Leased Trucks?

No, they do not give you the equity. Leasing then buying is not a bad option for a Tacoma, but we are in a very unique situation because of the resale value. Its NOT a bad idea to lease then buy if you cant afford a regular payment.

I did the math when I got mine 2018. I ended up paying $34 out the door. If I would have leased and then bought the truck it would have cost me close to $40K

 

My lease quote was similar. Lots of variables though. Interest and taxes in lease payments, plus sales tax and APR when buying at lease end vs. APR and sales tax upfront when financing.

Just wanted to know when and why to care about equity in a lease. I have equity too and I financed. Only thing it does is offer me a cheaper way out for financial issues or something.

 

People care about equity for a couple reasons

If you decided to trade it in, its "worth" more money, especially to a non toyota dealer who will have to sell or auction the vehicle

Ive heard of people selling a leased vehicle to carmax because the payoff was much less than the actual value by a couple of thousand dollars

I sold a Subaru Forester a few years ago and made $2000 more than the buyout was at the end of the lease...

 

The truck buyout can sometimes be worth more than what's owed on a lease buyout. You can actually trade it in for a new truck and and use that equity as a downpayment. I did that with a honda pilot trade in lease. Dealer gave me 4grand for a lease. Best calling dealers before you go in, some won't do it. They like to keep the equity in house, they will buy those cars/trucks outright.

 

Ok thanks. Confirming what I thought. The equity is useful as a tool to move on from the current vehicle.

My brother leased a Tacoma recently so I was curious on what the best options will be. He will likely lease another afterward so seems its best to trade this one in early for another lease, probably within last few months of the current lease.

 

If you wanted to save all the money you save from the cheaper payment and put it down at lease end purchase price it’s pretty close. 34500 purchase price. 37500 with taxes and fees in my state. 72 month loan at 4% is 585. My lease is 355.
585-355=230x36=8280
27500 residual - 8280= 19220
If you financed up front after 3 years you’d owe 18800 after 3 years of paying. So $400 more to lease.
I’ll keep the small payments and more options.

 

Couple of things....

You will most likely have to pay sales tax on your residual and also pay end of lease fees. You need to add those dollars to your calculus.

In addition, your interest rate on a three year old used truck will be higher than the rate you would have received if you purchased three years earlier instead of leased (interest rates are rising, not falling).

Using your numbers it would be much more than $400 to lease.

To wit:

Pretend I bought your truck and you leased it. Lets compare some numbers...

I paid a total of $42,048 (72mo x 585)

You paid $12,780 to rent the truck for 36 months (36mo x 355) and then decide to buy it. Your residual plus sales tax plus end of lease fees will be $29,500 or so. You then have to finance that balance for say, four more years (makes the lease/buy term same as the straight buy term).

The rate will be higher on the now used three year old truck. Say 6% for 48 months on that $29,500. That equals a payment of
$692 x 48 or $33,200. Toss in the $12,780 you already paid for the privilege of renting the truck and your total is a tick under $46,000 or a difference of almost $4,000, not $400.

Assume the $692 payment is too big, then you have to take out a longer term...If so, the difference becomes even greater!

Huge edit:

If like you say, you have the incredible determination to actually "save" the $$ that is the difference between the lease and buy and put that down the numbers would be closer but still way more than $400.

In that case, you would be financing $21,220 and payments would be $498 x 48 or $23,900. Add that number to your lease payment total of $12,780 plus your down payment of $8280 means your truck cost you...$44,064.

A difference of almost $3000 not $400

 

Yeah maybe. But for me, there’s about a zero % chance I keep this truck long term. It’s fun for now, but it will go. If I want an actual off road vehicle I’ll get a wrangler, if I get a heavy duty truck, it will be a 2020 ram 2500 hemi with 8 speed. Different strokes different folks. For me, it won’t cost much more than the $400 or so. If you’re a vehicle keeper leasing isn’t the best option

 

I make bad decisions with vehicles. I currently have 4 vehicles and my wife has a Jeep.
07 avalanche. Bought it to flip it
2000 f350 for towing the camper and toys
2006 Acura rsx (commuter)
Wife’s 2018 grand Cherokee (leased, dumbass move I know)
Only payment I have is the Taco lease payment

 

Leasing is never the "best" financial option, makes no difference if you roll out of a vehicle in two, three or ?? years. Purchasing a Tacoma is always cheaper for anyone without an understanding of the Time Value of Money, Return on Investment or Business Depreciation. Those cats can take advantage of not putting $$ in a depreciating asset and instead grow more $$...Believe me, it is a beautiful thing when it works. BTDT

Think about it: The flexibility that leasing offers (which is absolutely true as you say) comes at a substantial financial cost. Most people don't care so I'm not sure why I'm writing a book here ;-)

BTW, nice Avalanche!

 

It’s for sale if you’re interested! Haha!

 

Leased my wife’s truck. First time we’ve ever leased.

Sticker price. 36,907.00
Negotiated price 32,991.80
Buy out at end 26,586.00

39 months at 303.00 a month. No money down.
18,000 miles a year.

I think we did ok.

 

I leased my 17' SR5, 3/36 for 0 down $320 (including tax). A lot of people hate on leasing, but it's fit my needs well in the past. I just traded in an Altima SR that was at the end of the lease (got buyout on trade toward Camry XSE), but i drove that car for $210 0 down; thats really cheap to drive a fairly nice new car.

The nice thing about leasing is, as someone mentioned, is if you wind up hating the vehicle, it's not hard to get rid of. Toyota offers 100% lease transfer and it's not hard to get someone to assume the lease if you got a good deal. Further, if the vehicle gets in a bad wreck, the bank takes the hit on residual, not you.

Its not the "best" financial decision for everyone, but it has its perks. I haven't decided whether i'm going to buy the Tacoma; i'm feeling the new RAM.

 

Haha this conversation again.

Heres your #'s....
39*303 = $11817 (assume you put $0 down)
+ residual = $38403 (total cost of ownership if you buyout at end of lease)

unless your TTL totaled 5k, would still be cheaper to buy.