10 Questions about Buying versus Leasing | Busting the Myths

Harry Umphlett - Sales Consultant and 
Scott Sullens - Business Manager from BIGGS Cadillac Buick GMC Trucks, in Elizabeth City, North Carolina went to the Elizabeth City Area Chamber of Commerce.

Scott and Harry spoke about Financing versus Leasing in today's marketplace and discussed the general myths in the automobile industry and the customers approach in the buying of a new or used vehicle in today's market.
They talked about lease alternatives, lease terms and mileage, and financing options. Other subjects touched on were about taking a customer's current auto loan and modifying them, to help save some money, and about the different lenders and their requirements. They also spoke about BIGGS, the services that are offered as a company, how long we have been in business and who we are, what we represent.

After their presentation, I interviewed Scott to see just what kind of good information was shared. I felt that others could benefit from what was talked about.

Q. What are some of the myths about buying a car?

•  "Some of the myths I think are when someone comes in to purchase a vehicle, the salesman consults with them for a period of time, and then they get up and they want to know what is the magic that happens between them and the sales manager. 

The truth is that there is not any real magic, that is a pretty simple process, that we present customers with numbers that may work for the customer to be able to purchase a vehicle that will suit their  needs, and if we can do it great, we can make it good for the customer and good for the company.

Scott Sullens - Business Manager

If the numbers are not agreeable, then we are still going to be friends. Just trying to put it out there that there is not a lot of back and forth, and all day long, and it doesn’t have to be a grinding process. That it should be a simple thing. We try to share with them that we try to make it a fun, quick process as much as it can possibly be here at BIGGS."

Q. What is it that the customer can possibly do before they come in to make the process easier and cleaner cut?

• "Well, the biggest thing they can do is to try to narrow it down to a couple of vehicles that they are interested in, in terms of and SUV or a sedan, something four wheel drive or not, a van versus a car. Those things will narrow down the search and time that is spent at the dealership. When someone comes in and doesn’t’ have the first clue of what they want, that’s when it can take a long time, because we’re really walking around endlessly trying to narrow it down."

Q. Does a credit score have anything to do with how easy or hard it is to get financed?

• "It does. The better the credit score, the much quicker that it goes and the better the rate. However we know, that’s in a perfect world and that 90% of us have problems or blemishes on our credit. We deal with it all the time and fortunately we have over 20 lenders that we work with that can accommodate everybody’s situation."  

Q. So your saying just because your credit isn’t perfect doesn’t mean you can’t get a loan?

• "Not at all. In fact, the banks are lending money. We see that every day. So there we go, we’re back into doing things, and that is a good sign."

Q. What about buying versus leasing, what are the big differences in them and the pluses and minuses of leasing a car?

•  "Leasing can be a great thing for the right company or the right person. The key to leasing is that Cadillac and GMC are running specials on certain models and the Buick Verano with a 2 year lease. It’s a 10,000 mile year lease.

It requires some money out of pocket. We can tailor a lease to meet a customer's needs, in terms of mileage, and money that is required to start the lease. A lease can have tax advantages for a business, they can always check with their CPA, that can be a possibility. Certainly we can look at the benefit of leasing for someone (an individual). 

Really leasing is ideal for someone who likes to have a car every two or three years, and likes to keep up with the latest technology. Leasing allows you to do that without really hurting yourself financially at all."

Q. 10,000 miles, Leasing is good for people or companies who don’t have to put a lot of mileage on a car?

• "Correct. Now in the case with a company, a lot of mileage can work too. Because being a business they can have certain write offs and such like that, that it works out.  But what we don’t want to happen is the old reputation that leasing had surprises at the end. That comes from, a person leasing a car and they had 12,000 miles a year in the lease up front and they really needed to have 15,000 miles. At the end of it, with the mileage penalties, that can add up to a lot of money that the customer would have to pay."

Q. So with leasing, there is other options, or packages other than the main one that is presented or advertised, that you see?

• "Absolutely, and we can specifically tailor a package to fit the customer's needs."

Q. So the advantage of a lease over buying a vehicle is the fact is that it’s a tax advantage?

Scott and Harry with members of the Elizabeth City Area Chamber of Commerce

• "It can be. I am always careful to say that when we do lease cars here at BIGGS to our corporate clients. I always explain to them. A lot of times they know ahead of the time. When I am asked, what kind of tax break do I get? You need to check with your tax consultant or CPA. There can be some substantial breaks for you."

Q. Can you think of any tips for a customer before they come into buy a car?

• "One of the keys things is to make sure that they have all the parties with them that are involved in the purchase. All the people that need to sign the paperwork need to be here. If a spouse comes in and they need the other half to come in, then we are going to need another appointment or we are delaying it."

Q. How about insurance, should they have a policy in place before they come in?

• "No, as long as they have full coverage insurance in place on another vehicle in their household, then they are covered by most insurance policies for a short period of time. We will call their insurance company once the transaction is complete; to finalize, add that car on, and take the other car off, if that is the case."

Scott. Thank you for your time. I really think that this is great information and I look forward to sharing it with others. 

• "Thank you"

written by Michelle Hatfield