In NB, what should I know about leasing vs financing for car loans?

In New Brunswick, choosing between leasing and financing for a car loan involves distinct financial implications and lifestyle considerations, especially with current market conditions heading into 2025. Leasing typically offers lower monthly payments because you are essentially paying for the vehicle's depreciation during your term, plus interest (known as the money factor), and the 15% NB HST is applied only to these monthly payments. This option is ideal if you prefer driving a new vehicle every few years, desire predictable maintenance costs often covered by warranty, and have a consistent driving pattern that stays within specified mileage limits, avoiding potential overage charges at lease end. Conversely, financing means you are purchasing the vehicle outright; the 15% NB HST is applied to the full purchase price upfront and usually rolled into your loan, leading to higher monthly payments. However, financing builds equity over time, offers unrestricted mileage, allows for full customization, and provides the freedom to sell or trade the vehicle whenever you choose without lease-end penalties. This path is generally more cost-effective in the long run if you plan to keep the vehicle for many years beyond the loan term. Given the current interest rate environment, the difference in monthly payments between leasing and financing can be more pronounced, making it crucial to assess your long-term ownership goals, annual mileage, and desire for equity versus lower immediate out-of-pocket costs.