Know a sales manager at a HUGE local dealership and he wishes EVERYONE would lease. Says it's a real $$ maker for them.

 

Bingo. If it wasn't advantagous to the company/dealership, then they wouldn't do it. There is a LOT of info out there that says most people should stay away from a lease. Leasing can be the way to go in some circumstances, but not usually for the average car buyer. There are also some financial formulas out there that deal with leases and allow you to compare buying a product to leasing it.

 

I leased a Ford Ranger in 1996, wasn't making much money and I could get into the vehicle with a lease but couldn't buy it outright at the time. Long story short, I still have the truck, its been a great vehicle but it would have cost me quite a bit less had I been able to buy it outright in the begining.

 

Now, I do know some people who love to lease based simply on peace of mind. All the maintenance is done for them, oil changes, etc. If something goes wrong with the car they don't have to worry about it, it's all on the dealer. I guess there is something to be said about that, but they pay for that peace of mind too.

I have never leased either. However the falacy in treating a car as an investment is that it loses money. So if you bought stocks that trended in value as cars, then you would go broke. Say you buy a 20,000 dollar car, financed it for 5 years, so paying roughly 25,000, with interest, kept it for 5 more years free and clear, what's it worth at 10 years old and 200,000 miles. Not much. So lease the same sort of vehiclefor 10 years ( that may be three leases, how much have you paid? Probably about the same. I came up with 24,000 for Leasing over 10 years. Sounds like a wash to me, except you do own the 10 year old 200,000 mile vehicle at the end. The one thing I have not hit on is taxes. Do you pay propery tax on leased vehicles like you do bought ones? If so, leasing is looking less attractive.

 

 

Re: property taxes - I think if you lease through GMAC or Ford Motor Credit part of your monthly payment is property tax. Not sure if you lease through , say, 5/3 or Huntington.

 

Bingo. If it wasn't advantagous to the company/dealership, then they wouldn't do it. There is a LOT of info out there that says most people should stay away from a lease. Leasing can be the way to go in some circumstances, but not usually for the average car buyer. There are also some financial formulas out there that deal with leases and allow you to compare buying a product to leasing it.

 

I leased a Ford Ranger in 1996, wasn't making much money and I could get into the vehicle with a lease but couldn't buy it outright at the time. Long story short, I still have the truck, its been a great vehicle but it would have cost me quite a bit less had I been able to buy it outright in the begining.

 

Now, I do know some people who love to lease based simply on peace of mind. All the maintenance is done for them, oil changes, etc. If something goes wrong with the car they don't have to worry about it, it's all on the dealer. I guess there is something to be said about that, but they pay for that peace of mind too.

 

BigV, you're not quite correct.

 

SOME manufacturers offer "maintenance included" but it's basic maintenance. The person driving the car is STILL responsible for anything that goes wrong with the car if it's not covered by the warranty.

 

If you plan on owning your truck for 5 to 10 years leasing is NOT for you. Most people do NOT hold onto their vehicles that long.

 

Too many dealers do not lease because they do not understand it (like many on here ). It's a better model than what they have now in most stores ie burying a person in a 66 to 72 month loan knowing they'll be back in 3 years but are going to be so far upside down than they can't buy the car they want next time. So they stick them in a lesser car and the cycle repeats itself.

 

I'd challenge any and all dealers who say they are not in a "leasing market." All markets are leasing markets if dealers truly understand it.

I have never leased either. However the falacy in treating a car as an investment is that it loses money. So if you bought stocks that trended in value as cars, then you would go broke. Say you buy a 20,000 dollar car, financed it for 5 years, so paying roughly 25,000, with interest, kept it for 5 more years free and clear, what's it worth at 10 years old and 200,000 miles. Not much. So lease the same sort of vehiclefor 10 years ( that may be three leases, how much have you paid? Probably about the same. I came up with 24,000 for Leasing over 10 years. Sounds like a wash to me, except you do own the 10 year old 200,000 mile vehicle at the end. The one thing I have not hit on is taxes. Do you pay propery tax on leased vehicles like you do bought ones? If so, leasing is looking less attractive.

 

20,000 for 5 years comes to $417/month when adding interest. You are assuming that the lease payment will be almost $200 less/month, and you don't have to put any money down. Is that usual? I'm asking b/c I have no clue.

I have never leased either. However the falacy in treating a car as an investment is that it loses money. So if you bought stocks that trended in value as cars, then you would go broke. Say you buy a 20,000 dollar car, financed it for 5 years, so paying roughly 25,000, with interest, kept it for 5 more years free and clear, what's it worth at 10 years old and 200,000 miles. Not much. So lease the same sort of vehiclefor 10 years ( that may be three leases, how much have you paid? Probably about the same. I came up with 24,000 for Leasing over 10 years. Sounds like a wash to me, except you do own the 10 year old 200,000 mile vehicle at the end. The one thing I have not hit on is taxes. Do you pay propery tax on leased vehicles like you do bought ones? If so, leasing is looking less attractive.

