Leasing vs Buying

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12-19-2005 | 02:15 AM

#21

ScionofKirkland

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Joined: Apr 2005

Posts: 139

From: Scion of Kirkland (WA)

Quote:

Originally Posted by surfcity40

Quote:

Originally Posted by ScionofKirkland

A while back there was a issue with the Audi, they found that the cars kept running into garage doors and all sorts of things just buy turning them on (no shift lock) well when 60 Min showed that on TV do you think people wanted to buy that car anymore??? NO the value just shot down by quite a bit. If you own your car you know that you have to get it fixed and you can never sell you car for a good price. If you lease you car the BANK is the one that gets to deal with it.

it's not an audi.

Quote:

Originally Posted by ScionofKirkland

Most people never really own there cars, most people trade every 4 years so why not get a lower payment pay nothing down and keep that cash in your bank where you make money??

in four years a purchase contract will have equity in the car. a lease will not.

Quote:

Originally Posted by ScionofKirkland

If you like to own your car buy it out at the end of the contract!

i see....so i've paid the requisite $250.00 per month on the lease and at the lease end i want to keep it so now i finance the residual of approximately 10K for another four years at $250.00 a month. what a deal....now i've paid for the tC for nine years but i own it to the tune of 35K in payments.

Quote:

Originally Posted by ScionofKirland

The concept of leasing is fairly simple, yet people don't completely understand it and are often skeptical.

here's how simple it is. a lease allows for someone to "rent" a car for a portion of its value. the "loan" or lease is only a percentage of the value of the car; meaning you "finance" about half of the value. the remainder of the value of the car is set aside as a balloon payment called a "residual". it is owed at the end of the lease to keep the car; or one may just turn the car in and have nothing except the memory of a slightly cheaper payment had they bought the car.

so, instead of writing a loan for the price of the car, the dealer writes the loan for about half the price of the car. if you want to keep the car you owe the other half as a one time payment at the end. you can pay it, "refinance" the balance or give it back. in essence, if you refinance the residual you pay nine years for the car to the tune of about three times its value.

Quote:

Originally Posted by ScionofKirkland

Let me ask you, after five years what do you really own?

the car.

btw, spell check is imperative if selling snake oil.

Yah my spelling stinks!

Look at the big picture and you will find that both ways can have vary good benifets, I will always lease. I like money lol.

12-19-2005 | 02:24 AM

#22

surfcity40

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Joined: May 2005

Posts: 2,366

From: HB, CA

Quote:

Originally Posted by Turbo6PGT

Ive never heard of a 84 mo. loan but I suppose someone out there does that whether its a credit union or bank. But if you think I could get a tC with a payment in my range its worth looking into because it would definitely be a car Id like to own later down the road. I might just take a drive to the dealer to see what they think, they can tell me yesor no and I just have to make the decision.

84 mos. (7year loan) is available from pretty much all lenders.

play with the numbers HERE.

i did and with a $19,000.00 tC (one with dsome added goodies instead of stock) for 84 mos, with $1500 down and a 10% interest rate, your payment will be $290.00.

with a credit score of 810, you will get 6% or less....your payment will be $255.65/mo, and you will own the car.

i'd respectfully suggest you do some research.

12-19-2005 | 04:00 PM

#23

400amonth

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Joined: Aug 2005

Posts: 339

From: Ohio

The advantage of leasing a Toyota or Honda is it holds residual value. For example at the end of your 5 year lease the balance owed on the car if wanted to buy it should be less than what you could sell it for. This will never happen on American cars.
This scenerio is fine if you DO NOT TINKER with your car and leave it stock. You go dump a bunch of money in it you should have bought not leased.
If you plan on messing with stuff but need a lower payment right now I would do a 3yr lease and then in 3 years re-fi to buy it and if your income improves you should be able to afford the new slightly higer payment and still own the car in a reasonable amount of time.
If you think "I'll buy it at the end of the 5yr lease" so that will make it ok to tinker with it....do not fool yourself. In 5 years there will be a cooler car you will want and a bank will only finance your lease balance on 3 years tops and now you have paid on a car for 8 years. Also keep in mind the miles you drive and what the down payment could have contributed stretched over a 5 yr. buy. Example $3000 down is $50 more a month you could put towards a buy per month at 60 months. Just stash 3000 in a second checking account to suppliment your monthly bills by $50 a month.

Scott

12-19-2005 | 04:42 PM

#24

Turbo6PGT

Thread Starter

Junior Member

Joined: Dec 2005

Posts: 28

From: oHIo

Quote:

Originally Posted by 400amonth

Also keep in mind the miles you drive and what the down payment could have contributed stretched over a 5 yr. buy. Example $3000 down is $50 more a month you could put towards a buy per month at 60 months. Just stash 3000 in a second checking account to suppliment your monthly bills by $50 a month.

If I had $3,000 laying around for a spare account I wouldnt have made this thread!

I would have been up there putting a down payment on the car and signing papers. And if I were more wealthy, so much that I already had $3,000, I wouldnt be buying a cheaper car like a tc. Id buy a more luxurious BMW that would probably break every few thousand miles and complain about it every time hehe.

12-20-2005 | 06:32 PM

#25

markbvt

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Joined: Aug 2005

Posts: 155

From: Burlington, VT

Leasing is all well and good if you change cars every few years. I don't. My last car was a '93 Honda Civic that I bought new off the lot. After five years it was paid for, so I got to enjoy seven years after that of not having a car payment.

I intend to keep my Scion for a long time too, which is why it made far more sense for me to buy.

--mark