Financing vs. Leasing in Cambridge, Ontario


Car shopping in 2023 is more stressful than ever before, due to rising rates and increased costs. So our team at Cambridge Centre Honda is ready to help you make getting into your new Honda vehicle as easy and stress-free as possible, including when it comes to sorting out your leasing or financing details. The choice between financing and leasing a new car, truck, or SUV may seem daunting to the uninformed, as the best answer truly depends on your personal financial situation and lifestyle. Generally speaking, leasing offers lower monthly payments and the benefit of a new car every 2-3 years, compared to financing. However financing offers the benefit of total ownership. For a thorough breakdown of what's best for your financial situation and outlook for 2023, book your financing consultation appointment with our expert financial advisors here at Cambridge Centre Honda.

Leasing a Vehicle

Choosing to lease your new vehicle offers several advantages compared to financing.

Lower monthly payments, driving a new vehicle every few years, and having repairs covered under warranty are the advantages lease-drivers enjoy. A few drawbacks of leasing include a limit to the kilometres you can drive over the term, as well as no vehicle ownership after your term expires.

  • Pros:
    • Lower monthly payments
    • Maintenance under warranty
    • Opportunity for a new car every 2-3 years
  • Cons:
    • Must properly maintain to a reasonable standard
    • Kilometre limit over duration of lease term
    • Must properly maintain to a reasonable standard

Financing a Vehicle

Financing allows you to have complete ownership of your car once your loan has been fully paid off, freeing you from monthly payments to your lender. You may also add personal customization and modifications as you wish to your vehicle, something that isn’t allowed while leasing.

  • Pros:
    • Complete vehicle ownership
    • No payments after you’ve paid off the loan
    • Can drive for long-term
    • Freedom to customize your vehicle
  • Cons:
    • Responsible for repair costs after warranty expires
    • Higher monthly payments

Does Leasing or Financing Affect Insurance?

No matter which choice you make, your insurance will be unaffected by either financing or leasing your new vehicle. The factors that affect your insurance include driving history, the type of vehicle you drive, where you drive, and how long you’ve been driving. With your insurance, the name of the leasing company or financer will be listed on the insurance policy. In the event of an accident and write-off, insurance will pay the leasing company or financer first, and if your vehicle is worth more than what you owe, you will receive the outstanding amount.

Financing vs. Leasing: Bad Credit

The question of choosing financing or leasing is impacted by your credit score. Typically, buyers with a lower credit rating can still secure financing relatively easily, but will be subject to higher rates and monthly payments. When it comes to leasing, typically drivers may not be approved if they have lower credit scores, as lenders cannot retain the vehicle as collateral, since the driver does not “own” the vehicle. Furthermore, when financing with a lower credit score, as long as you make your payments on schedule, you’ll actually improve your credit rating over the course of the loan. So for prospective buyers with lower credit scores, stick to financing for more consistent approval, as well as improving your own credit rating. Talk to our financial advisors here at Cambridge Centre Honda for more details.

How can Trade-Ins Affect Financing?

Now more than ever, it's a great time to consider trading in your current vehicle towards a new Honda at our Cambridge dealership. The increased value you could potential receive upon appraisal can significantly reduce the amount you need to finance your new Honda model for. Connect with our team today if you're interested in trading-in your current vehicle (any make or model) to get an even better deal on our already-affordable new vehicle inventory in Cambridge.

For all your new vehicle financing or leasing questions, get in touch with our expert team here at Cambridge Centre Honda’s Financing Department, helping you secure the right financing or leasing terms for your new Honda vehicle. Book your appointment today, and come visit our Cambridge, Ontario location, serving everywhere from Brampton to Toronto. For the best new Honda inventory in Cambridge, visit Cambridge Centre Honda today.

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