Buy or Lease - what say you?

That’s cool if you can cut a check at the end. I’m glad it worked out well for ya! But if a person had to finance that buyout price that would be a horrible decision.

 

If you dont plan on putting on a lot of miles and want a low payment (maybe it just makes sense for your situation) a lease can make sense.

Obviously, in a perfect world, it is always best to just buy outright and pay cash but let's face it very few people are in that situation.

Most people rely on good old fashioned
credit.

Also, here is a possibility, low down, low payment, lease for 36 months. At the end get a vehicle loan to pay off the balance, lower rate, lower payments. Is that the best option? Probably not, but you work with what you have.

 

Any more horrible than financing a used truck with the same price tag as the residual?

 

I probably wrong like usual!! LoL!!

 

Just curious as to why you say that?
I plan on buying my wife’s car at the end of her lease. She will owe $17k
Do a 3 year loan on that and you have it paid off. Or I can buy it and sell it for $22k bc that should be blue book.
It’s bascially a 6 year loan with almost a 0%interest rate on the first 3 years
Am I missing something? Maybe I’m wrong?
It was my first lease but that’s how they explained it to me. I honestly should’ve done more research but she wanted a car and I didn’t argue
We also got it for $7k off the asking price so I couldn’t pass it up

 

Haha! I'm just asking because I don't know...

 

I have no clue either. I guess the old man in me just can’t get passed the concept of it. If it works out financially for a person go for it! Ive been a Toyota owner since 1982 just buy drive for 10 years and move on to the next one.

 

Aren't there still fees/valuation involved when you turn your vehicle back at the end of the lease? Damages could add fees to the end of the lease and then you are still stuck with a original quote that they will try to hold you to on top of the extra payments for damages?

Out of curiosity was your last leased vehicle a truck/suv/offroader?

 

No fees if you buy it at the end. If you turn it in they charge you
But it’s just like buying a used car.
It’s a Lexus SUV

 

ah gotcha that makes sense if you can negotiate a good rate. I'm still on the old fashioned thought that if you can't pay off a vehicle in 3 years you have no buisness buying it

 

If the money factor brings you to a low rate and then at the end of the lease and you can get a low financing rate at the end of the lease then this may make the most sense financially cause you can literally have a 9 year payment on the trucks as long as the effective rate makes sense.

 

I guess I just don’t keep cars for a long period of time. Ever since I started making money I got spoiled and get new stuff to often. I’m not rich don’t get me wrong but I just get tired of cars easily.
I’m keeping my truck for at least 5 years. But my wife is spoiled too and likes new stuff. I want her to keep this car for at least 5 years too but realistically after 3 I’m going to have a hard time convincing her to buy it and not trade it in.
Everyone is different tho. My parents do three year loans but they only buy cars every ten years
I just can’t keep something that long

 

Pretty much in the same boat. My wife’s parents growing up always had crappers that broke down so she’d rather have a new vehicle every 3 years that’s always under warranty. Never have to worry about a repair bill. Ever. We have bought them outright at the end of the lease twice and then sold private party for more. Use the extra for down payment on the next. She has a 2016 accord sport with a $212 a month lease payment. Put a thousand down. Residual in May is 14500. Should be able to sell for 16500 or so.
I historically haven’t kept cars long either. As long as I don’t lose anything more than the monthly payment I’m good with it. Just get bored easily I guess. This 36 month lease was a bit scary as that was a huge commitment. Haha. Had a 2016 Camaro 2ss before the taco, bought it for 28000 in February (winter, so it was way under book here) and got 28500 for trade in out of it. Paid $400 a month for the summer months to drive it. Can now say I’ve had a sweet sports car. Wasn’t practical or good for winter which is why it’s gone now. Leasing isn’t for everyone, but for lots of people it can work.
Yes, they charge a cleaning fee if you turn it in and don’t lease another vehicle with them. If you stay brand loyal you can get killer deals on the next one.

 

A lot of docs around here have their medical group or LLC as the actual leasing party. They make generous payments (pretax) and at the end buy the vehicle for a very low amount. This is an alternative to taking the mileage deduction when you drive a lot of miles for work.

One other factor not mentioned is that when you lease you only pay taxes on the lease payment itself, and it ends up being amortized over the length of the lease. When you buy you pay the tax on the entire purchase price up front. In Nebraska, the property tax for a vehicle purchase is about 8%, and the thought of writing a check for $2K or more is daunting (not to mention the downpayment). In contrast, I got my MX5 this summer as a lease and only paid $350 out of pocket with the first payment not due until the next month.

 

I just got home from the dealership leasing a new Tacoma. My 3rd leased vehicle. I like leasing because I get bored and want something different every couple years. Mileage only matters if you turn the truck in at the end. If you choose to buy it, or trade it in before lease end, there are no mileage fees or penaltys. As for modifying a leased vehicle, no dealership I've worked with cares. As long as your not hurting the value, and don't mind throwing money away if you choose not to buy it.

 

My girlfriend is leasing her Tacoma, and I bought mine. I pay about 200 more a month. Hers was new, mine was used. She's got an 2wd SR, I got a TRD sport. We will see at the end of her lease who comes out ahead. I bet she buys hers at the end of her lease. She loves that truck

 

Agreed! I only got a 5 year loan so that my payments are lower... with the plan to pay it off within the first year anyway. Screw interest.

 

Tying up a lot of money into a depreciating asset never makes sense. I leased my tacoma for nothing down and 340 a month. I’ll take that money I’m not paying down or monthly and invest to make more money. Lots of misinformed people in here that have probably never leased before. The Tacoma can lease very well with the high residual, as long as you can negotiate the selling price way down.

 

I bought mine. It listed for $36,850 and had A Nissan Fromtier as a trade in. After that was paid off I ended up with $10k down and nothing else out of pocket.....$435 a month for a 2017 TRD Off Road DBL CAB 4x4... I believe I made out on that deal.

 

I leased mine also. I switch cars every few years so eff it. I know it’s not the “best” financial decision but life is short.

My lease is $290 a month

On a $36k msrp truck. I can live with that