One of the common questions I am asked is, "should I buy or lease a car?" The answer always depends on the facts and circumstances. Here are some of the variables that need to be considered in determining which option is the best option.

When You Should Buy a Car:
1.   You intend on keeping the car for more than four years;
2.   You expect to drive the car more than 10,000-12,000 miles per year;
3.   You have good credit (prime credit score of 660 or more);
4.   You have enough money to make a good down payment  (20% or more) or to buy the car outright;
5.   You can afford the loan payment;
6.   You use the car for business and tax rules change and allow a larger depreciation write-off.

When You Should Lease a Car:
1.   You cannot afford the higher loan payment;
2.   You do not have much money to put down on a car;
3.   You use the car for business purposes (80% or more), in which case you can deduct the lease payment against business income;
4.   You desire a high-end vehicle;
5.   You like getting a new car every few years;
6.   You do not drive more than 10,000-12,000 miles per year;
7.   You use the car for business and tax rules change, lowering the first-year depreciation write-off.