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I'm moving Las Vegas, Nevada in the next 3 weeks and I want to ask if you think this is a bad idea, and why etc.
If I payoff the $15,400 amount (28 months left in lease) I could then just drive it payment free until it's time to give it back in 28 months. I checked with Ford Credit and they confirmed that. The car is $550 month because I rolled in $9,000 negative equity from my last "finance" car.
What's the drawback to this? I have $33,000 saved up, I feel like just paying it off because I have the funds "Right Now".
Car is a 2016 Ford Fusion SE. I really want a pickup truck now darn it cause I'll be driving in the Desert here and there, camping/mountain biking.
I'd really hate to "payoff" $15K into something I don't get to keep simply because I have the money now. What if something major happens down the road and you need the cash?
However. Rolled negative equity into a lease, and already trying to get rid of that car for the next one? You really need to break that cycle before you find yourself with a $700/month, 72-month payment on a $20K vehicle.
I'd pay the payment as normal and not touch savings until the car is due to be turned in. Then pay cash for something modest.
Heck no. With a lease you want to be minimally invested in the car. Ideally picking it up with no down payment. Why be invested in something you don't own?
The thing is though, wouldn't you want to get rid of the payments so you don't have to worry about it for the next 2+years?
Dude, you need to read up some on money management. You need to keep a strategic reserve of money for any unexpected expense, this alone is much more important than just paying ahead on the lease to, what, avoid the inconvenience of mailing off the payments? You can generally set up payments like this to "go" automatically at your bank, if this is the issue.
If you like the car and it "works" for you, maybe talk about ending the lease and just buy the car outright, although depending on how the lease is worded this may or may not save you any money.
You don't own the car, so why pay now? If you get into an accident you are screwed
YOU hit the nail on the head. I just got off the phone with the salesman that helped me, he actually used to be my customer at the job I left. He literally said "HECK NO!". He said if the car was god forbid stolen or totaled a few months from now, the insurance cuts the check and it goes to Ford.
This is why I'm happy I asked you guys also, THANK YOU!
OP, not to be harsh, but I think you got into a leased car without really understanding the advantages and disadvantages of leasing. There are many ways to put wheels under yourself, from services like Zip Car, renting, buy new, lease, buy CPO, buy older for cash, all the way to buy *the right* beater for cash and fix it's issues DIY. This is a spectrum of what you pay, versus how much risk you assume for inevitable "issues" that all cars have eventually. You have to have more money on the first, or at least spend more money, while the latter choices require acumen in picking the right older car and in doing the work on it yourself. There is no right answer for everybody, it just depends.
And it's not just cars. What about renting vs. buying a house, apartment, condo? Advantages and disadvantages to each. Somebody needs to post up the name of a really good general personal finance book or two, apparently no one took it on themselves to "show you the ropes" as it were, and now you are out on your own. My parents mostly tutored me on personal money management, and unfortunately neither one wrote this stuff down.
Many show biz and sports figures "make bank" big-time, but don't handle it well, and end up broke. It ain't just what you make, it's also in how you handle it.
Yeah, look into a community college or online course on money management/finance. Otherwise you end up doing things like rolling $9k negative equity and paying Mercedes money for an entry level Ford. Certainly do not rush out and buy a new pickup and roll even more negative equity into that.
OP, not to be harsh, but I think you got into a leased car without really understanding the advantages and disadvantages of leasing. There are many ways to put wheels under yourself, from services like Zip Car, renting, buy new, lease, buy CPO, buy older for cash, all the way to buy *the right* beater for cash and fix it's issues DIY. This is a spectrum of what you pay, versus how much risk you assume for inevitable "issues" that all cars have eventually. You have to have more money on the first, or at least spend more money, while the latter choices require acumen in picking the right older car and in doing the work on it yourself. There is no right answer for everybody, it just depends.
And it's not just cars. What about renting vs. buying a house, apartment, condo? Advantages and disadvantages to each. Somebody needs to post up the name of a really good general personal finance book or two, apparently no one took it on themselves to "show you the ropes" as it were, and now you are out on your own. My parents mostly tutored me on personal money management, and unfortunately neither one wrote this stuff down.
Many show biz and sports figures "make bank" big-time, but don't handle it well, and end up broke. It ain't just what you make, it's also in how you handle it.
Yeah thanks M3, I made a big mistake trading in the last car, I should have payed that off instead of hastily getting into a "new car".
I definitely learned my lesson though, for real. Years ago (2007) my credit was shot, under 600. Once I learned about improving it, it was easy. Now I'm at a 740 FICO which is pretty good. But good credit also made me get approved for car's so fast, and I left only tax/fees + 1st month payment down.
AND THEN.....you get tired of that car after 1-2 years. That's where I messed up, leasing a new car with negative equity.
Thanks again.
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