Leasing vs buying (cars)

[meeloche]

So I absolutely hate the idea of pissing away a bunch of money in a short amount of time on a vehicle that just keeps eating your money. So I guess I'm more in the leasing camp, but I don't really know enough about it.

So pros and cons to both?

[BennyLaRue]

Lease rates have gone up recently for various reasons. The cheapest way to get a relatively new car is to take over an existing lease from someone. The terms they leased under are probably signficantly better than what you can lease for now, plus you don't have to pay initial fees.

That said, this decision always depends on your specific situation and needs. There's no standard answer as to which is better. Do you need a lower monthly payment? Would you want a new car when the lease expires or would you keep this car for a long time? How many miles will you put on it? etc. etc.

[meeloche]

Well the payment size isn't the issue. I don't put a lot of miles on my vehicle, I don't care about how long I have it. The main thing was how much money I lose in the car's value over a short period. So I don't like the idea of tying up 30 thousand dollars when I may get 10 back in 5 years time.

[boost]

ya it all depends on what lease rates are at, and a ton of other variables. One important one is if you have any interest in customizing your car. Things such as aftermarket rims or possibly even a sound system could potentially violate your leasing agreement.

[BennyLaRue]

Well the payment size isn't the issue. I don't put a lot of miles on my vehicle, I don't care about how long I have it. The main thing was how much money I lose in the car's value over a short period. So I don't like the idea of tying up 30 thousand dollars when I may get 10 back in 5 years time.

Cars are money pits no matter what you do, so don't even consider them to be an asset. If you're that concerned about initial depreciation, buy a good used car.

Leasing or buying new, you're still going to pay the initial depreciation whether you buy or lease so just consider it the cost of getting a new car. Your lease payment will be calculated to be the initial cost of the car minus the depreciated value of the car after x years times the lease rate. See how the depreciation is still in there? It's just spread across your monthly payments.

You really need to compare the two specific deals and figure out the total cost after 48 months (or whatever your term is) to say what the right thing to do is.

[GatorJH]

the last two cars I have bought have been cars coming off of 2 year leases. Best value imo.

[Warpe]

^^^^
This, in a normal world. They are usually still under warranty and you've dodged the initial massive depreciation. That said, automakers are so desperate to move inventory right now it's worthwhile investigating buying new. Good luck in getting a good lease until credit starts flowing again. These days, car makers don't want to get stuck with depreciated assets at the end of the lease either.

[bode]

buying certified pre owned 1 to 2 years old > buying new and leasing.

[meeloche]

ok so fishy question. Can you lease a car thats say 1-2 years old or do they only do that with brand new cars?

[BennyLaRue]

ok so fishy question. Can you lease a car thats say 1-2 years old or do they only do that with brand new cars?

You can. But I don't know how many dealers do or what kind of rates you'd get.

You'd get the same result from swapping a lease, as I suggested in my first post.

Try www.swapalease.com or .ca, whichever is applicable. I furget if youse is Canadian.

[boost]

ya I didnt really go into it since you seem set on buying new or leasing.. but Im pretty sure Ill never buy a new car unless I am stupid rich, and even then I might not just on general principle.

[OP]

Do you know what kind of car you want to buy, I think this should also be factored in.

trucks, suvs, and cars all depreciate at different rates depending on the market...also japanese cars tend to hold value longer while a lot of american car owners are buried for the first 3 years of the loan.

[swiggidy]

So I absolutely hate the idea of pissing away a bunch of money in a short amount of time on a vehicle that just keeps eating your money. So I guess I'm more in the leasing camp

I know it's been covered, but this made me LOL IRL.

[triumphant cracker]

also..make sure the used car is not previously owned by a rental agency....and the same goes with fleet vehicles...leased and purchasing....
the people who have driven them dont give a flying fuck about the car and usually beat the snot outa it.

[a500lbgorilla]

theres a third option here that no one's discussing. Theft. There are really nice practice sims available these days. invest in some research.

[mixchange]

+1 on theft

[GatorJH]

also..make sure the used car is not previously owned by a rental agency....and the same goes with fleet vehicles...leased and purchasing....
the people who have driven them dont give a flying fuck about the car and usually beat the snot outa it.

This is very true

[LuckySlevin]

Leasing should save you money if you're buying a new car. Are you buying as a business or an individual that's a big factor. If going down the leasing route the first thing you need to decide is if you will be going for a usership style of lease, eg. Contract Hire or an ownership style of lease, e.g. Contract Purchase, Lease Purchase. You talk about depreciation and talk as if leasing is essentially renting a car, but you can buy a car through a lease. If you can be bothered it might make more sense to go for an ownership style of lease, this will give you the opportunity to sell the car at the end of the lease and profit from any equity, if the lease has been set up propperly and you can be bothered with selling the car privately at the end of the lease you should be able to make some small profit at the end end of the lease.

The usership/ownership leases operate differently from a tax point of view in terms of what you can write down to offset against your company profits for tax relief. So if a business that's something to consider too!

If you're buying as a business and you have the cashflow and just want to save money your best bet will be a very short term contract, e.g. 2 years, with a very large initial payment, this will save you interest on the monthly payments, yet still give you the VRB discounts (Volume Related Bonuses). If you are buying as a business there are other ways you can save some money with the lease. Kind of hard to offer accurate advice without knowing your full circumstances though.

Do check the small print for charges etc... as these can vary pretty substantially between leasing companies, e.g. if you're going for a usership lease the leasing company will be the registered owner of the vehicle, what do they charge you if you get a parking ticket or a speeding ticket and they have to forward these on to you?

If you decide on the lease and want me to take a look at your deal before you sign give me a shout and I will, I've sold both business and personal leasing in the past so know a thing or two about both. Gl!