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View Poll Results: Lease or Finance
Lease 0 0%
Finance 14 100.00%
Voters: 14. You may not vote on this poll

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Old 05-13-2010, 02:18 PM
 
114 posts, read 848,159 times
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I can not help but see it this way: If we finance a new car, we own the car at the end of the term. After paying all that money into something, I like getting something in return.

What I can not see is leasing a car, and getting nothing to show for it in the end. So I'd like to read your opinions. Why would you lease a car and not buy one?
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Old 05-13-2010, 02:22 PM
 
Location: Central Texas
13,715 posts, read 31,096,671 times
Reputation: 9270
You really need another choice in your poll - neither.

Leasing seems to be a cost effective way for people to drive a new car every three years or so. It doesn't work so well if they drive a lot of miles.

I keep vehicles too long for leasing to work.

But most of all - I don't like car payments. So for some time now I only buy cars when I can pay for them.
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Old 05-13-2010, 02:58 PM
 
Location: Scottsdale, AZ
4,472 posts, read 17,665,966 times
Reputation: 4095
I agree with hoffdano, I don't like to finance or lease vehicles. If I do, it's only for a very short term (usually 6 months). I hate having payments of ANY sort, I purchase things when I can afford to pay for them in full. Nowadays, they'll finance a can of Coke from a vending machine for crying out loud!!

When I bought my Yukon new, I financed for 12 months and paid it off in 4. My Corvette I purchased free and clear, no financing what-so-ever.

Leasing is never a good option the way I see it. The people that lease are those who just want to keep up with appearances. Never lease.
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Old 05-13-2010, 03:33 PM
 
8,518 posts, read 15,617,653 times
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I've leased cars in the past. I tend to get bored with cars after a few years. Plus, it's nice to have the latest version of something. But going forward, I'll probably finance. For one, I don't like the idea of driving someone else's car. I like knowing that it's mine and that I won't have to answer to someone else later on when there's paint chips, scratches, etc. on the car. I also have a hard time keeping under my mileage cap. Lastly, I'd prefer to not have a car payment. I'd say leasing is worthwhile if you can write a lot of it off as, for example, a business expense. Or if you think you can keep the miles low, then you could try leasing it, buying it from the dealer, and then selling it. I've known people who do that and make a good amount of money.
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Old 05-13-2010, 04:01 PM
 
Location: USA
715 posts, read 1,146,828 times
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I guess you can look at leasing as paying your electric or water bill - you only pay for what you consume.

If I owned a company, I would make use of leasing. It does have it's tax advantages. I would rather spend the company money for the company rather than it go to the IRS.

For personal use, its a mixed bag. I like giving my wife a new car every 3 years or so. She's happy, I'm happy. If she's miserable, then she'll make my life miserable. So I'll consider leasing her a car.

For myself, I like buying used, with cash if I have it. I'm not picky with cars. My daily driver is 19 years old, has 215,000 miles, and starts every morning for my 70 mile roundtrip commute. I don't have to worry about scratches and dings or it getting stolen. My other reserve car is 10 years old, with slightly over 100k miles, which I use on weekends.

Here's a good write up on the advantages/disadvantages. As with anything, take it with a grain of salt.

Lease vs Buy? Car Leasing versus Buying Explained

Advantages of Car Leasing. What's Good About It?
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Old 05-13-2010, 04:39 PM
 
1,960 posts, read 4,653,688 times
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As with everything in life; there's no free lunch. Most people, just like homeowners, are plain broke. Which means they have to assess the opportunity cost of dumping all their liquid into a single purchase, and be out of an emergency savings account. As such, most people finance. The problem with financing has been stated already, is that you're yoked to a payment. And there's nothing more painful than paying a hefty bill, or even a nominal 500 buck one, while still making finance payments on the same vehicle.

