Leasing is essentially and can be used to describe the finance of almost anything but in recent years it has become associate with cars. So why has contract hire and leasing become so popular recently? There could be a series of motivational factors behind this trend, one of those is most likely to be the fact that there are many specialist leasing firms. It may also be a tactic from manufacturers to stimulate the market in recession, since leasing certainly seems like a cheaper option than buying and it certainly requires less commitment.

So how do you know if leasing is for you? Well leasing is ideal if you like to change your vehicle every couple of years, but bear in mind that if you lease constantly, it will eventually work out a lot more expensive than buying, that is if you would have otherwise kept the same car for years. A 15 thousand pound car like a mazda mx-5 will cost around 200 per month to lease, plus the deposit, this means that if you continue to lease this means that if you keep paying you will have paid the car off in about 4 years.

Of course in that time you will have paid more than the 15k list price with the added interest. If you are really concerned about the rade off between buying and leasing then you can roughly work out how much leasing will cost over say, 3 years, then work out the amount you’d loose if you brought a car. After the numbers have been crunched however you are likely to find that that costs are about the same, leasing does mean however that you have a wider choice. Check out this Idiot’s guide to car leasing for more details.