Buy or Lease?

[mtm87tx]

not at this moment but in messing around with my options for cars. i wanted to see everyone's opinions on leasing a car or buying it. most likely a 39 month lease with 10% down. what do yall think? lease a car or buy it!

think automatic, sporty cars that are safe and comfortable, and arent to to bad on gas

[markthenarc]

I to am thinking about a lease... Pay off the Mach, only D.D. 3 seasons and would drive the leased car for winters, and crappy weather.
Im thinking something more utilitarian...Like a pickup or something.
It would be cheaper to lease, but you have to watch the whole mileage issue.

[mtm87tx]

well the difference between a 12k and a 15k mile a year car isnt to to much. how long of a lease where you thinking? im trying to figure out whats better, a 39 month lease or paying for a car for 60 months

[Steeler]

Before you even consider a lease, sit down and carefully figure out how much mileage you going to put on the car. Alot of leases are very reasonable but once you start factoring in mileage surcharges it gets expensive. Research sites like Edmunds, they have alot of "leasing vs buying" tips and calculators to help decide.

[Ralph Greene]

Being a retired VP of a major financial services firm, I have looked at leasing VS buying for hundreds of clients before...and advised them which is best for their particular situation.

I can tell you that buying and getting the car paid for, and then driving it until it dies, is always the cheapest route. You can repair a car indefinately cheaper than suffering depreciation on newer cars.

However, there are two situations where I think leasing works well. One is when you just want a new car every 2-3 years and don't like the hassle of trading or selling it, and just figure the lease payments are about the same as depreciation, so why not just write the checks. The other situation is when you have the money to pay cash sitting available, but wish to keep it invested making market returns. So you just figure the money invested will make what the lease costs, and you still have the money.

I tend to buy my cars, and drive them a while. My wife likes a new car every 2-3 years. I have on occasion leased her car. Paid the 2 or 3 year lease up front getting usually a 5% discount for doing so, and went for the cheapest low milage deal they offer, and if we went over on miles, who cares, just settle up at the end.

This is where I differ with some of you. I always have the money to pay cash if i wish. So to me...for my wife's car, the idea is to always have the least money invested that I'm not making money on. To me the ideal deal, and it has been offered to me before, is to pick up the car, pay them nothing, and just settle up at the end, depending on miles. For me miles allowed in the lease mean nothing. I would rather pay as little as possible while using the car, and then settle at the end. So I go for the 10,000 miles/year deals for my wife even if we drive it 15,000 miles. But then, I always have the money to pay cash, just don't want to. (an advantage of being an old guy)

If the car didn't depreciate as much as expected, I might buy the car, then immediately resale it. But if I lease the car on a low subsidized deal, the residual buyout usually is not a good deal. it works one way or the other usually.

I think most lease for the wrong reasons. Most do it to drive a car they can't otherwise afford. And that costs you big time. If you can't afford the payments to buy it, you can't afford to lease it. Move down a few notches.

[rhite95]

Being a retired VP of a major financial services firm, I have looked at leasing VS buying for hundreds of clients before...and advised them which is best for their particular situation.

I can tell you that buying and getting the car paid for, and then driving it until it dies, is always the cheapest route. You can repair a car indefinately cheaper than suffering depreciation on newer cars.

However, there are two situations where I think leasing works well. One is when you just want a new car every 2-3 years and don't like the hassle of trading or selling it, and just figure the lease payments are about the same as depreciation, so why not just write the checks. The other situation is when you have the money to pay cash sitting available, but wish to keep it invested making market returns. So you just figure the money invested will make what the lease costs, and you still have the money.

I tend to buy my cars, and drive them a while. My wife likes a new car every 2-3 years. I have on occasion leased her car. Paid the 2 or 3 year lease up front getting usually a 5% discount for doing so, and went for the cheapest low milage deal they offer, and if we went over on miles, who cares, just settle up at the end.

