American Car Buyers Have Once Again Fallen in Love With Leasing
New data shows that auto leasing hit a record high this year. Currently, the average monthly payment on a lease is about $50 less than it is for car buying with an auto loan.
Customers are now hunting for the lowest monthly payment with a new car or truck, and that often means leasing.
Leasing comeback with auto rebound
Three years ago, just 17.7 percent of vehicles bought with financing were leased.
But leasing has soared since then due to a combination of more aggressive leasing offers by automakers and buyers searching for the best option to keep monthly payments in check amid rising new car and truck prices.
Case in point: pickup trucks. A few years ago, the monthly payment for a 3-4 year pickup lease was often around $500 while buying the same truck with an auto loan would cost approximately $400 per month. Today,the opposite is true, as better terms and the extremely low interest for lease offers make it often less expensive to lease pickups rather than buy. Therefore, pickup truck leasing has gained a lot of popularity.
Amount Financed, Loan Length Climbs
The average transaction price (the final price buyers actually pay dealers) for a new car or truck is now greater than $31,000. The average amount financed by buyers has increased to $26,526.
At the same time, the length of a typical auto loan has increased by a month to 5 years and 5 months.
Because they are taking out longer loans at interest rates that are usually just over 4 percent, many car buyers are changing their approach at dealerships. Car buyers are increasingly taking cash back over the lowest interest rate being offered, because rates are already so low.
Check out CarLeasingSecrets.Com for the lowest current lease deals available near you.