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Thread: Does anyone lease their cars?

  1. #1
    Ascendant OMFG I Post Too Much
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    Default Does anyone lease their cars?

    Would you recommend it?

    Had a 2009 cobalt
    I make decent money these days and have a 2012 Malibu but been having a strong feeling that 8 want to get something more sporty like a Camaro

    Given how I've had my current car about a year and half and wanting something else I'm considering leasing this time around

    Anyone been down this road?

  2. #2
    Ascendant Ashenhand
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    I have not... but I believe generally leasing can be good if you:
    1) Plan on getting a new every couple of years
    2) Typically don't keep your cars for very long after they've been paid off

    Make sure to watch out for annual mileage stuff in the lease agreement. Have an as accurate as possible history of how many miles you typically drive each month/year. This will greatly help when deciding if you need to purchase additional miles on your lease.

    Otherwise I've heard leasing can be good if you fit into the categories above. Repairs are covered I "think" because it's not your car, but I'm not positive.

    FYI I drove a 2009 Dodge Challenger R/T 6-speed manual from Oct 2008 to Sept 2013. Sporty can be fun... but I got tired of sporty well before 2013. I traded in for a 2014 Ford Fusion Hybrid Titanium.

    So personal opinion, leasing a sporty car could be a good thing, because you'd have it for a limited time and possibly live through your sporty phase, and then be in a good position to buy a less sporty car at the end of the lease.

    Also keep in mind that at the end of the lease, you don't have any money in the car. So if you don't do another lease or buy the car for a reduced price, you're left on foot with no cash in hand typically. So it's more like an extended car rental. If you like driving new cars every few years it's good because you don't have to deal as much with sales tax on buying a car, don't have to deal with a lot of loan stuff etc... but at the end of the day, you don't really own anything if you know what I mean.

  3. #3
    Iksar Admin OMFG I Post Too Much Nedrom's Avatar
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    I lease my car. It makes no sense to pay more for a loaned car, at all. Unless you have the cash to buy it outright.


  4. #4
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    Quote Originally Posted by Nedrom View Post
    I lease my car. It makes no sense to pay more for a loaned car, at all. Unless you have the cash to buy it outright.
    I'd say that varies largely on the quality of the car, the deal you can get on a loaned car, how much your use would depreciate its value, and how long you plan on holding onto the car.

    I bought an Acura TL in 2011 with .9% APR. Even if I took the entire 5 years of the loan to pay off, it would only have amounted to a little over $900 in total interest. I'm almost paid off now and I will have a car with great resale value when I am ready to sell/trade in (probably a few years down the road at least). I can guarantee if I take the money I would have been paying in a lease for a comparable car from the point I bought to the point I plan on selling, it would be a larger sum than the amount I end up paying on my car once I recoup some money from a sale.

    Right now a lease on a TL is $350/month + $2k down at signing. At a standard 36-month lease, that comes in at $14.5k and the Kelly Blue Book value on my car is $27k so even right now it will be extremely close to breaking even when I pay off my car early next year (which coincidentally will be the 3 year mark from when I bought the car). Holding onto my car for another year or two from that point will work in my favor when compared to the money I would have spent continuing to lease.
    It's not a lie. It's a gift for fiction.

  5. #5
    Ascendant Ashenhand
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    Quote Originally Posted by Nedrom View Post
    I lease my car. It makes no sense to pay more for a loaned car, at all. Unless you have the cash to buy it outright.
    Not sure what you mean by "pay more for a loaned car". Non-lease car buying isn't paying for a "loaned" car.

  6. #6
    Ascendant OMFG I Post Too Much
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    how does insurance work for a leased car?

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    Iksar Admin OMFG I Post Too Much Nedrom's Avatar
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    Quote Originally Posted by ryum View Post
    how does insurance work for a leased car?
    In Canada, there is no difference how you own your car when it comes to insurance. For any of the companies I've used anyway. Even when I shopped around 6-7 different companies when I recently moved, none of them cared it was leased etc..