 

I usually buy a well maintained vehicle about a year old with 10,000 miles on it and finance over 3 years if I have to. I put a lot of miles on cars and with 4, soon to be 5, drivers in the family it's worked out pretty well. We always get rid of the one in the worst condition, not neccessarily the one with the most miles, and then just step down vehicles so the least experienced driver has the least amount of damage he can do. My cars are definetly not an investment, only a tool.

BigV, you're not quite correct.

 

SOME manufacturers offer "maintenance included" but it's basic maintenance. The person driving the car is STILL responsible for anything that goes wrong with the car if it's not covered by the warranty.

 

If you plan on owning your truck for 5 to 10 years leasing is NOT for you. Most people do NOT hold onto their vehicles that long.

 

Too many dealers do not lease because they do not understand it (like many on here ). It's a better model than what they have now in most stores ie burying a person in a 66 to 72 month loan knowing they'll be back in 3 years but are going to be so far upside down than they can't buy the car they want next time. So they stick them in a lesser car and the cycle repeats itself.

 

I'd challenge any and all dealers who say they are not in a "leasing market." All markets are leasing markets if dealers truly understand it.

 

As you can tell from my post it has been a LONG time since I leased, but I thought all mainteance and service work was included in all leases. I could be wrong, frequently am and guess there are many different lease agreements out there, but I would hate to lease a vehicle and turn around and also have to pay to have something fixed if it went wrong or broke. I know in my lease they changed oil and did basic maintenance and if something happend to the vehicle (motor blew, transmission went out, etc) they were the ones who were responsible for fixing it as long as I didn't do something out of the ordinary to contribute to it. Nothing like that happened though so I didn't have to test it.

As you can tell from my post it has been a LONG time since I leased, but I thought all mainteance and service work was included in all leases. I could be wrong, frequently am and guess there are many different lease agreements out there, but I would hate to lease a vehicle and turn around and also have to pay to have something fixed if it went wrong or broke. I know in my lease they changed oil and did basic maintenance and if something happend to the vehicle (motor blew, transmission went out, etc) they were the ones who were responsible for fixing it as long as I didn't do something out of the ordinary to contribute to it. Nothing like that happened though so I didn't have to test it.

 

Again, you may get some basic maint covered (oil change, rotation, 10k maint) but you will not get true repairs covered unless the warranty covers it. The good thing about leasing, though, is that often your mileage is under the limit for the warranty so a lot is covered.

20,000 for 5 years comes to $417/month when adding interest. You are assuming that the lease payment will be almost $200 less/month, and you don't have to put any money down. Is that usual? I'm asking b/c I have no clue.

 

Yes. There 20,000 dollar cars that at times you can lease for 199.00. There may be a down payment on some of those leases. Making it a different deal

The other thing to consider is insurance. You will always have full coverage on a leased vehicle. Not so on a bought one.

The other thing to consider is insurance. You will always have full coverage on a leased vehicle. Not so on a bought one.

 

Only true for a small % of people if it's a used car and a miniscule % of people who buy a new car.

Only true for a small % of people if it's a used car and a miniscule % of people who buy a new car.

 

% goes up for people who payoff the car. I have 4 paid off cars in my stable, I pay full on only two of them.

% goes up for people who payoff the car. I have 4 paid off cars in my stable, I pay full on only two of them.

 

If you plan on having your car for 5 to 7 years it's highly unlikely you're going to carry liability only after 3 or 4 years. You still want to protect your asset that you plan on having for a few years.

If you plan on having your car for 5 to 7 years it's highly unlikely you're going to carry liability only after 3 or 4 years. You still want to protect your asset that you plan on having for a few years.

 

All depends on what the car is worth. Even if its a good vehicle it may not be worth insuring. Thats why two of mine are covered, and the two beaters are not. Except for the 09, the others are 04, 04 and 05. 05 is covered because it still books for a decent amount. the 04's do not, however they are decent enough cars to keep.

The point is that there could be an extra cost in leasing as you will always HAVE to fully insure those vehicles.

All depends on what the car is worth. Even if its a good vehicle it may not be worth insuring. Thats why two of mine are covered, and the two beaters are not. Except for the 09, the others are 04, 04 and 05. 05 is covered because it still books for a decent amount. the 04's do not, however they are decent enough cars to keep.

 

 

I get that. I have some cars that have liability only.

 

For this thread though we're talking new cars.