(Closed) NWR: Leasing a Car

posted 7 years ago in The Lounge
Post # 3
Member
352 posts
Helper bee
  • Wedding: March 2012 - Zama Beach Club, Isla Mujeres, Mexico

I have a honda accord and I love it! The only thing with leasing is that your insurance goes way up.

Also, with a honda, they hold their value so well that its worth it to buy the car.

For example, I have a 2008 honda accord coupe and I owe 11,000 on it… But its worth 19,000.

 

Post # 4
Member
352 posts
Helper bee
  • Wedding: March 2012 - Zama Beach Club, Isla Mujeres, Mexico

PS: I love your name!

Post # 5
Member
2496 posts
Buzzing bee
  • Wedding: January 1991

I’ve never been a fan of the idea of leasing a car.  It’s a great option for some, and can work quite well in many situations.  But, if all possible, I would rather take a loan out on a car to pay for it, rather than lease it and not have anything to show for all the money I put into leasing that car if I end up not liking the car and want to get a different one at the end of the lease.  Plus, I don’t like being limited on how many miles I could drive in a year. 

I would look into what a car loan would cost you, vs leasing before making a firm decision.

Post # 7
Member
374 posts
Helper bee
  • Wedding: January 2011

I leased a Volkswagon Beatle. I work in the insurance industry so I’m not sure what cost increase the PP is talking about, but I can tell you that leasing is great as long as you read your lease terms.  I only had to put down a minimal amount up front and any repairs that needed to be made to the car were done without charge to me.  The downside…when it was time to turn in my car they made me replace all the tires and I changed jobs in the middle so my commute to work was much longer for the length of the lease, meaning I put more miles on the car then I had intended.  With the extra 700 miles and new tires I ended up having to pay $1200 at the time of turn in.

Post # 8
Member
3871 posts
Honey bee
  • Wedding: November 1999

I agree with @piglet_625: I wouldn’t lease a car either. 

If you buy a car, when you are ready to get another you at least you have it’s trade in value to use towards your next car.

When you lease, you have essentially nothing at the end of it.  You have to scramble to buy or lease another car and find another down payment for your next car.

The only reason I find people lease cars is because they want a new car every 2 or 3 years.

Post # 9
Member
3148 posts
Sugar bee
  • Wedding: August 2012

I’ve always purchased, I’ve never leased.  I like having a goal and paying off the loan quicker.  It was nice to have a couple years without a car payment.  It was also nice to be able to sell a paid off car for cash.  The common leasing I’ve heard of is BMW’s, Mercedes, ect because it’s too expensive to purchase if you don’t have a hefty downpayment so leasing works for them,

Like the PP said, read through the leasing agreement very closely, you don’t want anything unexpected ($$$) in the terms and conditions.  Don’t let them rush you through reading it either.

Post # 10
Member
643 posts
Busy bee
  • Wedding: July 2011

I’ll give a pro-leasing perspective, but for the record I have never heard of or experienced in quotes from insurance companies that leasing means higher insurance as mentioned by a previous poster.

Let’s say you’re a single Mom, have nothing to put down on a vehicle and down the road no extra cash to maintain/fix a vehicle when out of warranty. A new vehicle is attractive and the thought of “having nothing to show for it” at the end is a non-factor. This was my Mom as I grew up. Payments are lower on a lease, if you know you’re going to stay under km’s, it’s an ideal situation.

Hubby and I both lease. I am just about to finish a 4-year Groomsmen lease, he is on his second 5 year Honda lease.

I leased because I first purchased a car from a dealer and it was a lemon, trying to get away from it (selling it) after financing all of it (recent grad with no money and new into a job) leasing gave me an opportunity to drive a new car kept my payments low. The dealership was able to offer me full amount owing on the lemon to pay the loan I had taken out on it, and I got into the lease with them. I got a low km lease (80 000 over 4 years) and have a great little car that does what I need. It’s a Pontiac G5 and to me, not a “lifer” car I would want to own after 4-5 years anyways. I bought it before the economic downturn and the buyout on it after the 4 years is now comparable to what one costs brand new, so in my opinion getting to hand it back and start fresh is a “win” for me.

