New Cars: Buy vs Lease
06-01-2006, 10:43 PM
#1
4000 Watt CAFz'r
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New Cars: Buy vs Lease
So we're looking to get a new car, whats everyones opinion on leasing vs buying?
Buying obviously you get to keep the car in the end, but your stuck with an investment that does nothing but depreciate and a higher monthly payment.
Leasing you get a lower payment, you dont get to keep the car unless you buy out the contract at the end. BUT you do get a newer car that you can turn in at the end of your lease for a newer model.
Opinions?
Buying obviously you get to keep the car in the end, but your stuck with an investment that does nothing but depreciate and a higher monthly payment.
Leasing you get a lower payment, you dont get to keep the car unless you buy out the contract at the end. BUT you do get a newer car that you can turn in at the end of your lease for a newer model.
Opinions?
06-01-2006, 10:59 PM
#2
if you open a company can can right the Lease off so if you have a high Lease with a low buy out then buy it out it your name not the company name the company does not need to make $ untill the 7th yr .i do not have time to get into it now
06-02-2006, 03:30 AM
#3
if u bought a car then u will depreciate right off when u drive off that lot , unless u bought a used car. But when it brakes down u are f*ck@d so u will have to pay from your pocket again to get it fixed. Now if u leased it u have to pay monthly but doesnt bind up your cash flow so u can still get nice stuff for yourself. Free bumper to bumper maintainance for 3 years or so then buy that sucker out or just give it back. Last Finance is rent to own with an higher monthly payment so this is when your calculator comes into play. U get the same warrenty but u pay more monthly and interest will go towards the company vs u buy and depreciate all together . So its all kinda the same thing so u just got to figure how much u have to sepnd on this new car
06-02-2006, 10:26 AM
#4
Of the 5 brand new cars I've purchased since 1997, my latest one, a 2005 Magnum R/T is the first one I've leased. I've always long been against leasing. I didn't like the idea that you basically rent the car and don't get anything back from the car when the lease period is up. If you put money down on it, that money is gone. The only thing it does for you is lower your payment. Leasing is great if you have no money to put down on the car and don't expect to get money back to use as a down payment on your next one, etc. Unfortunately, leasing always requires money up front for things like security deposit, first payment, last payment, just because fees, etc. I think though some cars you can buy offer plans of really no money up front. Of course their are always the dealer BS fees that you can't avoid but they are small compared to the usual leasing up-front fees.
The bonus is that yes, you can have a lower payment but thats only if you are comparing putting no money down on a 3 year term on a car based on lease vs. finance. You are only paying for the calculated depreciation of the car over the lease period. So you might plan to usually finance a car for 5 years but know you'll sell in 3 and make your down payment back at least which could be cheaper than leasing for 3 years with no money down. I often found when I was comparing finance for 5 yrs. vs. lease for 3, it was about the same. Sometimes cheaper because most often finance interest rates are lower than lease rates.
We chose to lease the Magnum because simply there was no way we could afford financing the car with the money we had to put down on it
Yeah the silly part of that decision is that down payment money will never come back unless at the end of the term we try to sell the car for more than the buyout amount. But the only way to recoup the money put down on it is to sell it for buyout (17k) + down payment we originally had + taxes. Probably not going to happen. I'm sure a 3 year old Magnum R/T that originally stickered for $42k will in 3 years be worth more than 17k but it might be only low 20s. We'll see when we get there.
So to conclude, find out what kind of monthly payment you can afford first. But DON'T tell the dealer that or do a deal based on monthly payment pricing. They love that. Then go to the manf's website and play with their leasing calculators. That should tell you what car you can get for the money you have, or what money you need to put down to get what you want. I wouldn't recommend putting a large chunk of money down just to get the car you want. We did that but we also will probably never get to drive such a relatively expensive car again for many years (until my 10-month old daughter is out of college or something lol) so we thought we'd have some fun for a few years. Also, you CAN negotiate the price of the car with leasing just like you would if you were financing. One of the first questions the dealer will ask is lease or finance. Just say you are considering both. When it comes time to numbers, deal on the price of the car, not the monthly payment. Advertised lease payments are almost always based on full sticker price of a car, maybe with manf rebates figured in. You can get them lower. I think when we first started talking lease numbers on the Magnum, the dealer was $600+ along with our trade. We ended up at $475, taxes in. Its a 3 yr. lease at 0%.
