Does car leasing make sense? Seeking car buying experts

[Huntn]

If you're replacing your car every 2 years then leasing does seem to make sense, provided you can live within the constraints of the lease agreement, e.g., mileage.

Agreed. Some companies offer lease to buy, but you have to look at the details to figure out if that would be a wash with an outright purchase, or maybe even a loss.

At one point in my life I was purchasing and trading in a car every 4-6 years for a new car. The trade in value seemed to make enough sense at the time, with a 3-4 year finance, to keep me in a fairly new car, while realizing that cost more than buying and holding the car for a long period of time. Then I could afford it, but now, my goal is to keep a car at least 10 years.

 

[Weaselboy]

Since most people are paying invoice for Q50's as truecar indicates, I think the MSRP number on the calculation should be reduced.

That's not how the lease calc. works. The MSRP is always shown up top there and the residual is calculated off the MSRP number. Where your invoice or good price comes in is in the cap cost below that.

I agree, I'd use the money as a cap cost reduction, hell I could probably even add another $1k of my own money to help further if it makes any financial sense. Can you send me a PM with a dropbox link to your spreadsheet? I'd like to have that for my personal research as well.@Weaselboy -

I noticed in the Subaru calcs it appears the tax situation for you is the same as California. So that is another argument against using a cap cost reduction, since it is taxed up front. It is treated as if your are "buying" that portion of the car so sales tax is applied.

PM link sent.

On another note, my place of employment, Subaru, offers what they call a "Special Lease Program".

Looks like the sale price is invoice, so yeah.... that is a good deal. Residual and MF (.00025*2400=.6% interest) is really good. He does not say what the annual mileage is though?

I would pass on the maintenance plan and just pay for oil changes myself, but that's just me. No idea what "Driver Care Protection" is? These both smell like dealer profit add ons to me.

This is extremely interesting.....thoughts @weaselboy?

Just from what I have read about it, good deals can be had. This is an example of where you could take advantage of a low payment because somebody did make a large cap cost reduction payment.

I guess mentally I would have a hard time paying close to new car lease payments for what is essentially now a used car that someone else has already farted in the seats.

 

[maflynn]

Agreed. Some companies offer lease to buy, but you have to look at the details to figure out if that would be a wash with an outright purchase, or maybe even a loss.

At one point in my life I was purchasing and trading in a car every 4-6 years for a new car. The trade in value seemed to make enough sense at the time, with a 3-4 year finance, to keep me in a fairly new car, while realizing that cost more than buying and holding the car for a long period of time. Then I could afford it, but now, my goal is to keep a car at least 10 years.

I'm quasi tempted to trade in my wife's car. With all the snow and storms recently, business at dealerships is non-existent. Around here in the Boston area (I'm not sure if this country-wide) President's day is a huge day for car dealerships. They push hard with discounts, incentives and rebates. Since we've been snowed under, getting a storm each week, that hasn't happened.

We'd go the lease route for her, but even so, the car so new though its not worth it quite yet. Maybe next year.

 

[FieldingMellish]

These conditions do sound ripe for scoring a deal. If not on the part of the dealer, then on the part of manufacturers who want to move product.

I am still driving my 14 year old Toyota 4Runner; runs fine. Tech is absent, but it was the plan I made after having done several leases and giving back an under-mileage cherry vehicle that I hadn’t been taking full advantage of. And there was never a money return for not having used up the allotted miles.

 

[rdowns]

These conditions do sound ripe for scoring a deal. If not on the part of the dealer, then on the part of manufacturers who want to move product.

I am still driving my 14 year old Toyota 4Runner; runs fine. Tech is absent, but it was the plan I made after having done several leases and giving back an under-mileage cherry vehicle that I hadn’t been taking full advantage of. And there was never a money return for not having used up the allotted miles.

For my last 2 leases, Acura has let me roll over my unused mileage on my next lease.

 

[FieldingMellish]

For my last 2 leases, Acura has let me roll over my unused mileage on my next lease.

That is great for peace of mind. And better if you actually drive more and utilize what's rolled forward. As opposed to being perpetually behind and what that implies.

 

[Weaselboy]

For my last 2 leases, Acura has let me roll over my unused mileage on my next lease.

That is a nice incentive. I'm surprised more don't do that to encourage brand loyalty.

 

[rdowns]

That is great for peace of mind. And better if you actually drive more and utilize what's rolled forward. As opposed to being perpetually behind and what that implies.

Didn't do me much good on my last lease as I was working from home 2-3 days a week. Will use it this go round as I rarely work from home and have a slightly longer commute.

That is a nice incentive. I'm surprised more don't do that to encourage brand loyalty.

Acura is great about incentives for brand loyalty. Never paid a dime for any dings or scratches and they've given me a $1,000 certificate for my last 3 leases. However, my brand loyalty comes from their great cars and a dealer that treats me right.