Hubby moved across the country and had nothing to put down, low lease rates over purchase financing also were attractive to him (the first lease was pre me!). He drove 2 minutes to work every day, so would never have been an issue with going over his allotted km’s. About 6 monthhs prior to lease end, Honda contacted him to move him into a new civic (lease #1 and #2 are both Civics!) Financing or leasing were  both options for the 2nd one, but again with little to put down when you’re talking financing or leasing, leasing can/is more attractive because of the new vehicle factor after 3-5 years and if you have nothing to put down why does nothing to show for at the end factor in if we always have vehicles under warranty, free roadside, etc. If we’re always going to have payments why not lease and have the new factor? The return of the first lease taught us one lesson -never replace 2 tires, always 4. Lease returns wnt equality on all four -lucky for us, they excused this cost as we were going to purchase/lease another vehicle from them, but lesson learned.

Our next vehicle will be a purchase and a “lifer” vehicle, it will be an upgrade from our entry level Civic’s and G5’s, be more of family size and the vehicle we drive across country 1-3 times a year to see Hubby’s family, km’s will go onto this vehicle like crazy. We have $10K to put down on this one and that is a huge helper, but for earlier stages in our lives and knowing my Mom’s take on leasing, it is a wonderful option to have that can ease payment cost/financial burden on a monthly car payment.

Post # 11
Member
5921 posts
Bee Keeper
  • Wedding: December 2010

I leased a car prior to buying, and it was a terrible idea for me.  I went WAY over on the mileage…like….double… 😉 And it actually ended up being cheaper to pay off the car than the mileage.  That’s how I became a car owner!

Post # 12
Member
916 posts
Busy bee
  • Wedding: April 2011

As others have said, leasing can work a) if you don’t drive very much, and b) if you like to have a new car every few years.  The overage costs can be surprisingly high, and miles can add up fast! I almost leased a car in January (ended up buying), and I’m so glad I didn’t, since I ended up moving, and put on 7k miles in 7 months, which would put me on pace to go over the lease mileage.  

If you are someone who drives a car as long as it still runs, buying is definitely worth it. The money you are putting towards a lease every month becomes equity instead.  So instead of spending that much money for 3 years, and then having to return the car, you have a car that belongs to you instead.  My husband’s parents lease, but having a new, fancy car is important to them.  Since they would never be able to afford to buy those cars outright, they lease them. 

Post # 14
Member
1701 posts
Bumble bee
  • Wedding: October 2010

I am a former leaser.  However, I never put anything down (which will raise your monthly payment).  If you have 2500 to put down, buy a good used car.  As  PPs noted, you still have to pay for maintenance and repairs.  Plus, there is always a “
lease termination” fee at the end.  In 36 months, a purchased car would be close to paid for.

If you ultimately decide to lease, play around with this calculator first.  Negotiating the purchase price (just like if you were buying it), residual value and money factor (almost like an interest rate) could lower your payments by a significant amount.  Warning–the sales person will not want to reveal some of these numbers.  They often don’t even know the numbers.

http://www.edmunds.com/calculators/car-lease.html?sv

Post # 15
Member
4824 posts
Honey bee

http://www.money-zine.com/Calculators/Auto-Loan-Calculators/Buy-or-Lease-a-Car-Calculator/

This is a great calculator. Traditionally and statistically it normally costs more per month (averaged over the life of the car) to lease vs buy which is why most people don’t recommend it. 

HOWEVER it can make sense if you dont really care about the total cost (IE some people want to be able to trade it in for the newest and greatest), can guarantee you will not go over the miles (and even then it doesnt always guarantee a cheaper per month) such as a new job, extra driving due to appts, family, vacations, one car breaking and doubling the use of the leased car etc.

Post # 16
Member
2792 posts
Sugar bee
  • Wedding: May 2011

I leased my 2011 Camry. I’m not sure about Honda, but Toyota has a great incentive where there’s $0 down or due at signing, $15K miles a year, sales tax, title and registration are included, 2 years of free maintenance, and no return fee when you bring the car back. It really is the only gimmick-free lease.

I love the idea of leasing since I work from home and don’t drive a ton of miles a year. And every 3 years, I get a brand new car!

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