Everyone has their dream cars. Some wish for luxury cars like Rolls-Royce Dawn; others prefer vintage ones like a Volkswagen Beetle. Practical people would want simpler yet useful automobiles like a van. But the point is people dream of driving a car someday.
Fortunately, this dream is fairly attainable. You can purchase a brand new or used one, enter car financing or a long term car rental.
Realistically speaking, not everyone can afford the upfront price of brand new and used car sales. Their last resorts are car financing and car leasing in Singapore. These two have flexible financial arrangements. But, which one is the best for you? Continue reading this article to find out.
Car Financing VS Car Leasing In Singapore: Which Arrangement Is The Best For You?
One of the distinct similarities between financing a vehicle and trying a private hire car rentalis its flexible financial arrangements. Yet, there are still other significant factors to consider before entering either of the deals. This part will help enumerate the similarities and differences of car financing and car rental in Singapore based on several significant factors. It is up to you to weigh their advantages and disadvantages.
Payment terms are the common ground of car finance and a rental car in Singapore.
Car financing requires a down payment for the vehicle. Generally, the downpayment may include registration fees, taxes, and other service fees. Your car dealer and financial institutions may offer you financial arrangements. If you ever choose banks to finance your vehicle, you can use two loans: a personal loan and a car loan.
A personal loan is a sum of money lent to you to use for different reasons, such as hospitalisation, vacation, and purchasing a car.
A car loan is solely for purchasing or supporting car finance alone.
Depending on the financial arrangement you agreed on, the payment terms can last from months up to several years.
Monthly payment is much higher for car financing than leasing a private hire car rental because you are paying for the whole value of the vehicle.
Similar to vehicle financing, you need a down payment when you rent a car in Singapore. Down payment may also include the first month’s payment, taxes, registration fees, and other service charges.
When you lease a car in Singapore, you can cover its monthly payment using a part of your monthly income and personal loans from financial institutions like banks and money lenders. However, car loans may not support a short term and long term car rental.
Car leasing in Singapore has a bit of an advantage when it comes to payment arrangements. Depending on the contract, the driver can use the car for 90 days up to years. Monthly payment is much lower than car financing. The driver pays for the time they are using the car rather than the entire value of the vehicle.
Generally, the driver shoulders the repair and maintenance of the vehicle. It breaks even with the wear and tear fees for car leasing in Singapore. It is the discretion of the driver whether or not to have it repaired for minor damages. However, drivers must also remember that the car’s condition affects its value. Poor car upkeep significantly decreases its value.
Your car dealer shoulders the maintenance of the vehicle before handing it to you. However, this setting changes depending on the agreement. When you rent a car for a short period, which typically lasts up to 90 days, the car dealer shoulders the maintenance.
For long term car rental that usually lasts up to two years, the driver may take care of the regular car upkeep, depending on what has been agreed upon in the contract.
The agreement may also state extra charges for any minor and major damage the car has obtained within the care of the driver.
LIMITATIONS AND FREEDOM
The driver owns the vehicle in car financing. It means that there are no restrictions on how they want to use the car.
They can customise their vehicles freely. It can undergo repainting, add and remove accessories, and replace other parts.
There is also no mileage limitation. It means that the driver distances wherever and whenever they want.
The driver ina car rental has their hands tied when it comes to customisation. Some dealers approved customisation. In return, the driver will shoulder the fees for the car damages alterations have caused.
Some dealers are stricter when it comes to customisation. They may not allow any alteration of the vehicle, whether or not it is a long term car rental contract.
Car leasing also implements mileage limitations. The driver has to pay charges if they ever exceed the mileage limit.
END OF TERM AND EARLY TERMINATION
When the payment term is complete, the driver now owns the car.
If the driver wants a new vehicle, they can sell the car or trade it. They shoulder the responsibility of finding a buyer or trader and taking care of the title transfers, taxes, and other fees.
If the driver decides to get rid of the car without completing the payment term, the driver can also sell or trade the vehicle. The driver still has the responsibility to complete the payment term with or without the financed car.
After the car rental contract is complete, the driver can purchase the car or enter another private hire car rental contract with the same or different vehicle.
If ever the driver chooses to purchase the car they rented, there are other charges to pay.
If the driver wishes to terminate the contract before the end of terms, they should remit early termination fees. However, the cost of early termination fees is nearly compensating with the price of the remaining weeks or months of the contract.
At the end of the day, the decision of whether to choose car financing or car leasing in Singapore relies on your considerations, including your budget, use, and intentions. Deciding over the two requires a lot of pondering. Which one is the best for you?
CDG Rent A Car provides you with the best and advantageous short term and long term car rental deals in Singapore. Visit CDG Rent A Car today.