... hee heeI did it once, never again.
The car depreciates faster than your payments pay down the lease. I ended up paying another 8k at the end.
Save yourself some grief/$$$ and buy a 2-3 year old model.
Basically you are renting a car until they make you buy most of what you could have bought it for new.
Had this just last week. I have never leased so I thought it would be interesting for a fun weekend car. She wanted a Fiat. I was getting crazy numbers for that car, basically $365 a month for a two year lease. He finally slipped and stated “we take the sticker and divide by the time involved and depreciation.” Sticker.
Avoid if you can unless you know you want to purchase the vehicle after the end of the lease.
I contacted my local Honda dealer via email over the weekend and asked for a quote on an Accord EX-L coupe, with a MSRP of $28,785.00 according to the Honda pricing website.
This was a 3 year lease, 12k per year with nothing down. The sales manager responded with a quote of $389.59 per month.
So here's the kicker, I went to several internet sites that offered lease calculations and based on the MSRP, months of lease, sales tax included, the highest payment I came up with was approx. $221.00 per month.
So what is the dealership factoring in that would create a $160.00 per month discrepancy in the monthly lease payment?
I appreciate any good advice and will take all expected others with a grain of salt...........Thank you
1. that you stay under the specified mileage of the lease (excess mileage can be very costly, and make what seems a good deal end up as a very expensive deal)
2. That you take good care of the car..especially outward appearance, dents, chips, paint discoloration. You will be charged through the nose for these items at the end of the lease.
Of course, if you are planing to buy the car at the specified price at the end of the lease, then you don't have to worry about either of these.
... hee heeYou’re not limited to your local dealer. You’re also not limited to full sticker when determining lease payment. Work your deal, get your price then discuss payment. Price to lease, with a number of options, versus price to purchase, with a number of options, including down payment or no.
Then, shop it, hard. They’re taking you for a low information person who will just pay what they’re asking.
Run it through the lease calculator on the Honda website and see what you come up with, not this I’m pretty sure.
Avoid leasing unless you can write it off. Also, watch the mileage limitations. Most leases have 10,000 miles per year in teh lease. You’ll pay 20-30 cents per mile for everything over.
I’ve leased before and it is a poor financial move. Buy the car or get something 2-3 years old.
If one MUST buy a new car for whatever reason, they are better off in the long term to get the thing, maintain/take good care of it, pay it off as quickly as possible, and drive it until the wheels literally fall off.
The people that buy new and trade in for another every 2 or 3 years are total idiots, IMO. They are just paying interest during the time of highest depreciation, and chances are it will be ‘under water’ when they go back for the trade in. No worries though. They are totally HAPPY to just tack that negative equity onto the new loan, making someone REALLY upside down before the ink even dries on the contract and the are keys handed over.
The whole business of buying cars is just INSANE!
Dave Ramsey says its a great idea...So I say go for it...sigh...
My friend and I have sent each other car lease ads that reflect the growing trends for dealerships such as : Posche Turbo for lease $119.00/mos x 5 years. Based on $180k down, 860 Fico score, $5 mill. net worth statement, 0 miles per month, $5k/per engine startup fee and you must leave car at dealership for duration of lease.
Roughly:
List price of car - estimated value at end of lease / number of months of lease term = monthly lease payments.
There are pros and cons to leasing. If you want low monthly payments, no out of pocket $, and you don’t drive more than 15k miles/yr. There are usually no repair costs because most leased cars are offered with warranties. If you buy new the depreciation is severe if you sell the car within 4/5 years. Any our of warranty problems can be costly. There are just too many variables to consider so you might want to speak with your accountant.