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Old Yesterday, 06:09 AM
 
17,210 posts, read 18,609,416 times
Reputation: 24989

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Quote:
Originally Posted by gentlearts View Post
Iím thinking of leasing a more comfortable car. I want to trade in my present car.
I want a lower payment and no money down.

I want to be quick, in and out without a lot of fooling around. If the numbers donít add up, I want to know in 15 minutes, not 2 hours. I donít even know what I donít know.

Aside from how much they are willing to give me for my car, what are the variables?

How much is the car?
How long is the lease?
What is the residual value?
What else?

Thanks.
First of all sell your car yourself. Trading in youíll give up money.

Second of all. Roll the required down in the payment.
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Old Yesterday, 08:50 AM
 
Location: San Ramon, Seattle, Anchorage, Reykjavik
1,999 posts, read 831,184 times
Reputation: 2722
Quote:
Originally Posted by Quietude View Post
Leasing is not a cheap way to get a new car. It's an alternate process that has been hyped as such but is almost wholly loaded in favor of the dealer/lessor.

You might want to talk to a financial adviser with good grounding in vehicle options, rather than assume a lease is the answer and that you just need to know a few details.
Amen. Be prepared, when the numbers are all added up, to pay 22-25% TRUE interest on your lease. This is a strong reason why people are car rich but wealth poor.
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Old Yesterday, 12:10 PM
 
5,808 posts, read 6,652,711 times
Reputation: 3545
There are very few situations in which leasing is the best option.

Why do you want to lease, OP?
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Old Yesterday, 01:17 PM
 
6,285 posts, read 11,780,504 times
Reputation: 6556
Quote:
Originally Posted by z28lt1 View Post
There are some good sites that explain leasing, I would recommend reading a bit.


Your payment will be calculated from:
-Selling Price - Cap Cost

-Down Payment / Cap Cost Reduction (none for your goals)

-Length
-Residual
-Money Factor (another way to look at interest rate)


You'll have a mileage allowance which will indirectly impact the residual (less miles = worth more at the end)
Understand how much it costs per mile if you go over, so you can determine how stressed you'll be taking long trips in it.


Look at other terms and fees. Some may have an "acquisition fee" to start the lease, and some may have a "Termination fee" a payment you make when you turn in the lease. There may be a separate early turn in termination fee as well.


With no down payment, you'll be upside down pretty quickly, so you probably want to consider gap insurance, and some places will included that in the lease payment.


They may also include prepaid maintenance and various things if you want them - which sometimes is a money loser and occasionally works well because it ups the residual.


Then dealer fees as well....figure out every fee so you are not surprised.
The bolded above is untrue. You will never be "upside down" as you don't own the car and therefore have no equity nor lack thereof. Never put month down on a lease as there is zero savings to doing so.
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Old Yesterday, 01:26 PM
 
6,584 posts, read 3,654,989 times
Reputation: 8830
Quote:
Originally Posted by DetroitN8V View Post
The bolded above is untrue. You will never be "upside down" as you don't own the car and therefore have no equity nor lack thereof. Never put month down on a lease as there is zero savings to doing so.
It is possible to have "equity". If near the end of the term the market value of the car is more than your residual + any buyout fees, you can cash that out. Something that is fairly common with Toyotas/Subarus/etc with exceptional resale values. You can buy it out at any time(then sell right away) just like a financed car.

And yes you do need Gap, if you total the car you're still on the hook. But most include that automatically, agreed no reason to do any down payment.
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Old Yesterday, 01:33 PM
 
6,285 posts, read 11,780,504 times
Reputation: 6556
Quote:
Originally Posted by notnamed View Post
It is possible to have "equity". If near the end of the term the market value of the car is more than your residual + any buyout fees, you can cash that out. Something that is fairly common with Toyotas/Subarus/etc with exceptional resale values. You can buy it out at any time(then sell right away) just like a financed car.

