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My wife leased a Nissan in 2017 and literally only put about 15k on it in the 36 months. The buyout was more than what used ones were going for and we did not get any kickback for the ultra low mileage. Turned it in as if i just returned a rental vehicle and didnt even get any incentives from teh dealer if we wanted to purchase or lease a new one. Complete waste in my opinion (at least that transaction).
Isn't that just making a case for leasing?
If the buyout/residual value was more than what used models were going for, then I would imagine the trade-in value would be even lower. In that case, had you purchased the car outright and kept it 36 months you would have lost more money when you went to trade it in vs if you had leased and just paid the depreciation. At least that's how i'm reading this.
If the buyout/residual value was more than what used models were going for, then I would imagine the trade-in value would be even lower. In that case, had you purchased the car outright and kept it 36 months you would have lost more money when you went to trade it in vs if you had leased and just paid the depreciation. At least that's how i'm reading this.
I guess I looked at it as why would I buy it at the end of my lease if I can buy one off the lot for less. If the buyout was less than what a used example was going for, it would have made sense to buy it. You are right though, I would have lost money if I had purchased it at first, but thats why when I purchase a vehicle I am very particular with what I buy and consider the resale value. Nissan would never fall into the category of a good buy in my opinion.
Last edited by mustangman66; 01-13-2023 at 09:54 AM..
Leasing is less expensive than buying a new car every few years.
Leasing might have made sense at one point, where as you had a set monthly payment, and you could swap out the car every 3 years or so. Now when you lease, you have to put a hefty down payment, and then get hit with a lease disposal charge at the end of the lease. The appeal used to be you didn't need to worry about coming up with a down payment, but this is no longer true.
If the buyout/residual value was more than what used models were going for, then I would imagine the trade-in value would be even lower. In that case, had you purchased the car outright and kept it 36 months you would have lost more money when you went to trade it in vs if you had leased and just paid the depreciation. At least that's how i'm reading this.
Hmmm....The way I read it is like a coin-flip where:
heads - dealership wins
tails - dealership wins
As for buying vs. leasing in this case, it completely depends on the goals mustangman66. Was the goal to not spend less money than necessary, to get to drive a new car and move to something else, etc. During the pandemic when used car prices were ridiculous I advised a bunch of my neighbors to negotiate a higher value for their lease returns. In their cases, the cars were literally going for $15K-$20K more on the used car market so the case of buying out the lease and selling the car was quite compelling. Most of the dealerships saved them the hassle and just gave them an extra $12K-$15K in credit towards their future purchase/lease...they were getting it back anyways because transaction pricing were going over MSRP...which is just insane in my opinion.
Now that I am looking at a new car, the thought of leasing, for this terminally clueless driver, did cross my mind. But for my $20K (base price) that I had for 20 years, even with two $1000+ service sessions every 10 years, like redoing the pistons, did I come out better than a lease?
The other thing is how do leases do when you want a working country car such as CB radios? Or doing animal rescues? Sure, I imagine you can always find someone who does it.....for a price.
Finally, there is getting use to that new car. I am sure I am going to be in for a heck of a culture shock with a new Forester (most likely will be) after over 20 years but which is better, 4 times in one's life.....or in the two digits?
Hmmm....The way I read it is like a coin-flip where:
heads - dealership wins
tails - dealership wins
As for buying vs. leasing in this case, it completely depends on the goals mustangman66. Was the goal to not spend less money than necessary, to get to drive a new car and move to something else, etc. During the pandemic when used car prices were ridiculous I advised a bunch of my neighbors to negotiate a higher value for their lease returns. In their cases, the cars were literally going for $15K-$20K more on the used car market so the case of buying out the lease and selling the car was quite compelling. Most of the dealerships saved them the hassle and just gave them an extra $12K-$15K in credit towards their future purchase/lease...they were getting it back anyways because transaction pricing were going over MSRP...which is just insane in my opinion.
The goal was to have a reliable vehicle for her if her commuter broke down. It was a 98 audi a4 and it had well over 200k on it with many problems but it was a blast to drive. She put all the wear and tear on that and left the nissan in the garage. I guess we expected with the ultra low mileage we would have come out ahead in some way but that didnt happen.
You are right about leasing right before the pandemic happened, those people made out like bandits. Ive heard many people who bought out there lease and then sold them for 10k more than the buyout was.
You are right about leasing right before the pandemic happened, those people made out like bandits. Ive heard many people who bought out there lease and then sold them for 10k more than the buyout was.
Those lease stories are really about an asset that unexpectedly increases in value. The people who made out like bandits could have done the same thing with a bank loan, but without the huge fees that many people faced in tring to buy out their lease as dealerships rushed to get a cut of the windfall.
As an alternative to a lease, almost always a 7 year loan will give you the same monthly payments as most leases, but it is still your property. You can sell the vehicle and pay off the loan much easier than buing out a lease, and the bank loan can be paid off at 20 months, 30 months, 40 months or any time that it is convenient. Leases are typically for 36 months, and they must be addressed on their schedule, not yours.
Also leases severely penalize minor dings and excess miles.
Those lease stories are really about an asset that unexpectedly increases in value. The people who made out like bandits could have done the same thing with a bank loan, but without the huge fees that many people faced in tring to buy out their lease as dealerships rushed to get a cut of the windfall.
As an alternative to a lease, almost always a 7 year loan will give you the same monthly payments as most leases, but it is still your property. You can sell the vehicle and pay off the loan much easier than buing out a lease, and the bank loan can be paid off at 20 months, 30 months, 40 months or any time that it is convenient. Leases are typically for 36 months, and they must be addressed on their schedule, not yours.
Also leases severely penalize minor dings and excess miles.
Do it again when the "asset" unexpectedly decreases in value.
Lots of factors to consider:
I'm retired. Have some money. Not in the market for a car.
I would lease for my wife, buy used for me. But I would prepay her lease. So it costs 5,000 (or so) a year for her to drive a new car that is constantly under warranty.
Ain't no way in hell I want to own one of today's overdeveloped technical monstrosities. I tend to keep things I like and I don't want to have to repair it.
OTOH I do love maintaining my 90 model pickup. I bought it new. I can find parts for it. I can troubleshoot it. It has a basic computer called OBD-1 and it won't shut down because it "thinks" something is wrong.
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