Leasing and financing offer different advantages and disadvantages for drivers in the Fayetteville, NC area, and knowing the difference is one of the more important things you will need to learn while car shopping. If you habitually finance your cars, you may be surprised to learn that leasing is a better fit for you, or vice versa. And it is always a good idea to familiarize yourself with the two processes in case your circumstances have changed since you last got a new car.

Leasing is common among individuals who need a vehicle for business purposes, but it is ideal for anyone who doesn't need to travel long distances regularly. It is growing increasingly popular since the low monthly payments associated with leasing allow drivers to afford cars that may have otherwise been outside their budget. It also appeals to drivers who like to upgrade to a new car every few years.

The dealership owns the leased vehicle. Leases are similar to rentals, but with a set length of time for use rather than a continuing basis.

Depending on your specific lease plan, you may be required to make a small down payment and/or the first month's payment, a refundable security deposit, as well as any taxes and fees.

Because lessees don't own the VW they drive, they aren't affected by depreciation. However, they won't build equity on the vehicle either.

When the lease period is up, lessees return the vehicle to the dealership, and can then lease a new model, purchase the vehicle they have been driving for the residual value laid out in the initial lease contract, or walk away. If there is damage beyond expected wear and tear or additional mileage in excess of what was agreed upon, the lessee will be charged for it.

If you're the type of driver who likes to work on your car, go on road trips, or add aftermarket parts or accessories to your vehicle, then purchasing a VW is your best bet. People who tend to hold onto their car long past the 100,000-mile marker are the right market for financing.

You own the car. However, if the lender has a lien on the title, you will need to pay off the remaining balance on the car if you decide to sell it before you've finished your payments. You can do this using the money earned in the sale.

You can pay the full price up-front, or finance the vehicle. If you choose to finance, it typically requires a down payment, taxes, license and registration fees, and other charges such as insurance.

Purchased vehicles will experience depreciation, but its cash value belongs to the owner.

Once drivers have turned in their final auto loan payment, they will receive the vehicle title from the lender, and own the vehicle free and clear.

Feel free to contact the auto finance team at Valley Auto World Volkswagen in Fayetteville, NC with any additional questions you may have about the finance or lease process at our VW dealership.