 

[mr99]

Exactly.



https://www.truecar.com/

I used a couple 45-46k Q50 examples on Truecar and it looks like people are paying right at invoice for those, including incentives etc.

I am the proud new owner of a Q50 Sport. This is a breakdown of the deal I signed.

I purchased one MSD to buy down the money factor @ $500. I also requested a check for my trade in vehicle's equity, that will come in a couple weeks. ~$1500 + the MSD is returnable so I will retain $2k after all is said and done in the event I choose to purchased my next vehicle, I won't need to finance 100%.

 

[Weaselboy]

I am the proud new owner of a Q50 Sport. This is a breakdown of the deal I signed.

I purchased one MSD to buy down the money factor @ $500. I also requested a check for my trade in vehicle's equity, that will come in a couple weeks. ~$1500 + the MSD is returnable so I will retain $2k after all is said and done in the event I choose to purchased my next vehicle, I won't need to finance 100%.

Looks like you made out really well. I still can't get over how much below invoice they are going there. That coupled with the very very low money factor really worked in your favor.

Congrats and enjoy your car.

 

[baypharm]

Lease payments come off the top of your taxes if you have a business. It's nice to always drive a new car and I typically look for a 12 month lease. The problem I run into is mileage. I tend to put more miles on than what I'm allowed and that gets expensive...

 

[MICHAELSD]

Should be a great car! In the future, definitely do question any additional fees. In the majority of cases if pressed about it, dealers will remove the acquisition fee.

 

[D.T.]

I am the proud new owner of a Q50 Sport. This is a breakdown of the deal I signed.

I purchased one MSD to buy down the money factor @ $500. I also requested a check for my trade in vehicle's equity, that will come in a couple weeks. ~$1500 + the MSD is returnable so I will retain $2k after all is said and done in the event I choose to purchased my next vehicle, I won't need to finance 100%.

Outstanding! Look forward to seeing the pictures in The Car Thread

Side note: you should probably send Weaselboy his fee for Lease Consultation Services ...

 

[puma1552]

Looks like a good deal, you did well. Only change I would make would be more MSDs and I'd have done a 36 month to avoid paying a year's registration for a car you'll turn in three months later.

Other than that, nice pick up.

 

[Weaselboy]

Side note: you should probably send Weaselboy his fee for Lease Consultation Services ...

Now you're talking!

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Looks like a good deal, you did well. Only change I would make would be more MSDs and I'd have done a 36 month to avoid paying a year's registration for a car you'll turn in three months later.

Other than that, nice pick up.

He can't do another MSD. The rate is so low now that another MSD would drop him below the .00001 rate floor set by Infiniti.

Yeah... good point on the 39 months. BMW does a lot of these also and the residual on 39 is higher than for 36, so it still makes it a good deal even with that lost registration money. I have no idea why they do this though.

 

[mr99]

Looks like a good deal, you did well. Only change I would make would be more MSDs and I'd have done a 36 month to avoid paying a year's registration for a car you'll turn in three months later.

Other than that, nice pick up.

I'll have registration fees every year regardless of what car I have so that last year i'll register this car and when I trade the lease in I'll just have to pay the delta increase in fees for whichever vehicle I get at that time. It's not lost money.

 

[Weaselboy]

I'll have registration fees every year regardless of what car I have so that last year i'll register this car and when I trade the lease in I'll just have to pay the delta increase in fees for whichever vehicle I get at that time. It's not lost money.

Much better than California. If I pay $350 for a full year and turn in the car in a month, that whole $350 is gone.

 

[mr99]

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Much better than California. If I pay $350 for a full year and turn in the car in a month, that whole $350 is gone.

Are you sure? For example this year I registered my Acura and paid around $200. When I go register the Q50, I'll pay whatever the difference is for the Q50, I'm hoping around ~$100. Assuming the Q50 is $300 ish. Excise tax might hurt.

 

[Weaselboy]

Are you sure? For example this year I registered my Acura and paid around $200. When I go register the Q50, I'll pay whatever the difference is for the Q50, I'm hoping around ~$100. Assuming the Q50 is $300 ish. Excise tax might hurt.

Oh I am positive (for California). I have been bitten by this many times.

You could literally buy and register a new car on Monday then sell it on Wednesday and all the sales tax and license registration fees are gone and you pay full boat on the next car. Again, this is in California.

 

[puma1552]

I'll have registration fees every year regardless of what car I have so that last year i'll register this car and when I trade the lease in I'll just have to pay the delta increase in fees for whichever vehicle I get at that time. It's not lost money.

If that's true for your state that's pretty nice.

Much better than California. If I pay $350 for a full year and turn in the car in a month, that whole $350 is gone.

Same. If I sell a car partway through the registration period, that money is gone and I'm on the hook for the full value of a year with my next new car I buy. It'd be nice if it was prorated, alas it is not in MN.