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Auto Lease or Buy?

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Auto Lease or Buy?

Old 02-20-06, 05:35 PM
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Auto Lease or Buy?

If I want to drive a new car every 3 or 4 years, is leasing still a bad idea? What about auto balloon loans?
Old 02-20-06, 05:41 PM
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Wouldn't baloon loan, but there isn't anything wrong with a lease so long as you recognize what you are doing, and that you shouldn't put in new stereos, etc. But you still need to check the lease carefully.
Old 02-20-06, 05:48 PM
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I read an article, where they said actually if you buy and keep around 4-5 years, it actually ends up saving you money in the long run. They broke down the costs of typical lease Vs typical purchase. It was interesting.

Obviously you have to put money down for down payment but you recoup your costs when you get rid of it. I believe they sad that it was based upon a vehicle in 30k range. Read it in SmartMoney I believe earlier in the week.
Old 02-20-06, 05:53 PM
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Originally Posted by SpaceBoy
I read an article, where they said actually if you buy and keep around 4-5 years, it actually ends up saving you money in the long run. They broke down the costs of typical lease Vs typical purchase. It was interesting.

Obviously you have to put money down for down payment but you recoup your costs when you get rid of it. I believe they sad that it was based upon a vehicle in 30k range. Read it in SmartMoney I believe earlier in the week.
you've got to save up money for a downpayment on most leases as well. Leasing is IMHO not worth it for 95% of people.
Old 02-20-06, 06:01 PM
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Originally Posted by Cardiff Giant
you've got to save up money for a downpayment on most leases as well. Leasing is IMHO not worth it for 95% of people.
And I would agree with this. I did it once and it was fine for my purposes, but still didn't like the "feel" of it.

Best way to probably figure it out is to calculate what your total lease payments would be then use that figure an compare it with a site like www.edmunds.com with the depreciation of the car you are looking at. Some might be better to buy with nothing down. I have never had to put anything down to buy a car, though.

My lease was a Honda Passport, which I would not have bought, but had nice lease terms. At the end of it, they tried to get me to purchase it and even tried to take $2,000 off the residual value, which was still higher than the retail value. It was nice to be able to walk away from it.
Old 02-20-06, 06:03 PM
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Every three to four years? Bah, I want a new car every week, so I rent through Hertz.
Old 02-20-06, 06:04 PM
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I've been taught never to lease.
Old 02-20-06, 06:18 PM
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Buying a new car every 3-4 years is already the most expensive option you could possibly have if you're buying a car. At this point, buying vs. leasing is probably a matter of personal preference and feasiblity (mileage, etc.).
Old 02-20-06, 06:21 PM
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I have leased a couple of cars in the past. Once, it worked out well. Three year lease, at the end of the time, just turned the car in and walked away with no problem.

The second time, I went way over in mileage. Ended up selling the car privately at the end of the lease and making up the difference out of pocket.

After that, I thought, "Well, I'm a high mileage driver now. No more leasing for me", and I bought my current car. Apparently the high mileage was an aberation because I've been a relatively low mileage driver with the current car (averaging 10K miles per year so far).
Old 02-20-06, 06:23 PM
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depends on what you want.. you can afford a nicer car if you lease, but its never really yours

of course, there are horror stories about mileage numbers and such..

Ive leased one car, and had a great experience.. i had a 3 year lease on a mustang.. had to get out of the lease in less than 2 years (when we had griffin).. i was WAY WAY WAY over the allotted miles..
when i traded it in, they gave me more than the payoff.. so there was no penalty, and the amount over payoff that they figured in was more than I put down up front..

I think it only really works out if you trade in the car early.. If you actually keep it till the end, then you have to deal with all the lease mumbo jumbo rules.
Old 02-20-06, 06:51 PM
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Originally Posted by twikoff
I think it only really works out if you trade in the car early.. If you actually keep it till the end, then you have to deal with all the lease mumbo jumbo rules.
Actually, it really depends on the car and how much demand there is for it. Buy crap, and you won't get anything. Buy something like the '97 F150 when it first came out, and in a years time you are probably fine.
Old 02-20-06, 07:53 PM
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You could come on a fiorum and ask for blanket startments, but if you really want to know which is a better deal, WORK THE MATH and figure it out.

Only you can do this with real numbers you obtain from your dealer. Figure total cost of ownership either way and go with what is less expensive.