  8. #8
    Iksar Admin OMFG I Post Too Much Nedrom's Avatar
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    Quote Originally Posted by Phistikuffs View Post
    I'd say that varies largely on the quality of the car, the deal you can get on a loaned car, how much your use would depreciate its value, and how long you plan on holding onto the car.

    I bought an Acura TL in 2011 with .9% APR. Even if I took the entire 5 years of the loan to pay off, it would only have amounted to a little over $900 in total interest. I'm almost paid off now and I will have a car with great resale value when I am ready to sell/trade in (probably a few years down the road at least). I can guarantee if I take the money I would have been paying in a lease for a comparable car from the point I bought to the point I plan on selling, it would be a larger sum than the amount I end up paying on my car once I recoup some money from a sale.

    Right now a lease on a TL is $350/month + $2k down at signing. At a standard 36-month lease, that comes in at $14.5k and the Kelly Blue Book value on my car is $27k so even right now it will be extremely close to breaking even when I pay off my car early next year (which coincidentally will be the 3 year mark from when I bought the car). Holding onto my car for another year or two from that point will work in my favor when compared to the money I would have spent continuing to lease.
    I got a 2013 VW Jetta. The loan option instead of lease was twice the monthly cost. It's just not economical. I have no need to own a car, that's just my personal preference. I like the idea of being able to trade up at the 3 or 4 yr mark.


  9. #9
    Ascendant Ashenhand
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    A loan is more expensive because you're actually "buying" ownership of the car over time.

    A lease is cheaper because you're only "renting" the car. When the lease is up, you don't owe anything (assuming the car has less than the end of lease mileage), but you also don't own anything either.

    Both have their good points and bad points.

    Here's some good info to read:
    http://www.edmunds.com/car-loan/leas...fferences.html

  10. #10
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    Quote Originally Posted by ryum View Post
    how does insurance work for a leased car?
    At least in PA, insurance on a leased car or a car you have with a loan against it is the same. You must carry full insurance on the car. You can only go with lesser insurance once you own the car.
    It's not a lie. It's a gift for fiction.

  11. #11
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    Quote Originally Posted by Nedrom View Post
    I got a 2013 VW Jetta. The loan option instead of lease was twice the monthly cost. It's just not economical. I have no need to own a car, that's just my personal preference. I like the idea of being able to trade up at the 3 or 4 yr mark.
    Saying it's your personal preference not to own and it makes no sense to own are two drastically different statements. Going back to my loan on the TL, my contracted monthly payment is $650/month so considering a lease is $350/month, it's not far off from twice the monthly cost you mention for your Jetta. It will still be a huge benefit for me when I am ready to trade in and get a new car.
    It's not a lie. It's a gift for fiction.

  12. #12
    Ascendant Ashenhand
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    Personally I'm against leasing. I wouldn't do it myself, but that's just me.
    You can compare it to buying vs renting a house.

    Let's say Bob buy's a house with no money down and pays $1,500 per month.
    Let's say Mike rents a house and also pays $1,500 per month. What kind of house is Mike renting for $1,500 per month? Probably something much nicer than what Bob is living in... similar to leasing a buy, rental prices tend to be less than loan payments.

    So both Bob and Mike are paying $180,000 per year.
    In 30 years, they'll both have paid $540,000.
    What does Bob have to show for all of his money? He owns his house.
    What does Mike have to show for all of his money? Nothing. He still owns nothing. Sure he's lived in a really fancy place for 30 years, but he has no equity in the place.

    Same thing applies to leasing vs buying a car.
    Lease prices tended to be less than loan payments.
    If you buy a new car and your car payments are $500 per month... how does that compare against lease payments of $500 per month? A lease payment of $500 per month will generally get you a much fancier car than you could possibly buy with just $500 per month loan payments.
    But again, you are not building any equity at all in the car.

    But it works for some people. I'm not saying it's wrong for everyone. I'm just saying I don't do it.

    Leasing a car can let you drive something fancier than what you could normally afford via buying. But never forget that you aren't building equity. For me that's the most important difference between leasing and buying... equity.

