Car lease question - Page 2

CAcableGirl2 · ‎06-03-2010

I've leased and I've purchased both new and used cars. Since the lease is usually only for 3 years and if you have little miles on the vehicle, it might make sense for you to purchase it outright at the end of the lease. It really depends on what you can afford, the current value of the vehicle and how much the payments will be each month (and most importantly, for how long). If you return the vehicle, you then have to either lease another vehicle or purchase one. If you don't need a car, fine, just return it, but most likely, you will still need some sort of vehicle. If the residual is $16K, depending on the car, that might be a great price for a car only 3 years old. If you can afford to pay off the $16 with a low interest loan from your credit union in a couple of years then that would be what I would look at. Most new and even some used auto loans are at 5 years, so try to purchase it in 2-3 if you can affort the payments so the overall amount of time paying on the vehicle doesn't go out longer than it should.

If you decide to purchase a new car, then the payments start all over again, higher registration and insurance payments as well.

If the car has had little or no issues, the residual payment is less than the current market value of the car, and you are happy with the car, and can affort to payoff the $16K in 3 or less years...I would probably buy it.

Since you are the only one who knows what you can comfortably afford, sometimes leasing is a great option.

......You look like I need a drink.....

millieshops · ‎03-09-2010

If you're making a straight math decision, you'll probably find out the wisest thing to do would be to turn the car in and drive a much cheaper car for a while so that you can accumulate some money to buy a better car!

But many big financial decisions are not straight math decisions - when I was selling real estate I sold plenty of houses that I would never have bought myself had I been in the financial condition of my buyers - and I know lots of people who pay to lease their cars because they want or need to be driving a newer or bigger car than they can buy outright. Part of the decision isn't just about the money.

Still - I'd do the math first so that I'd know why I was spending what I decide. How much would a similar new car cost, what's the monthly with the down payment I have and for how many years?

Also research funding the cost of your leased car and don't assume the dealer is the best place to do the financing - I always investigate financing even if I might pay cash just in case and I've never found dealer financing to be better than my credit union financing.

.

SilleeMee · ‎05-22-2016

Sometimes it is not possible to purchase a leased vehicle for which a person has made a contract. This is called a "closed end lease". I don't know the OP circumstance so I can't say if it's possible to buy out the residual. Personally, I would find another car to buy with new financing options.

151949 · ‎03-09-2010

For some people leasing a car is a better choice. In our case , my DH just has to have a new car every couple years. No matter how much he loves his old car - it is really a stretch to get him to wait the 3 years. So , we may as well lease. It's cheaper than buying new cars every couple years AND it forces him to wait the 3 years.

Jaspersmom · ‎06-08-2011

@151949 wrote:
For some people leasing a car is a better choice. In our case , my DH just has to have a new car every couple years. No matter how much he loves his old car - it is really a stretch to get him to wait the 3 years. So , we may as well lease. It's cheaper than buying new cars every couple years AND it forces him to wait the 3 years.

Why does someone have to lease just to have a new car every three years? Couldn't someone purchase a car, trade it in at the end of three years and start all over again? I guess I'd have to sit down and compare the math, but buying even with a loan might still be more cost effective.

https://cars.usnews.com/cars-trucks/buying-vs-leasing

Plaid Pants2 · ‎03-14-2015

@Jaspersmom wrote:
@151949 wrote:
For some people leasing a car is a better choice. In our case , my DH just has to have a new car every couple years. No matter how much he loves his old car - it is really a stretch to get him to wait the 3 years. So , we may as well lease. It's cheaper than buying new cars every couple years AND it forces him to wait the 3 years.
Why does someone have to lease just to have a new car every three years? Couldn't someone purchase a car, trade it in at the end of three years and start all over again? I guess I'd have to sit down and compare the math, but buying even with a loan might still be more cost effective.

https://cars.usnews.com/cars-trucks/buying-vs-leasing

Right, because leasing = renting.

Might as well as go down to Avis or Enterprise, and rent a car from them for three years.

It equalls to the same thing.

151949 · ‎03-09-2010

@Jaspersmom wrote:
@151949 wrote:
For some people leasing a car is a better choice. In our case , my DH just has to have a new car every couple years. No matter how much he loves his old car - it is really a stretch to get him to wait the 3 years. So , we may as well lease. It's cheaper than buying new cars every couple years AND it forces him to wait the 3 years.
Why does someone have to lease just to have a new car every three years? Couldn't someone purchase a car, trade it in at the end of three years and start all over again? I guess I'd have to sit down and compare the math, but buying even with a loan might still be more cost effective.

https://cars.usnews.com/cars-trucks/buying-vs-leasing

We did compare - and found we are better off to lease. Once I got my husband to be honest and admit he is going to buy a new car every 3 years at least.

Plaid Pants2 · ‎03-14-2015

I would NEVER lease a car.

Why?

Because you have nothing to show for it at the end of the contract, except money out of your pocket.

It doesn't make any sense to keep leasing a new car every few years, because you are making monthly payments that will never end.

Wouldn't you rather have that money in your pocket?

I know that I sure would.

I am financing my Toyota.

Once it is paid off, I have more money in my pocket, and a car to show for it.

I win.

With a lease, the dealer wins, and the customer looses, in every which way possible.

Pooky1 · ‎12-23-2015

i agree with you 100 percent. i never want to be making car payments forever. we were thrilled when they were payed off.

sunshine45 · ‎03-09-2010

i agree with those that say that leasing a car is not a good idea.

so much better to buy a new car and then sell it when you get tired of it.....or better yet, buy a newer USED car and use it until you get tired of it and then sell it. i also would never trade a car in.

https://www.moneyunder30.com/why-you-should-never-lease-a-car

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