For me, leasing has never mathematically worked out.
Old 02-20-06, 09:09 PM
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I don't know, leasing to me always seemed like renting a home rather then buying. Truely if it is all you can afford, then I guess it is all you can afford. But I'd get a less expensive car, save up for a nice down payment and just buy.
Old 02-20-06, 09:13 PM
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Originally Posted by Sdallnct
I don't know, leasing to me always seemed like renting a home rather then buying. Truely if it is all you can afford, then I guess it is all you can afford. But I'd get a less expensive car, save up for a nice down payment and just buy.
some people feel they would like to always have a new car and not want to deal with repair costs and such.. so they get into the mindset that they will always have a payment either way.. so they might as well be leasing, so that they can be driving a nicer car..

other people would rather pick a car they like.. buy it.. drive it till its paid off.. own it.. and not have a payment for awhile..

it really is a matter of point of view
Old 02-20-06, 09:24 PM
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Originally Posted by twikoff
some people feel they would like to always have a new car and not want to deal with repair costs and such.. so they get into the mindset that they will always have a payment either way.. so they might as well be leasing, so that they can be driving a nicer car..

other people would rather pick a car they like.. buy it.. drive it till its paid off.. own it.. and not have a payment for awhile..

it really is a matter of point of view
Wasn't the big start of lease cause there is some tax advantage if you are self employed or something?
Old 02-20-06, 09:25 PM
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not sure.. but that makes me wonder

i know there is a really big tax break for buying a hybrid vehicle... is there a tax break for leasing a hybrid?
Old 02-20-06, 10:58 PM
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Originally Posted by twikoff
not sure.. but that makes me wonder

i know there is a really big tax break for buying a hybrid vehicle... is there a tax break for leasing a hybrid?
Are they still giving the big tax break for hybrids? Is there and EASY, quick breakdown of how big the break is? I was thinking I read where you only get the break up to so many sales of that model of car.
Old 02-20-06, 11:14 PM
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Originally Posted by Sdallnct
Wasn't the big start of lease cause there is some tax advantage if you are self employed or something?
Probably. If you are a company or self employed, the entire lease payment is deductable (assuming you only use it for business), but if you buy the car, you depreciate it over a 5 year period, iirc. and then you have to mess with a capital gain if you sell it and have already depreciated it completely, etc.
Old 02-21-06, 08:42 AM
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If you can stay under the 12Kper year and you want a new car every 3 years thenyes leasing is for you. The trick about leasing is to make sure you lease a car with high residuals. Lease a Honda or Toyota or some other foreign import. If your looking at FORDs or GM them you maybe better off buying it.
Old 02-21-06, 10:51 AM
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Put me down for a "buying is better than leasing".
Old 02-21-06, 11:41 AM
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Originally Posted by Sdallnct
Are they still giving the big tax break for hybrids? Is there and EASY, quick breakdown of how big the break is? I was thinking I read where you only get the break up to so many sales of that model of car.
I believe you can only get a $500 taxbreak on these now.

I was looking at Prius's back last year and you could get $1500 then, I was told at the end of the tax year, so it's now passed, you could only get $500. Who knows if I was lied to though.
Old 02-21-06, 11:47 AM
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Originally Posted by twikoff
some people feel they would like to always have a new car and not want to deal with repair costs and such.. so they get into the mindset that they will always have a payment either way.. so they might as well be leasing, so that they can be driving a nicer car..
This is my wife's perspective. She likes knowing the car she is driving our young son around in is newer, under warranty, etc. Also, the last car we bought we ended up getting rid of in three years anyway, because it was too small after we had our son. This problem, however, was more the result of our lack of foresight rather than anything inherent in lease vs buy.
Old 02-21-06, 12:01 PM
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Originally Posted by SpaceBoy
I believe you can only get a $500 taxbreak on these now.

I was looking at Prius's back last year and you could get $1500 then, I was told at the end of the tax year, so it's now passed, you could only get $500. Who knows if I was lied to though.
odd
corrie mentioned to me the other day that the current tax break for buying a hybrid is closer to 4k
of course, she isnt always right.. but she does read alot
Old 02-21-06, 12:07 PM
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Leasing has become popular because it's a way to drive a car without making much of a down payment. It's also a way to be able to drive a more expensive car than you'd be able to afford to buy. But the only time leasing really makes sense is when you only use the car for business purposes and can declare it a business expense.

You're the same guy who wants the two SUVs but you're upside down on the cars you own now, right? Boy, oh boy ... how many ways are you going to come up with to screw yourself before you figure out that you've got to scale down?
Old 02-21-06, 12:46 PM
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man i am looking to lease my next car but i want an SUV... anyone with the same experiences.

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