Leasing is even worse, from a long-term acquisition perspective. The point of leasing is to only consume the amount you expect to get 'utility' out of the vehicle. This is for the crowd that gets bored with a car after a short amount of time. Leasing works best for them. You're not really getting ripped off other than paying for the utility based on an inflated assessment of the vehicle's value in the first three years (when you're likely to go gaga for a stupid metal contraption of a transportation mode you wanna call your everything). Still, you come out ahead of the game for your life choice (having a short attention span) when compared to taking a double hit when trying to unload a recently depreciated car that you're financing and in almost all cases, you're upside down on. As it turns out though, most people on this category are still stubborn to the idea of leasing because they either perceive the concept of not 'owning' something socially shameful, or they simply are not satisfied with the use restrictions put forth by most lease agreements. Either way, they pay the piper. Furthermore, the concept of thinking of leasing as a waste of money because you don't get a car at the end of it is dumb and useless of a comparative. It's like saying having a mortgage is great because I get a house at the end of it, but most people don't live in a property a 1/3 of the maturity period of a mortgage before unloading...ergo they didn't get a house either at the end of it. The point of renting/leasing is parceled utility. For the guy who KNOWS he's not gonna keep a clunker till it gives up the ghost, there's no benefit to going in the hole for the whole pie when all he wants to consume is the first 1/3. This is not a waste, this is a simple utility, just like food and just like housing (assuming you recognize that none of these means are sources of active investment, and are more liabilities, the cost of breathing so to speak).

Purchasing outright is the most cost effective way to own a vehicle, but it ties up a lot of liquid and does not work well for folks who do not intend to keep the vehicle until the wheels fall off. If you so much as think of the word "resale value" as part of your vehicle decision matrix, cross out this option. Cash buying is not for you. Stick to leasing, you'll come out ahead.

For the majority of folks, the optimal solution to the car purchasing matrix, from a utility and opportunity cost POV, is to finance a 3-4 year old car with appropriate miles for its age, followed closely by purchasing the same vehicle outright with cash. The reason for financing being better for most is that most people simply are cash broke and can't tie up 15-20K worth of liquid into their transportation budget, nor would it be wise to do so.

So, look at who you are as a car consumer, then look at your wallet (no, credit is not cash), and find the option that best suits your needs.

Good luck!
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Old 05-13-2010, 05:01 PM
 
Location: Eastern Washington
17,158 posts, read 56,905,862 times
Reputation: 18462
Quote:
Originally Posted by hoffdano View Post
You really need another choice in your poll - neither.

Leasing seems to be a cost effective way for people to drive a new car every three years or so. It doesn't work so well if they drive a lot of miles.

I keep vehicles too long for leasing to work.

But most of all - I don't like car payments. So for some time now I only buy cars when I can pay for them.
Agree 100%. If you know what you are doing, you can buy older-ish cars for cash and drive for a much lower cost, avoid having to carry comprehensive insurance, etc.

This works better in non-rusting country like TX or the PNW. But even in rust country you can get something 5-7 years old that's not too rusty...
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Old 05-13-2010, 08:06 PM
 
Location: Los Angeles
290 posts, read 918,936 times
Reputation: 166
You can still purchase a leased car at the end of the lease.
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Old 05-14-2010, 04:53 PM
 
Location: Eastern Washington
17,158 posts, read 56,905,862 times
Reputation: 18462
Quote:
Originally Posted by HemiCoupe View Post
You can still purchase a leased car at the end of the lease.
Well you have "open end" and "closed end" leases, or at least last time I looked that's what they had, although typically if you get to the end of the lease, and are willing to pay market value for the car rather than turn it back in, I don't see why the dealer would refuse to sell it to you.

It's probably impossible to say in advance if you would get a better overall price buying the car outright or leasing it for X years and then buying it at residual.
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Old 05-14-2010, 05:39 PM
 
122 posts, read 371,782 times
Reputation: 159
I started leasing my Pickups in the early '90s. At the time they were GMCs. Started with Sonomas and moved up to Sierras. It was good to lease because the payments were lower. Plus, the quality of the build, at the time was not worth keeping past that time frame. After the last GM Truck, a '99 GMC Sierra/"Shakerado" was traded for a Ford Supercrew, life got better. Then Ford had their recalls. Yikes!! Where do you go? I leased an '04 Toyota Tundra double cab. Great Truck!! At the end of the lease, I decided to purchase. That thing rides and drives like a car. Its quiet, tight, rattle free, hauls a bunch of heavy stuff easily and has enough room inside to haul people around like a sedan. Love this truck!!! I will drive it til the wheels fall off.
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