    Edit: Also a bit more along the equity line... equity is power. It's ownership. It's property. When you go to buy a new car and trade in your old car, you only pay sales tax on the difference. If your new car costs $30,000 and you trade in your old car for $10,000 you only pay sales tax on $20,000 rather than the full $30,000. Sales tax on $10,000 is nothing to sneeze at...

  13. #13
    Ascendant Ashenhand Abner Thunderheart's Avatar
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    I have seen several people regret leasing. Getting hosed at the end of the lease because of mileage or minor damage and having little to show for it if not owing even more. I will never lease.

  14. #14
    Ascendant OMFG I Post Too Much
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    I'm just going to keep the same car and revisit the issue in January.I do appreciate all the info and personal takes on the matter

  15. #15
    Ascendant Transcendent
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    Don't lease unless you can write it off as a business expense, type S corp, etc, in USA. I have no idea where these other folks are getting their info from...it's a bad deal if you cannot write it off. Also check with your lawyer or tax attorney if you have questions about this. If you don't have one you should hire one.

  16. #16
    Iksar Admin OMFG I Post Too Much Nedrom's Avatar
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    Equity is irrelevant for cars.

    Just my 2c.


  17. #17
    Ascendant Stone Fist
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    I normally keep cars till they don't move no more hehe. Recently bought a new one for the first time, I had about a 5k down payment and ended up with 163$ a month payments which lease with no down payment was like 199. Car dealer ships around here would give you 0% interest if paid within 60 months I should have mine paid off in about a year or so . I don't really like keeping any debt.

    Lease agreements look alot like warranty agreements, both with lots of little things in them to screw you over with I have always had bad experiances with that sort of things.
    Ghost of Xarrais

  18. #18
    Ascendant Ashenhand
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    Personally, when it comes to cars the best route is finding a the best deal on a car you can buy outright with about 6mo+ savings (or more if you can afford it).

    This is not the easiest option but I got my 2009 VW Rabbit with 80k miles for ~$6k. I own it, no payments. This took about 6 months of savings for me.

    IMO, leasing is the lazy way out. Super convenient, super stress free, but its throwing away your money. If you always lease, you will basically have a mortgage in the form of a car - you will ALWAYS have payments. Consider leasing only if you are paying into the car and can purchase it much cheaper at the end of the lease.

    my 2cp.

  19. #19
    Iksar Admin OMFG I Post Too Much Nedrom's Avatar
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    I don't see it as being lazy at all.

    I have a 3 yr lease on a 2012 vw jetta, payment is $300 / month. I get a new car after 3 yrs are up and I don't have to worry about fixing the car, everything is covered under warranty.

    If I had a loan for it, would be close to $500 / month for the same thing locked in for at least 5-6 years.

    I'll take the lower payment and easy opt out for a new car at the end of the term over buying one outright any day. That extra $200/month is a lot of money for some people.


  20. #20
    Ascendant OMFG I Post Too Much
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    in 2009 I tried the buying a new car outright for better savings and it doesn't really work for a new car... Nothing all that exciting anyways

    maybe it's changed since then though

  21. #21
    Apostle Master Xosa's Avatar
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    I buy. I'm not trying to sway... but I haven't had a car payment in 3 years. If you take care of your car and don't need to change cars every year, buying works. I bought first car for $2000, paid off and traded in 2 years later for $1000. Next car was $5000 minus $1000 trade in. Paid it off, got $2500 trade in. Next car was $10000 minus $2500 trade in. Got $5000 trade in for that, put towards current car, which was $21000, put additional $6000 cash down for a total finance if $10000, which was only about $175/monthly. We paid aggressively and had it paid off within a year. Boom. 1 year old decked out van, no payment. Had it now for 4 years. And I think it's still around $12000 trade in if I wanted a new one. It's a nice bargaining chip. Leasing will get you more car faster initially, but you never build any "equity". You will always have a car payment.
    The idea for me is to never have a car payment again. I trade in at roughly 5-7 years, take awesome care of it, get a hefty trade-in, and pay off rest in cash. And my cars are fairly new and always under warranty so I don't incur a lot of maintainance costs.

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