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Old 10-03-2011, 12:06 AM   #1
Felix The Assassin
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Join Date: September 27, 2001
Location: Orlando, FL
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Default New Automobile, lease or purchase?

Firstly, there are several case studies differentiating the two. We understand the differences.
Secondly, every dealer is different, every holiday brings a different bargain.
Thirdly, get (x) over a holiday when there is 0 down at signing, and the monthly lease is rock bottom. Columbus Day is coming up fast, and dealers are making room for the 12's!

Looking for first hand experiences. Getting the best deal. Service, anywhere or dealer required? Insurance, special considerations or deductibles? Turn-in, how does the "fair wear and tear" policy really work?

Of course if we wanted to keep it longer we would buy it to start with, so we understand that also. This could be our first lease, ending a long era of purchases and capital loses.
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Old 10-03-2011, 09:05 AM   #2
Micah Foehammer
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Join Date: November 15, 2001
Location: Asheville, NC
Posts: 3,253
Default Re: New Automobile, lease or purchase?

Quote:
Originally Posted by Felix The Assassin View Post
Firstly, there are several case studies differentiating the two. We understand the differences.
Secondly, every dealer is different, every holiday brings a different bargain.
Thirdly, get (x) over a holiday when there is 0 down at signing, and the monthly lease is rock bottom. Columbus Day is coming up fast, and dealers are making room for the 12's!

Looking for first hand experiences. Getting the best deal. Service, anywhere or dealer required? Insurance, special considerations or deductibles? Turn-in, how does the "fair wear and tear" policy really work?

Of course if we wanted to keep it longer we would buy it to start with, so we understand that also. This could be our first lease, ending a long era of purchases and capital loses.
The one car I leased had an all-inclusive service deal. All service, including scheduled maintenance, was included in the lease cost. Service HAD to be done at the dealership. The lease was for a fixed term but we extended the lease an extra year at the end of the original term at the same rate.

There wasn't anything special about the insurance except that the dealer was also included as a payee in the case of a claim. The dealership required full coverage on the car. The deductibles are generally up to you as that comes out of YOUR pocket anyway, but some dealers may insist on certain collision deductibles and medical coverage so nothing comes back on them. It's been a while so I don't remember all the details but I know that what the dealership required wasn't any different than the coverage we would have normally carried.

Not sure how the fair wear and tear works in general. In our case, the car got flooded out in Katrina. (TOTALLY submerged) Insurance company settled the claim jointly with us and the leasing company. They sent checks directly to each of us. One to the leasor for the fair market value of the car less out equity and one to us for the equity we had in the car.

Before we extended the lease we did take the car in for an inspection the year before the storm. It seemed to me at the time that the leasing company was perhaps being a tiny bit anal on what they were going to ding us for on the wear and tear. We had specific language in our lease about what was and wasn't considered fair wear and tear. Make sure your lease has something comparable and get anything they say about it IN WRITING.

Basically it was a pretty painless deal all around. It would have been sweeter if we had been able to write off the lease cost as a business expense on our taxes.

Doing an outright purchase would have actually been smarter though. The major advantage to leasing is in being able to write off the lease expense as a business expense.
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Old 10-03-2011, 11:30 PM   #3
Felix The Assassin
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Default Re: New Automobile, lease or purchase?

Very nice, thank you.
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Let every nation know, whether it wishes us well or ill, that we shall pay any price, bear any burden, meet any hardship, support any friend, oppose any foe to assure the survival and the success of liberty.

John F. Kennedy
35th President of The United States

The Last Shot

Honor The Fallen

Jesus died for our sins, and American Soldiers died for our freedom.




If you don't stand behind our Soldiers, please feel free to stand in front of them.
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Old 10-04-2011, 01:39 PM   #4
Micah Foehammer
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Default Re: New Automobile, lease or purchase?

Quote:
Originally Posted by Felix The Assassin View Post
Very nice, thank you.
Glad to help.
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Old 10-05-2011, 07:14 PM   #5
Timber Loftis
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Default Re: New Automobile, lease or purchase?

Don't buy new or lease.

Buy used. Google up some of the articles about the 10 best buys in used cars. If you're willing to get a 6 or 8 year old car you can snap up an incredible value. Some cars, like the BMW 7 series and the Audi A8 depreciated like crazy this decade. You could easily snap up a 7 Series or A8 for less than $15k I'm sure. That's a car that retailed for around $80k.

If I didn't have my E46 already, I'd be looking to pick one up. They were a great run and since they ended and the new 3 series came out, they've had a lot of problems.
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Old 10-06-2011, 12:30 AM   #6
SpiritWarrior
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Join Date: May 31, 2002
Location: Ireland
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Default Re: New Automobile, lease or purchase?

Agree with TL - buy used. Leasing has its place though.
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Old 10-06-2011, 11:03 AM   #7
Felix The Assassin
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Join Date: September 27, 2001
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Default Re: New Automobile, lease or purchase?

Quote:
Originally Posted by Timber Loftis View Post
Don't buy new or lease.