And yes you do need Gap, if you total the car you're still on the hook.
True, the market value can be greater than that of the lease buyout and GAP may not be a bad idea, but a down payment is. If you total the car, your down payment is lost. The insurance company will not pay out anything greater than the lease buyout, which goes to the finance company.
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Old Yesterday, 01:35 PM
 
Location: N of citrus, S of decent corn
35,905 posts, read 44,058,075 times
Reputation: 59624
Quote:
Originally Posted by ferraris View Post
There are very few situations in which leasing is the best option.

Why do you want to lease, OP?
As I said, I donít know what I donít know, but I passed a billboard advertising an SUV lease for $179. I donít even know what dealer or kind of car. It started me to thinking, why am I paying $400. a month to buy a car I dont even like, if I could lease one for half as much? Thatís what started this whole thing.
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Old Yesterday, 01:36 PM
 
4,174 posts, read 3,856,218 times
Reputation: 3218
Quote:
Originally Posted by Quietude View Post
Leasing is not a cheap way to get a new car. It's an alternate process that has been hyped as such but is almost wholly loaded in favor of the dealer/lessor.

You might want to talk to a financial adviser with good grounding in vehicle options, rather than assume a lease is the answer and that you just need to know a few details.

Yup. Get one a year old used that is still under powertrain warranty, use it 2-3yrs for how every many miles you want, then sell it before it hit 90-100K and needs a bunch of mandatory maintenance.
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Old Yesterday, 02:16 PM
 
731 posts, read 1,274,000 times
Reputation: 889
Quote:
Originally Posted by DetroitN8V View Post
The bolded above is untrue. You will never be "upside down" as you don't own the car and therefore have no equity nor lack thereof. Never put month down on a lease as there is zero savings to doing so.

You don't have to own the car to be upside down.


You drive the leased car for 5 months. It is stolen. You owe the dealer the remaining lease payments plus the residual for the car that is now gone. Your insurance company pays out the value of the car, which as we all know depreciates significantly the day it leaves the lot, and is very likely going to be less than what you owe on the car if you put 0 down. Therefore, you owe more than it is worth - which is the definition of upside down -- and must come up with the difference. That is what GAP insurance is for.




Quote:
Originally Posted by gentlearts View Post
As I said, I don’t know what I don’t know, but I passed a billboard advertising an SUV lease for $179. I don’t even know what dealer or kind of car. It started me to thinking, why am I paying $400. a month to buy a car I dont even like, if I could lease one for half as much? That’s what started this whole thing.

I will say there is some very good advice on leasing in this thread, and it often doesn't make financial sense, particularly if you are after a certain specific car. However, once in a while a manufacturer wants to push cars and offers good incentives for leasing and makes it worth while. My general experience with the billboard/advertisement lease deals is generally a scam, as it is for a stripper model that they don't have in stock, and high fees, etc.... But occasionally, there is a really good lease deal.


I remember way back in the late 90's when Mitsubishi was trying to gain market share you could grab a Gallant on lease for a song and a dance. A few years back there were some killer lease deals on a Chevy Volt after Chevy and government incentives. So, occasionally, it makes great sense, and maybe the $179 a month you saw does, but you'll have to investigate the model, availability, and all the fees and costs.
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Old Yesterday, 02:25 PM
 
6,285 posts, read 11,780,504 times
Reputation: 6556
Quote:
Originally Posted by z28lt1 View Post
You don't have to own the car to be upside down.


You drive the leased car for 5 months. It is stolen. You owe the dealer the remaining lease payments plus the residual for the car that is now gone. Your insurance company pays out the value of the car, which as we all know depreciates significantly the day it leaves the lot, and is very likely going to be less than what you owe on the car if you put 0 down. Therefore, you owe more than it is worth - which is the definition of upside down -- and must come up with the difference. That is what GAP insurance is for.
With all due respect, I don't think you understand how a lease works. If the car were to get stolen and never recovered, you'd be forced to pay the buyout. That's where GAP may help; if the insurance value is less than the buyout. You don't have the pay that plus the remaining payments nor is the dealer at all involved once you sign the deal and leave.

The lease-end buyout is determined at the lease inception and is not reduced by a down payment. The amount owed in the event of a totaled car does not change based on a down payment. The down payment simply goes away. Again, never put money down on a lease.
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