This is where I differ with some of you. I always have the money to pay cash if i wish. So to me...for my wife's car, the idea is to always have the least money invested that I'm not making money on. To me the ideal deal, and it has been offered to me before, is to pick up the car, pay them nothing, and just settle up at the end, depending on miles. For me miles allowed in the lease mean nothing. I would rather pay as little as possible while using the car, and then settle at the end. So I go for the 10,000 miles/year deals for my wife even if we drive it 15,000 miles. But then, I always have the money to pay cash, just don't want to. (an advantage of being an old guy)

If the car didn't depreciate as much as expected, I might buy the car, then immediately resale it. But if I lease the car on a low subsidized deal, the residual buyout usually is not a good deal. it works one way or the other usually.

I think most lease for the wrong reasons. Most do it to drive a car they can't otherwise afford. And that costs you big time. If you can't afford the payments to buy it, you can't afford to lease it. Move down a few notches.
+1 :agree:

[mtm87tx]

I think most lease for the wrong reasons. Most do it to drive a car they can't otherwise afford. And that costs you big time. If you can't afford the payments to buy it, you can't afford to lease it. Move down a few notches.

i think you hit it on the head Ralph, thats what im looking at.

lets talk about it though, like lets say a 2006 Infiniti G35 coupe auto

MSRP: 37150 with 3000 down and no trade in.

Leasing would be 488 a month for 36 months and 15k miles a year

where buying is 1038 a month for 36 months and unlimited a year @6% interst

so at the end of your lease you have 17568+4500 due at signing into a 37k can and you throw them the keys, car should be worth about 24-25k. do you buy it?

then if you buy it for for 39ish with interest you can sell it and you are out about 14-15k, just about 5k the amount you payed for you lease. and there are no gaurentee's in 3 years it will be worth this, with a new body coming out and all

Ralph is there anything im missing? can you finance the remainder of a car after the lease period? so confusing lol

where is my best deal at? lease or buy

[CA Lightfoot]

...I think most lease for the wrong reasons. Most do it to drive a car they can't otherwise afford. And that costs you big time. If you can't afford the payments to buy it, you can't afford to lease it. Move down a few notches.
I agree with everything you say ESPECIALLY that last part. My brother-in-law can afford to pay cash for his 4 vehicles, but he leases all of them. Keeps them 3 years, hands them in, gets something new, no hassles.

In 28 years I've leased just one car. Hated making payments with no title at the end. Even though I usually drive less than 10k miles/year, for me buying is the only way to go.

[mtm87tx]

why is it bad to lease a car you cant afford? what goes wrong with it? i mean if im leasing a 50k car and paying 600 a month to do so vs 1000 a month to buy, why is that bad? i can always make my payments and i like to drive a new car every 2-3 years. please explain, im sure yall are right i am just wondering why

[Ralph Greene]

If you assume most nice cars depreciate about $15,000 in three years, then you are correct to pick a model that doesn't depreciate as much as most. That way you lease a nicer car than if you picked one that depreciates a lot. So a G 35 is probably a good pick for a lease.

But if your goal is to get ahead financially, and your income is not off the charts high, than spending $15,000 every 3 years for a car gets real expensive over a life time. There are many cars (our Mach's for example or my daughters Honda Accord EX) where I might drive them 10 years for no more depreciation than $15,000.

It's true you have to maintain okder cars, and things go wrong occasionally, but that probably won't add up to more than a couple thousand dollars over the 10 years. So intil you are financially secure, I think leasing is a very expensive way to own cars unless you have investments making a good return you don't wish to disturb (we call that opportunity cost) making a good return.

BTW insurance costs more also when leasing and on newer cars in general.

[mtm87tx]

well the car is 37k new and the 03's out right now go for 25k according to the books and alittle more in my area depending on options on autotrader. so it doesnt seem to be a bad deal, but i am sure that other car depressiate alot more than these

[machfelon]

You cant MODIFY a leased car either :)

[mtm87tx]

i think i will have to leave the next one alone

[FloridaOrange]

MSRP: 37150 with 3000 down and no trade in.

Leasing would be 488 a month for 36 months and 15k miles a year

where buying is 1038 a month for 36 months and unlimited a year @6% interst

so at the end of your lease you have 17568+4500 due at signing into a 37k can and you throw them the keys, car should be worth about 24-25k. do you buy it?


You also need to review the "sign-up" fee, which sometimes is a few grand and the other fees you may have to pay in the end. Just do due diligence in research before you sign on the line.

[CA Lightfoot]

i think i will have to leave the next one alone
No mods? That's reason enough NOT to lease.