Posted on 01/07/2013 1:18:27 PM PST by Hot Tabasco
Roughly:
List price of car - estimated value at end of lease / number of months of lease term = monthly lease payments.
It was only good if you owned your business.
No longer a good idea.
Free country.
“I 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.”
What? That’s not right. The good thing about a lease is you don’t have to worry about depreciation. Unless you had an open end lease that are no longer in existence. Closed end leases have a “guaranteed future value” the residual that the lease co. is responsible for.
...
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.
I don't see how you can get a $221 per month lease on that car. Even if you get 0% interest on it, they are essentially saying that there is only a difference of $7,956 between the new car and the car after three years. A 2010 Accord EX-L with 36,000 miles on Kelley Blue Book was listed at $15,572 for an excellent trade in ($17,462 for private sale). AOL listed its MSRP at $26,080.
Now that makes sense. I never factored in the drastic depreciation cost of the vehicle after 3 years and that's why the calculator I used came up with such a discrepancy between it and the dealer.
See my post #25......you're absolutely correct.
I saw it and almost went for it but turned it down since they're lousy in snow and winter is now here..........
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.
Heh. When I was a young-skull-full-of-mush just out of college with my first decent-paying job, I had to have a new car every two years or so.
Then, in '84, I was front-ended in my brandy-new Bronco [oh, how I loved that truck]. It was totaled -- I survived and a switch clicked in my brain that made me realize they're all just a hunk of metal.
I still love vehicles, but haven't bought a new one since. Have had great cars and trucks -- can't complain about a one of them. And, boy, have I saved a ton of money.
Heh.... Don’t go TOO hard on your young self...
At least cars weren’t so crazy expensive back then, in relation to wages/pricing.
I think you forgot the sarcasm tag. Dave actually calls them “Fleeces”
Did I really need the sarcasm tag?
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