by your lease.
Traditional financing is an option whereby you borrow the amount you need to
buy your vehicle, then repay that amount, plus interest, with the long-term goal
of owning it.
Advantages of buying:
- You will own the vehicle .
- The vehicle will be registered under your name.
- The bigger your down payment, the less you pay each month.
- You can trade in your current vehicle to add to your down payment
- You can keep your vehicle as long as you wish.
- There are no KM's restrictions.
- There are no wear and tear limitations.
- You may alter your vehicle any way you wish.
The details of buying your vehicle:
- Up-front costs:
Down payment, registration fees and other charges.
- Monthly payments:
Usually higher than lease payments because you're paying for the entire purchase price, taxes and finance charges.
- When payments end:
You own your vehicle. You can choose to keep it, sell it or trade it in.
- Wear and tear:
Is your responsibility. In excess, it may lower your trade-in or resale value.
- Insurance:
Coverage is required for the amount specified by your finance contract.
- To change vehicles:
Once fully paid for, you must sell it yourself, or negotiate a trade-in price when buying or leasing a new vehicle.
- Annual KM's:
Unlimited. Drive as far and as often as you want. Keep in mind high KM's
may affect trade-in or resale value.
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