The bonus is that yes, you can have a lower payment but thats only if you are comparing putting no money down on a 3 year term on a car based on lease vs. finance. You are only paying for the calculated depreciation of the car over the lease period. So you might plan to usually finance a car for 5 years but know you'll sell in 3 and make your down payment back at least which could be cheaper than leasing for 3 years with no money down. I often found when I was comparing finance for 5 yrs. vs. lease for 3, it was about the same. Sometimes cheaper because most often finance interest rates are lower than lease rates.
We chose to lease the Magnum because simply there was no way we could afford financing the car with the money we had to put down on it
Yeah the silly part of that decision is that down payment money will never come back unless at the end of the term we try to sell the car for more than the buyout amount. But the only way to recoup the money put down on it is to sell it for buyout (17k) + down payment we originally had + taxes. Probably not going to happen. I'm sure a 3 year old Magnum R/T that originally stickered for $42k will in 3 years be worth more than 17k but it might be only low 20s. We'll see when we get there.So to conclude, find out what kind of monthly payment you can afford first. But DON'T tell the dealer that or do a deal based on monthly payment pricing. They love that. Then go to the manf's website and play with their leasing calculators. That should tell you what car you can get for the money you have, or what money you need to put down to get what you want. I wouldn't recommend putting a large chunk of money down just to get the car you want. We did that but we also will probably never get to drive such a relatively expensive car again for many years (until my 10-month old daughter is out of college or something lol) so we thought we'd have some fun for a few years. Also, you CAN negotiate the price of the car with leasing just like you would if you were financing. One of the first questions the dealer will ask is lease or finance. Just say you are considering both. When it comes time to numbers, deal on the price of the car, not the monthly payment. Advertised lease payments are almost always based on full sticker price of a car, maybe with manf rebates figured in. You can get them lower. I think when we first started talking lease numbers on the Magnum, the dealer was $600+ along with our trade. We ended up at $475, taxes in. Its a 3 yr. lease at 0%.
06-02-2006, 11:02 AM
#5
if u lookin for a brand new car - lease
used car - buy/finance
you can get cars that are 2-3 years old in very good shape and decent milage for $20,000 cheaper than what they were brand new.
my 2004 jeep was like $45k to buy brand new. now u can get the same car for $21-$22......u finance that and u good.
used car - buy/finance
you can get cars that are 2-3 years old in very good shape and decent milage for $20,000 cheaper than what they were brand new.
my 2004 jeep was like $45k to buy brand new. now u can get the same car for $21-$22......u finance that and u good.
06-02-2006, 03:53 PM
#6
50 Watt CAFz'r
Join Date: Aug 2000
Posts: 410
I'd never buy a new car again, if you figure out how much they depreciate and thus how much you spend per year to drive it it's a bit retarded.
I've had my car for 6yrs now, bought it for $17K and now it's worth maybe $6K so $11K down the tubes in 6 years or $1833/yr just to drive the car let alone plates and fuel.
If you're planning to own the car for a long period of time new might be worth it, but like said above look for a buyback that's maybe only a year or two old and has 20K or so on the motor, you'll save a load of cash in the long run and still have a practically new vehicle.
I've had my car for 6yrs now, bought it for $17K and now it's worth maybe $6K so $11K down the tubes in 6 years or $1833/yr just to drive the car let alone plates and fuel.
If you're planning to own the car for a long period of time new might be worth it, but like said above look for a buyback that's maybe only a year or two old and has 20K or so on the motor, you'll save a load of cash in the long run and still have a practically new vehicle.
06-02-2006, 04:46 PM
#7
here is the break down
when u rent a car its $25 a day say u get a deal and rent it for a month say $500 u dont have to worry about anything excpet gas
Say u buy a crappy Chrystler for 20k cash down the road like 5 years that car will be worth 10k or so ,so your lossing your butt off
Say u lease that car u can just give it back and call it a day $200 a month lease it for 3 year and so what !! still cheaper than renting a car. So i would just lease it and forget about anything cause u have maintainance free
But like they say u can buy an older car and save on Tax , shipping , and all the extra Bs but u have to fix it if anything is fooked up about it
when u rent a car its $25 a day say u get a deal and rent it for a month say $500 u dont have to worry about anything excpet gas
Say u buy a crappy Chrystler for 20k cash down the road like 5 years that car will be worth 10k or so ,so your lossing your butt off
Say u lease that car u can just give it back and call it a day $200 a month lease it for 3 year and so what !! still cheaper than renting a car. So i would just lease it and forget about anything cause u have maintainance free
But like they say u can buy an older car and save on Tax , shipping , and all the extra Bs but u have to fix it if anything is fooked up about it
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