To buy or to lease? That is the question

To buy or to lease? That is the questionMany prospective car owners waver between buying and leasing a car. While leasing offers lower payments, buying is an investment, and drivers will have something to show for their money once the term of the payment is up, Smart Money reports.

The news source says that the decision to buy or lease is a personal one, and depends on a driver's lifestyle and needs. Leasing has advantages such as a low down payment and lower monthly payments than buying a car, but drivers may pay extra if they drive over a certain mileage limit or inflict any damage on the interior or exterior of the car. In addition, insurance may not cover the remainder that the driver owes on the lease.

If drivers cannot afford to put much cash down on their down payment, leasing might be a good option, as many dealers will waive the down payment and only require drivers to pay the fees, down payment and security deposit.

Drivers with bad credit may be tempted to lease because they want a lower monthly payment, or think they cannot get a car loan because of their credit. However, there are many bad credit auto loans available, and making timely payments on a car can build good credit.