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Does anyone here prefer a car lease to a loan?

post #1 of 17
Thread Starter 
I know this is so off topic, but DH and I are thinking of trading in his 04 Acura sedan after he gets done with his masters b/c the payments are really high. We still owe some on the car, and will probably get around 5-6k for it (after the debt is taken out). With only around $5k to put down, we have a choice of whether to buy something less expensive or to lease something less expensive. We are thinking of leasing using the logic that the lease payment would be less on a camparable car to a loan payment on the same vehicle.

I have never leased a car, only owned. My car payment is really low b/c I had a good trade in and I drive a Honda Civic. I have only put 5,000 miles on it in almost a year b/c I work 2 miles from home. The only things I know about a lease is that you shouldn't do it if you drive a whole lot (I don't). If my DH had a job farther away than mine, he could have my car and I could drive the lease.

Does anyone have any experience with leasing? I could use all the feedback I can get!
post #2 of 17
I wouldn't lease. I mean why pay all that money and never own it. But that is just my personal opinion.
post #3 of 17
I have worked in an auto-related industry, and I would never, EVER lease a car. It just doesn't make sense over time, you spend more than you would to own, and then you don't have the car to show for it after the lease is up.

If you have lots and lots of money and don't care too much about what you spend, then go for it, but otherwise, I'd say get a loan and buy.
post #4 of 17
I would definitely buy! I don't know about your side of the world, but when you lease a car here, they want it back in mint condition or charge you an arm and a leg to fix it!

Buying is definitely better (IMO) as you will have something at the end of it to put towards a new car when you decide to upgrade!
post #5 of 17
I would buy, there are no real 'perks' to leasing except the lease payment is slightly less than buying because they get it back and can sell it at the end. Plus by the time they add the extras like milage etc to the lease it is often not cheaper and you end up with nothing to show for it.

It is also alot easier to sell a car and pay off the loan you have for it than to get out of a lease early if you decide that it is not the vehicle for you
post #6 of 17
Being in the insurance industry you may want to buy. Most leases require that you carry high limits of liability insurance that could eat up the savings that you have with your payments.
post #7 of 17
I worked for Oldsmobile for 11 years. Great cars, but I will never lease........
post #8 of 17
Thread Starter 
Wow, thanks! I was warry of leasing b/c I don't like not having equity in something like that.
post #9 of 17
I agree with the others - I'd never lease either!

There are so many 'hidden' costs - some of them only allow you to put on so many miles, and if you get in an accident, they charge you more, and it has to be in MINT condition, or they can charge you more for that too.... its insane!

I'd definately buy -there are definately more perks to buying, for sure!
post #10 of 17
I have alway's leased I have never had a problem with it, Down payment is less, the payments are less and I can get a new one every 4 years, they are not that pickey about the small scratches and stuff, I don't drive that far in a year 12,000 is plenty for me. My first Hubby was in the car business for 20 years as is my son-in-law with Toyota for 11 years same dealer. I will be trading mine in come Feb next year for a Camry, the down payme is the same and the payments pretty much the same as 4 years ago The down payment to buy would be about $5,000 at least to keep payments where there reasonible, and the payments would be about $420.00 as opposed to a lease at $500 dn and $280.00 a month for the same amount of time. The leases aren't what they used to be anymore.I never cared who's name was on it as owner.. It works for me
post #11 of 17
I personally prefer buying. The only way would lease is if it was going to be a "company car" and I could use it as a tax write off.
post #12 of 17
Originally Posted by emily_325 View Post
I personally prefer buying. The only way would lease is if it was going to be a "company car" and I could use it as a tax write off.
That is the only reason we lease
post #13 of 17's totally different in the rest of the its common to lease. I guess because of it being the motor city, we like to "show off" the newer vehicles
Number one you get a brand new vehicle every 2-3 years...and my payments have never been over $250/mo. The down payments haven't been horrible. I'm currently leasing my Honda and I paid about $300 down and $235/mo for 3 years 15K miles. I also have the contract to buy my vehicle for $9K at the end of the lease.

Which, that is the downside, if you drive alot then don't lease. It can be constricting. Also, its easy to get trapped in the leasing process. I know I was thinking about buying a 2 year old car before I got my last lease, but this deal was WAY too good to pass up.
post #14 of 17
Thread Starter 
Pontiac has a similar leasing (with option to buy) program where you have a contract gauranteing a purchase price (or payment terms).

The pros for me:
-we are looking at a sporty little roadster, not something that will stand the test of time (we have my Honda for that).
-we don't drive a lot, both of us work within 4 miles of home.
-we live in South Florida where it is usually sunny convertable weather.
-we don't have a lot of monthly income to spend on payments (which is why we are trading in the hubby's car in the first place).

The Cons:
-you don't own it.
-the title is not in your name so the insurance is higher.
-you have to pay off any damages to the car when you turn it in.
-you have no equity in it so you have nothing to show for all the payments.

Still thinking about it, b/c the scales are pretty close here.
post #15 of 17
Originally Posted by Phenomsmom View Post
I wouldn't lease. I mean why pay all that money and never own it. But that is just my personal opinion.
For me I know I can just go get a new one 4 yrs down the line no strings attached same deal on the next one, I don't care if I own it, like I said it works for me,
post #16 of 17
Our Insurance never went up, Most of the time the small damages aren't even worried about, never had to pay for anything like that.
I kinda feel why worry about equity when I can go get another one brand new, Never had a minutes trouble leasing, I have leased 3 A Toyota corolla and 2 Camry's, can't wait to get that new one now
post #17 of 17
I worked in the auto finance industry for 20 yrs and I know leasing forwards and backwards!!!
That being said I personally would never lease a vehicle.
Why??? Well if you always want auto pymts and never own a vehicle outright-then lease.
Auto manufacturer's are getting much more fussy about the condition of the vehicle at the end of the lease so if you have any "dings" or inside damage-they will be your responsibility unless you buy the option that the dealers sell that will "cover" that kind of damage.
If you do not drive many miles you can get a bit better payment but if you go over miles its going to be at least 15-20 cents/mile.
Dealers can markup the vehicle price on a leased vehicle ALOT!!! What you need to know is the Gross Capitalized Cost-that is the price they are starting at-is it the same as if you would buy the vehicle. Dealers love lease customers as they make more money on leased vehicles.
Insurance - many auto mfgs have dropped the limits of liability requirement but the vehicle does need to have full coverage on the entire lease-it can be repossesed if insurance is not maintained.
If you do lease -lease for the shortest time period possible no longer than 36 months-why??? The longer the term us the payments will be lower but the industry average is for a customer to buy/lease a vehicle every 37 months.
If you want to terminate the lease early you have to pay the remaining payments-and I know there are 48 or even longer lease terms. When ones does the math comparing a lease to a buy-there is no advantage to leasing.
I don't care what the finance mgrs at the dealer tell you-they want to sell a car-I have had to deal with the ppwk problems.
Also I am trying to remember the taxing laws in FL-I know you have a battery tax, and some other small taxes that will have to be paid-Most states also have a monthly rental receipts tax so if you are getting a payment quote for a lease find out if the tax is included or not-depending on the price of the vehicle it can make at least a $20-$40 difference in the payment.
If you have more questions feel free to ask-I know the secrets the finance mgrs at the dealerships don't wnat people to know!!!
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