Car lease question

Elom · ‎06-15-2010

I have a Toyota that is leased and soon the lease will end. I need advice from anyone as I am really struggling with an issue.

It only has 24000 miles on it which is low mileage and I don't know if it is a wise decision to just keep it and finance the residual which is 16K or get another lease.

I believe the dealer is the winner no matter what I decide because the car doesn't have a scratch on it, low mileage. Any thoughts? Thanks.

software · ‎06-08-2016

Instead of buying your current car, see about buying a new car. This is a good time to buy, the 2018s will be coming out & you may get a really good deal on a 2017

Whenever I went from a lease to a buy at the same dealership, I got a good deal on a new car. And they didn't ding me on mileage or wear&tear.

@Limbo4now wrote:
I have a Toyota that is leased and soon the lease will end. I need advice from anyone as I am really struggling with an issue.
It only has 24000 miles on it which is low mileage and I don't know if it is a wise decision to just keep it and finance the residual which is 16K or get another lease.
I believe the dealer is the winner no matter what I decide because the car doesn't have a scratch on it, low mileage. Any thoughts? Thanks.

ECBG · ‎01-08-2011

It's best to get out from under those agreements as soon as you can. The longer you don't the extra cost just waits on you.

151949 · ‎03-09-2010

I would google the blue book value on your car and see what it is worth. Probably the dealer will want more if they sell you your car now and you may want to back away from doing that. If you have that information you are in a good place to negiate with them about the price.Be informed when you go into the dealer.

CelticCrafter · ‎03-09-2010

What year is it?

I might be just me but $16,000 seems like a lot for a used car.

software · ‎06-08-2016

@CelticCrafter wrote:
What year is it?

I might be just me but $16,000 seems like a lot for a used car.

Depending on which Toyota she has, that could be correct.

Toyotas are expensive and hold their value

gidgetgh · ‎03-09-2010

@Limbo4now wrote:
I have a Toyota that is leased and soon the lease will end. I need advice from anyone as I am really struggling with an issue.
It only has 24000 miles on it which is low mileage and I don't know if it is a wise decision to just keep it and finance the residual which is 16K or get another lease.
I believe the dealer is the winner no matter what I decide because the car doesn't have a scratch on it, low mileage. Any thoughts? Thanks.

@Elom- I might be the dissenting view here, but here goes. I'm not a fan of leasing.

You're just finishing up a lease, so you've been paying monthly.

You mention that maybe you should buy that car and finance the balance. More payments.

Or lease again. Yet more payments. Which, at the end of that lease, you'll be faced with the same decision again.

For ME, the payments have to stop at some point and I want something in return for my money. You keep paying and paying and paying and you have nothing but air at the end. If I'm going to make payments, then by gosh, I want a car at the end of the rainbow.

Otherwise, I might as well just go to Hertz and rent one. You're doing the same thing.

Why is it, when I have a 50/50 guess at something, I'm always 100% wrong?

esmeraldagooch · ‎03-10-2010

From Dave Ramsey

QUESTION: Listener asks Dave to break down the mathematical flaws in a car lease.

ANSWER: A car fleece is basically renting a car. You pay $400 a month and at the end of the new car lease, you turn it back in. If you want to buy it, you are buying it for what they estimate at the beginning of the fleece to be the market value. At the end of the lease, it’s called the residual value. If you pay $400 a month for 60 months, you pay $24,000 before turning it in. The car will not have gone down in value more than that, because the car companies would lose money if it did. When they get the car back, you will have paid them more than the car has depreciated during that time.

During that time, you’re maintaining the car as if you owned it. You’ll get charged for excessive wear and tear, or if you put too many miles on it. If you rent it for $24,000 and it went down $15,000 in value, then it cost me $9,000 to rent this car for this period of time. That is their profit during that time.

Another thing is that the interest rates on a vehicle lease are not disclosed because the Federal Trade Commission has determined that this is not a debt, so there is no federal disclosure involved. Therefore, you have no truth in lending disclosure sheet. The interest rates you get charged are unbelievably high. That’s where you’ll realize you got screwed over.

People get sold automobile leases because they are told that it’s what sophisticated people do. But as it turns out, the car companies make more money on leasing you the car than if you bought the car with cash, according to the National Auto Dealers Association. Broke people think ‘how much down and how much a month’. Rich people think ‘how much’. If you can’t pay cash for a car, then ride a bicycle. But don’t lease a car

Plaid Pants2 · ‎03-14-2015

@esmeraldagooch wrote:
From Dave Ramsey
QUESTION: Listener asks Dave to break down the mathematical flaws in a car lease.
ANSWER: A car fleece is basically renting a car. You pay $400 a month and at the end of the new car lease, you turn it back in. If you want to buy it, you are buying it for what they estimate at the beginning of the fleece to be the market value. At the end of the lease, it’s called the residual value. If you pay $400 a month for 60 months, you pay $24,000 before turning it in. The car will not have gone down in value more than that, because the car companies would lose money if it did. When they get the car back, you will have paid them more than the car has depreciated during that time.
During that time, you’re maintaining the car as if you owned it. You’ll get charged for excessive wear and tear, or if you put too many miles on it. If you rent it for $24,000 and it went down $15,000 in value, then it cost me $9,000 to rent this car for this period of time. That is their profit during that time.
Another thing is that the interest rates on a vehicle lease are not disclosed because the Federal Trade Commission has determined that this is not a debt, so there is no federal disclosure involved. Therefore, you have no truth in lending disclosure sheet. The interest rates you get charged are unbelievably high. That’s where you’ll realize you got screwed over.
People get sold automobile leases because they are told that it’s what sophisticated people do. But as it turns out, the car companies make more money on leasing you the car than if you bought the car with cash, according to the National Auto Dealers Association. Broke people think ‘how much down and how much a month’. Rich people think ‘how much’. If you can’t pay cash for a car, then ride a bicycle. But don’t lease a car

And this is precisly why I have always thought that leasing was a scam.

Some people just MUST have the leatest and greatest with all the bells and whistles, and it's an image thing. "Look at me! Look at what *I* am driving!"

With a lease, they nickle and dime you for "excessive wear and tear", which is subjective, and of course, it always favors the deaership.

Nope, pay cash, and you'll have something to show for it even if you have to finance it.