I've never leased one myself and won't after my parents had to pay a big penalty due to excessive miles on theirs. This of course was about 10 years ago so things (as stated by another post) could have really changed.

 

In my parents case, they live in a fairly large college city. Therefore don't have lots of traveling miles to do normal and routine things (grocery, out to eat, etc) but they were still over the required mileage and had to pay the penalty. They also owned another vehicle and used this one as their second vehicle as they are both retired.

 

In my case, I live in a rural county therefore having to travel great distances just to get to work, grocery etc and ofcourse then I do alot of traveling for work too. The new car I bought in late October already has just under 25,000 miles :cry: so . . . a lease is not an option for me!

 

So . . . you just have to assess your own situation and needs.

The way I see it, you keep leasing, trading in, leasing another one you never own it and never get it paid off. Therefore, in the end, buying it is cheaper!

We paid a lot more for the van. It is a limited...fully loaded...no options to get....including a power sliding glass sunroof...really neat for night drives to look at the stars....or, at the drive-in theater.

Anyway, the car is paid for and the van will be one day!! In the end, like I said, it will be a lot cheaper to purchase!

 

You must have missed the other posts where we said its not for everyone especially if you're a "buy and keep" buyer. However, the great majority of the buying public does not subscribe to that philosophy so now you have to determine what's best for those folks if they are not going to hold a car for 6 to 7 years.

It all comes down to a few things IMO.

1. You can buy a car, have a higher payment but in the end you own it. You don't have as much cash each month as you would if you lease it. People almost have to be crazy to buy a new car when you can get a much better deal on one that's been driven a little bit. You own the car in the end but it has also depreciated.

2. You can lease a car, have a lower payment and in the end you don't own it. The big thing is that you have a lot lower payment each month so now you have cash in hand that you didn't have before. It all comes down to what you do with that money. Do you invest it? Do you save it up to put money down on something else? Eveybody is different. It depends on what you do with your extra cash you are saving.

 

I have never leased but I do think there are ways to come out ahead by doing it if you are disciplined and have a plan. Going over your miles is something you HAVE to factor in too. If you are going to go over then I wouldn't lease.

 

Other than the very last point, I completely agree with your assessment.

 

The new car I bought in late October already has just under 25,000 miles :cry: so . . . a lease is not an option for me!

 

.

 

..and neither is trading it in before your loan is paid off unfortunately.

Opened up this thread from deep in the closet. In the process of purchasing a car and I have looked at leasing options. I know where woodsrider stands on leasing, but anyone else have any more experience since 2008 with leasing?

Opened up this thread from deep in the closet. In the process of purchasing a car and I have looked at leasing options. I know where woodsrider stands on leasing, but anyone else have any more experience since 2008 with leasing?

I've actually changed my mind a bit on leasing. I think you have to look at all aspects and see what makes sense for you. If you are going with a new car a lease isn't always a bad idea.

I've actually changed my mind a bit on leasing. I think you have to look at all aspects and see what makes sense for you. If you are going with a new car a lease isn't always a bad idea.

It is probably a lot more complicated than I am making it, but that is kind of what I was thinking.

 

So the residual value, that is what you can buy the vehicle for at the end of a lease? I have not calculated it down to the penny, but on some leases I assume it is close to being a wash if you decide to purchase at the end of the lease than buying it from the onset. I read the other day 1 in 5 people now lease.

My wife just leased a new Explorer. This is her 3rd lease. Just no what your getting into. Leasing is not for one to put a lot of money down. Understand what the mileage limitations are. With most factory warranties covering up to at least 60,000 miles why not ?

It is probably a lot more complicated than I am making it, but that is kind of what I was thinking.

 

So the residual value, that is what you can buy the vehicle for at the end of a lease? I have not calculated it down to the penny, but on some leases I assume it is close to being a wash if you decide to purchase at the end of the lease than buying it from the onset. I read the other day 1 in 5 people now lease.

 

Residual value equals future value of the vehicle at the end of lease. Vehicle can usually be bought for a $300-500 fee over residual value. IMO that defeats the purpose of a lease though. The reason the payment is cheaper on a lease is because you are only paying for what your using. The higher the residual the cheaper the payment.

Opened up this thread from deep in the closet. In the process of purchasing a car and I have looked at leasing options. I know where woodsrider stands on leasing, but anyone else have any more experience since 2008 with leasing?

 

Give us your info.

 

Are you trading in a car now? If so, is it paid off?

How many miles do you expect to drive the new car annually?

Do you see yourself getting another car to replace this one in 3 to 4 years?

Residual value equals future value of the vehicle at the end of lease. Vehicle can usually be bought for a $300-500 fee over residual value. IMO that defeats the purpose of a lease though. The reason the payment is cheaper on a lease is because you are only paying for what your using. The higher the residual the cheaper the payment.

 

Technically, Da Champ, residual value equals an "estimated" future value which is the game leasing companies have to play. They want a high residual value so the monthly payment is lower. However, if they overestimate the residual value then they lose money in 3 or 4 years when they take the car back. Ford had that issue years ago when they marketed the 24 month $249 lease. Two years later the market for the Taurus plunged and Ford took a financial hit.

Technically, Da Champ, residual value equals an "estimated" future value which is the game leasing companies have to play. They want a high residual value so the monthly payment is lower. However, if they overestimate the residual value then they lose money in 3 or 4 years when they take the car back. Ford had that issue years ago when they marketed the 24 month $249 lease. Two years later the market for the Taurus plunged and Ford took a financial hit.

 

If one does a closed end lease then the residual is guaranteed. An open end lease means the residual will be adjusted at the end of the term. Stay away from open end leases. Its a no win situation for the consumer. In 2008 the market was so crazy it took a lot of financial institutions out of leasing. Especially in used cars. I don't know of anyone leasing used cars now.

Give us your info.

 

Are you trading in a car now? If so, is it paid off?

How many miles do you expect to drive the new car annually?

Do you see yourself getting another car to replace this one in 3 to 4 years?

 

There's an old saying in the car business when it come to down payment or money down. That equals gross ! Miles are very important when leasing. Third question is a good one. Don't lease no longer than 4 years.

If one does a closed end lease then the residual is guaranteed. An open end lease means the residual will be adjusted at the end of the term. Stay away from open end leases. Its a no win situation for the consumer. In 2008 the market was so crazy it took a lot of financial institutions out of leasing. Especially in used cars. I don't know of anyone leasing used cars now.

 

You are correct from the consumer standpoint. I was just clarifying that the estimated value (residual) is not a guaranteed value other than when it comes to buying it at the end of the lease - which I would never do.

There's an old saying in the car business when it come to down payment or money down. That equals gross ! Miles are very important when leasing. Third question is a good one. Don't lease no longer than 4 years.

 

I asked about the trade because if he's upside down it could make it harder to get into an attractive lease.