New Vehicle Lease Vs. Loan Differences

When you come to Melloy Dodge consider a new vehicle for you or your family member, it's important to know the difference between a loan and a lease, the two options you'll be given. Melloy Dodge works hard to get you the best deal we can get you, it's up to you how you plan on making those monthly payments a part of your budget!

Lease: 

Lower Monthly Payment: These are considered your monthly "rental" fees, typically lower than a regular vehicle payment because you are not paying for the total price of the vehicle.

Mileage: When you lease you are allotted a certain number of miles that can typically range between 10,000 to 15,000 miles per year. At the end of the lease period, the miles driven will be evaluated. If you've exceeded the allotted miles, the leasing company will charge you per mile over the agreed-upon amount. It's important for you to approximate the miles you drive each year before you commit to a lease, as some companies charge up to .25 cents per mile-- which can really add up!

Say Good-Bye To Being Upside-Down: Because you’re leasing the vehicle for a certain amount of time, you’re typically only paying the amount of depreciation expected over your lease term. 

Fewer, If Any, Repair Expenses: Dealerships often make sure the vehicle is covered by the warranty insurance, so if something mechanical goes wrong you may not be blindsided by costly and unexpected repair bills. 

Condition Responsibility:  For the term of the lease you are responsible for keeping the vehicle in excellent condition on both the interior and exterior. If you do not, you will be assessed charges at the end of the lease. For example, if you hit a curb and scuff a wheel you may be responsible for replacing the wheel-- which can cost you hundreds of dollars.

Loan: 

Monthly Payments: Typically, the cost of your monthly payment is determined by your credit score and the amount you put down and/or trade as part of the down payment. The more you put down, the lower the monthly payment. You should be able to get an idea of what you’ll be paying by utilizing our car payment calculator on our website here. Remember that you're also paying interest on the loan-- something you do not pay in a lease.

Mileage: Because you are paying to own the vehicle outright, you are not limited to the number of miles you can put on the vehicle a year. 

Repair Expenses: As the vehicle owner, you are responsible for vehicle repairs that are out of the warranty window: these typically range somewhere between 3-year/50,000 miles up to 10-year/100k miles. It's important to note here that these warranties may only cover the engine and drivetrain. They are NOT bumper-to-bumper warranties. So, check with your dealer to consider extended warranties-- which will often cover items such as electronics, air conditioning systems, and paint discoloration.

Condition Responsibility:  The condition of your vehicle will determine its value when you are ready to trade for another vehicle-- so be kind to your ride! But, make absolutely sure you keep up with your vehicle's routine maintenance. For example, if you fail to change the oil at appropriate intervals and you damage your engine, you will be on the hook for any repair bills.

Melloy Dodge is New Mexico’s #1 Dodge and Ram dealer! Come on down to the showroom and speak to one of our experienced and professional salesmen. We have deals you won’t want to miss out on and we work hard to make sure you leave with the best deal there is. Come on down to Melloy Dodge, where we always say DEAL!