The Turn Difference: Car Financing, Leasing and Subscription Explained
The way we use cars has changed – and there’s no going back. Today, drivers have more options than simply shelling out their savings for a new set of wheels. But with hidden fees and Ts&Cs often part of more modern payment plans, it’s easy to get confused.
To make things clear, here’s our guide to the pros – and cons – of car financing, leasing and subscription.
Many Americans looking to buy a new or used car won’t be able to cover the full purchase cost upfront – this is where car financing or loaning comes in.
The process involves entering a contract with a lender who helps bridge the gap between your deposit and the cost of the car. You will then pay back the loan, with interest, over a fixed period of time.
Some reports show that nearly half of all U.S. adults are currently paying off a car loan. To get a loan, you’ll need to go through a credit approval process which will usually determine the interest rate you’ll pay. If you’ve got a lower credit score, you might struggle to find a lender. Or, if you do find one, you could be stuck paying higher rates of interest.
If you’re thinking of car financing it’s important to consider your budget upfront, before jumping straight into searching for your car. If you don’t, there’s a risk of ending up with an unmanageable loan. That could see the car repossessed in the short term, and even affect your credit rating in the long term.
Car leasing is like getting a long-term rental car but over a much longer period of time, typically 2-3 years. What you pay covers the cost of the expected depreciation of the vehicle during the term of the lease, as well as loan interest and other fees.
Unlike long term car rental, you will also probably need to put down an upfront deposit and then a monthly payment for a fixed period of time (most leases last two or three years). When the lease is up, you can either purchase the car, lease another car or choose a non-leasing option. Leasing is increasingly popular because you can effectively drive home a new car, and trade it in for another model within a few years.
However, there may be conditions that come with the lease. This can include things like how many miles you can drive, maintenance requirements and specifications around the condition of the car when returned.
It’s worth bearing in mind too that to qualify for a lease your credit has to be strong and if you are unable to make your monthly lease payments, there might be significant penalties.
However, there may be conditions that come with the lease, including things like how many miles you can drive, maintenance requirements, and specifications around the state of the car when returned.
It’s worth bearing in mind to qualify for a lease, your credit has to be healthy, and if you are unable to make your monthly lease payments, there might be significant penalties.
Car subscription is the modern, flexible alternative for the vehicle usage market. A subscription model gives you the freedom and convenience of a car with none of the hassle; car subscriptions are like any other monthly subscription – from Netflix to Spotify.
You sign up, choose your car and pay a fixed monthly charge for however long you want to use the vehicle.
Turn car subscriptions work on a transparent model that prioritizes choice, flexibility, and savings. After an upfront starter payment, your flat monthly fee doesn’t change, so you know precisely the amount you will pay on a month to month basis.
Included in your payment, are the following:
Collision and comprehensive insurance*
Maintenance including a loaner car delivered to your door
Roadside assistance to help you back on the road if you get into trouble
If you decide you’d like a different car model, you can change vehicles twice within a year (terms apply) to find your perfect drive. And if you no longer want your car, you can cancel the subscription at any time with no hidden fees or fines.
It’s Your Turn
Navigating the world of car financing and leasing can feel like driving along with a winding road with hidden twists and turns lurking around every corner. With Turn car subscriptions, the path is straight and bright, with no obstacles in your way. If you want a stress-free way of regularly using a car, jump on the new wave of vehicle ownership.
To sign up for a car subscription in Los Angeles, San Diego, or anywhere else in Southern California, find your perfect drive today.
Driver Eligibility requirements
*Driver must obtain their own liability insurance
*Driver must be 21 years of age or older
*Driver must have had a active drivers license for over a year.