Buy used. Google up some of the articles about the 10 best buys in used cars. If you're willing to get a 6 or 8 year old car you can snap up an incredible value. Some cars, like the BMW 7 series and the Audi A8 depreciated like crazy this decade. You could easily snap up a 7 Series or A8 for less than $15k I'm sure. That's a car that retailed for around $80k.

If I didn't have my E46 already, I'd be looking to pick one up. They were a great run and since they ended and the new 3 series came out, they've had a lot of problems.
You funny!

It's an auto for the spousal unit. I'm thinking SLK, she's thinking CTS-V Coupe.

When the spousal unit's A4 starting to get expensive (mileage+age+mechanical+shop-fees=NOT AGAIN) , she had a learning moment...

I can get her in an SLK lease for less than what her friend spends on a 0'11 Tahoe!
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Let every nation know, whether it wishes us well or ill, that we shall pay any price, bear any burden, meet any hardship, support any friend, oppose any foe to assure the survival and the success of liberty.

John F. Kennedy
35th President of The United States

The Last Shot

Honor The Fallen

Jesus died for our sins, and American Soldiers died for our freedom.




If you don't stand behind our Soldiers, please feel free to stand in front of them.
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Old 10-07-2011, 01:58 AM   #8
Bungleau
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Join Date: October 29, 2001
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Default Re: New Automobile, lease or purchase?

When leases first came out, they were great for consumers. Get a great vehicle for very little, and the dealer was stuck holding the loss on the vehicle.

Times have changed, dealers realized that they were losing money (and how), and they've changed. They no longer lose money. You no longer get the same great deal as before. In fact, it will work out to a wash, if you're lucky, or you simply paying the same as you would for a car.

Don't know what they're going to charge you, but assume it's $500 per month for simple math. That's $6k per year... $12k for two years. Buy a $6k used car, earmark the other $6k for repairs and such, and you'll come out ahead.

Thinking that you'll make money on this arrangement is like thinking you can keep the dirty and nasty stuff on the internet hidden from teenagers. Ain't gonna happen.
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Old 10-07-2011, 08:17 AM   #9
Felix The Assassin
The Dreadnoks
 

Join Date: September 27, 2001
Location: Orlando, FL
Age: 59
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Default Re: New Automobile, lease or purchase?

Quote:
Originally Posted by Bungleau View Post
When leases first came out, they were great for consumers. Get a great vehicle for very little, and the dealer was stuck holding the loss on the vehicle.

Times have changed, dealers realized that they were losing money (and how), and they've changed. They no longer lose money. You no longer get the same great deal as before. In fact, it will work out to a wash, if you're lucky, or you simply paying the same as you would for a car.

Don't know what they're going to charge you, but assume it's $500 per month for simple math. That's $6k per year... $12k for two years. Buy a $6k used car, earmark the other $6k for repairs and such, and you'll come out ahead.

Thinking that you'll make money on this arrangement is like thinking you can keep the dirty and nasty stuff on the internet hidden from teenagers. Ain't gonna happen.
Not looking to make money, looking to not loose the several thousand in capital. Most leases go through a lease agency now. The dealer writes it off, the leaser pays the note, the leasee pays the leaser the monthly payment (substantially less than a new purchase). At the end of the lease, the leasee turns in the vehicle, collects the built up equity and moves along. The leasor usually sells the vehicle to the local "Budget" car lot. Everybody is happy, to include the kid that just got a 3yr old 36K mile car for about 2/3 price.

If one purchases a new vehicle, after the first three years, they loose about 3500-15000 in capital, when leasing, they gain enough equity to walk into another lease, or pocket the leftover when they get the 0 down special!
__________________
The Lizzie Palmer Tribute



Let every nation know, whether it wishes us well or ill, that we shall pay any price, bear any burden, meet any hardship, support any friend, oppose any foe to assure the survival and the success of liberty.

John F. Kennedy
35th President of The United States

The Last Shot

Honor The Fallen

Jesus died for our sins, and American Soldiers died for our freedom.




If you don't stand behind our Soldiers, please feel free to stand in front of them.
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Old 10-07-2011, 09:17 AM   #10
Bungleau
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Join Date: October 29, 2001
Location: Western Wilds of Michigan
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Shocked Re: New Automobile, lease or purchase?

Just did some actual research on the lease/buy thing, as opposed to following what I've absorbed over the years.

I'm not sure where you come up with "equity". A lease is a rental option... you rent the car for the most expensive years of its life. If a car loses $12,000 in value during the lease period, your lease payments will total $12,000. Pretty amazing.

Any "equity" that I can imagine would be along the lines of "pay extra, and get it back at the end". You can get a better return in a CD... and they ain't payin' much.

You also skipped a step at the end.

Quote:
At the end of the lease, the leasee turns in the vehicle, collects the built up equity, pays the closing costs and over-mileage charges, and moves along. The leasor usually sells the vehicle to the local "Budget" car lot. Everybody is happy, to include the kid that just got a 3yr old 36K mile car for about 2/3 price.
Neither the dealer nor the leasing company are going to lose money on this deal. They've been doing this long enough that they know how to ensure they make a profit. Only one person will lose money on this... you.
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