Leased my vehicle

I would like to get some advice from you guys. I leased my 18 TRD sport about two weeks ago now. Its for three years. I was wondering what would be best to do, obviously assuming I want to keep the truck, which I think I do.

Should I wait three years and then go finance it or do it earlier, hoping that the payment doesnt go higher. Any thoughts on this?

TIA

 

This is a general financial question, not a Tacoma specific question.
https://cars.usnews.com/cars-trucks/how-to-get-out-of-a-car-lease

 

Pretty sure you cannot end the lease early if you intend to buy it. I could be wrong though. They will bring you in when you reach your miles and try to tempt you with a new lease vehicle. When you go to that, make sure you empty out the truck and have it really clean/waxed all that, any little imperfections, fix. It’ll help you move over to a new vehicle if that’s what you want.

But you were likely given the pay off amount for the end of the lease when you did your paperwork. When you get close to 3 years, like a month or two out, go in to your bank, I would suggest a credit union because you can’t beat 2.2%, and secure financing for the end of the lease. At the end of the lease, bring in payment, usually a promise to pay once title is transferred to them.

 

You can buy out your lease early, typically the lessor will be able to give you a payoff value, similar to if you have a loan on it. Contact your lessor and they can tell you what you need to do to buy it out early. Make sure there is no prepayment penalty or clause, or if there is, make sure you're familiar with it. Then you can arrange financing and make it happen.

It's financially advantageous to you to start making loan payments before the end of your lease, in the long run, you'll pay quite a bit less.

 

I would keep the lease for 3 years. 3 years is a long time. Things can change and you may not want to keep your truck, you may want something new, if you end up crashing it and having a huge claim on it, it is way better to have that happen to a lease since you don't have to worry about owning a truck with a big claim. The only reason I would consider switching is if your lease rate is much higher than you finance rate you could get. If not, I really see no reason to do it at this point.

 

I agree with this. I am currently on a 39 month lease on a 2017 SR5 since December. I have negative equity rolled in from my previous lease (was 14,000 miles over) and still got my monthly payment where I wanted it. I'm in a much better commuting situation right now so mileage isn't a huge concern and I think of it as a long term rental. Will probably just start fresh and buy cheap certified pre-owned or finance something else. If I were you, would be more wise to just wait until you're nearing lease end. Keep driving it and make up your mind later, I'm sure a 39 month lease vs 60 month financing isn't that much different. You never know how your life will change, if you need to downsize downsize, upgrade, etc . Why not take 3 years to think about it, if you're already in it?

 

Thanks for the advice guys. I will definitely take some time to think about it and go from there.

 

From the offers Ive seen I would just stay in the lease agreement. Id need to know the specifics of your agreement to know for sure, but most seem to have a residual that is pretty close to going the loan route. The offer I saw in my area last month would end up costing about 1.5k more than going with a loan, assuming you took a loan at the end of the lease that would make the total payment term that same. My only advice though is, whatever you do, do not walk away from the lease at the end of the agreement. With this truck you would be walking away from positive equity, which could be money in your pocket if you took out a loan and then sold it (assuming you wanted something different).

 

We leased our truck in April this year when we got it. 36 month lease with no payments since my trade in covered the entire lease period and down payment. I plan on keeping the truck for a while (my trade in was a 2011 F150 that I had for 7 years). Wife is just going to start making a payment to our savings every payday so when it comes time at the end of the 36 months we can drop a cash payment for the residual amount. 0% interest loan as my wife likes to think of it. Most CU's and banks are at around 4% interest rates for most loans that are over 60 months now, what will it be like in 3 years from now?

 

That's a smart way of doing it!

 

Im in favor of leasing these trucks if it makes sense, but its not 0% loan. You still paid a rent charge, you just did it up front.

 

leased mine in july of 2015. So it ends next month. leased it fully knowing i wanted to buy it. it was just cheaper for me at that time to lease it than to buy it as far as monthly payments went. talked to a lady at the local dealership and she said there was no benefits to buying it out early (even a month) but it can be done. I too am about 14k over what the allowed mileage was/is but from my understanding you can avoid paying those fees if you decide to buy.

 

Correct. You pay no mileage fee if you buy. You could also sell it to another dealer and pay no fees as long as toyota gets their buyout value

 

yeah was planning on buying mine regardless. had some late payments due to unexpected expenses. anyone know if that will have an effect on the buy out?

 

I think what he meant was rather than getting a loan for the residual amount to buy the truck at lease end, they were going to put enough money aside each month in addition to making lease payments. That way they can make the buyout with cash, it's a 0% loan to yourself.

 

It won’t, I was in the hospital for an extended amount of time, had a couple of late payments, made no difference

 

I would never buy a leased vehicle because the payoff plus what’s been paid is always close to sticker if not more. What I would do is take it to carmax near the end of the lease and depending on your region and popularity plus resell which are all likely in your favor, you can actually make money if carmax decides to buy it. If the payoff is negotiable at the end of the lease, then negotiate a purchase price that would put you on top (coming under) what purchase price from the beggining would’ve been. You have to subtract what you’ve paid for the lease monthly up to that point, then you’ll know how much below the payoff you would be paying to get a good deal. Lease to buys are rarely ever good ideas.

 

Good to know.

 

If you don't put any money down the payment will be a lot higher to buy it rather than lease it

 

The lease and buyout are separate. You can put money down to bring the lease payment down but the buyout at the end is a set number, they gave you that number when you signed the lease papers