Andy,
ok, here's the thing.
When you get a lease, you're also getting a loan. You can get a loan to either lease or purchase a car. However, the amount loaned for a lease is usually less, because leases have a buy back at the end of the lease term.
I've been car shopping as of late. Leases are a Bad Thing, unless you use the vehicle for your own business or want to get bilked out of a lot of money. Purchasing is almost always the way to go. You own the vehile, you can do whatever the hell you want to it, you can sell it anytime. Leasing is a way for car companies to let people drive vehicles they can't afford.
ok, here's the thing.
When you get a lease, you're also getting a loan. You can get a loan to either lease or purchase a car. However, the amount loaned for a lease is usually less, because leases have a buy back at the end of the lease term.
I've been car shopping as of late. Leases are a Bad Thing, unless you use the vehicle for your own business or want to get bilked out of a lot of money. Purchasing is almost always the way to go. You own the vehile, you can do whatever the hell you want to it, you can sell it anytime. Leasing is a way for car companies to let people drive vehicles they can't afford.
- Oct 28, 1999
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If you do a drivers program, and even in some leases, you DON'T have to turn in the car.
If it's a car that has retained it's value very well over the terms of the lease, and the value of the car is higher than the residual, you can just sell the car and pocket difference.
In a drivers program you have 4 options:
1) pay off the residual and keep the car
2) finance the remaining residual balance and keep the car after your financing is done
3) turn the car in to the dealer (or bank)
4) sell the car yourself and pocket any profit
Option 3 is the most commonly used, and 4 is the best route to go if you can.
If you got a nice car like a Toyota, Honda, or Subaru that retained it's value very well over the 2 or 3 years of the lease, you might come out ahead.
I was looking into a drivers program on a Subaru WRX wagon. I would have don it for 3 years, 10,000 miles and they were telling me that a 3 year old WRX with 30,000 miles would have only been worth $14,000. I think that whoever who made up those numbers is smoking crack. I think the WRX's will maintain their value VERY well.
If it's a car that has retained it's value very well over the terms of the lease, and the value of the car is higher than the residual, you can just sell the car and pocket difference.
In a drivers program you have 4 options:
1) pay off the residual and keep the car
2) finance the remaining residual balance and keep the car after your financing is done
3) turn the car in to the dealer (or bank)
4) sell the car yourself and pocket any profit
Option 3 is the most commonly used, and 4 is the best route to go if you can.
If you got a nice car like a Toyota, Honda, or Subaru that retained it's value very well over the 2 or 3 years of the lease, you might come out ahead.
I was looking into a drivers program on a Subaru WRX wagon. I would have don it for 3 years, 10,000 miles and they were telling me that a 3 year old WRX with 30,000 miles would have only been worth $14,000. I think that whoever who made up those numbers is smoking crack. I think the WRX's will maintain their value VERY well.
I have leased 7 cars, my current being a high demand SUV. This is my experience.
I'm no expert but here are the main points. You usually have a small down payment to make which can be used at the end of the lease to buy it out right if you want. Lease payments are usually 10 to 20 percent less then actual car payments if your were buying it. Also the percentage is interest you pay can be a lot less then regular car payments. Lease periods can be 2, 3, 4 or 5 years most being 2 or 3 years. If after the lease you decide you want to buy the vehicle you pay what is called "residual value". This is determined and put in writing on the lease papers when you do the lease. The nice thing about this is that if residual value is significanly lower then the blue book used card value, you have yourself a nice used car for a good low price. If not, turn the vehicle back to the dealer and start over.
Since my SUV has low miles and is considered a high demand vehicle the Blue Book value will be much higher then the residual value, thus I will buy it. I plan on having it another year then turn it in for another and get a good trade in value.
My 2 cents.
I'm no expert but here are the main points. You usually have a small down payment to make which can be used at the end of the lease to buy it out right if you want. Lease payments are usually 10 to 20 percent less then actual car payments if your were buying it. Also the percentage is interest you pay can be a lot less then regular car payments. Lease periods can be 2, 3, 4 or 5 years most being 2 or 3 years. If after the lease you decide you want to buy the vehicle you pay what is called "residual value". This is determined and put in writing on the lease papers when you do the lease. The nice thing about this is that if residual value is significanly lower then the blue book used card value, you have yourself a nice used car for a good low price. If not, turn the vehicle back to the dealer and start over.
Since my SUV has low miles and is considered a high demand vehicle the Blue Book value will be much higher then the residual value, thus I will buy it. I plan on having it another year then turn it in for another and get a good trade in value.
My 2 cents.
holy shinack, vi-edit, that's EXACTLY what I am thinking, the WRX!!!!
since there's only 100,000 imported, I am sure its value will be well retained.
since there's only 100,000 imported, I am sure its value will be well retained.
vi:
100,000 is this year only (don't worry
)
but not sure does it apply to Wagon.
here's some Impreza loving...
sorry, you have to scroll down under the celicas
100,000 is this year only (don't worry
)but not sure does it apply to Wagon.
here's some Impreza loving...
sorry, you have to scroll down under the celicas
If your living inside the city you don't really need a car.
I mean do you have a parking space yet?
Your going to have to pay for that. There may not be any avalible that near where you live so you will have to walk to get it anyways.
I mean do you have a parking space yet?
Your going to have to pay for that. There may not be any avalible that near where you live so you will have to walk to get it anyways.
- Oct 28, 1999
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"Subaru only plans on importing 10,000 WRXs to the States in the first year, so if you want one, you would be well advised to act quickly"
From Edmunds
From Edmunds
StageLeft
No Lifer
- Sep 29, 2000
- 70,150
- 5
- 0
In some cases leasing is good:
1) You get tax benefits to it. For instance, my dad has always leased because he somehow manages to write off most of the payments and wouldn't get as much off in financing
2) You like a new car ever 1-3 years; in this case leasing is better than buying. Thats just how the money works out.
For people so worried about this stuff and who have no idea how it works or are worried about a-holes banging their car up for parking do like I said before: Just buy a junker and be done with it. A new car can be a major hassel. Not only does it suck down your finances to a ridiculous degree but, unlike with an old car, if something happens you have a lot to worry about.
1) You get tax benefits to it. For instance, my dad has always leased because he somehow manages to write off most of the payments and wouldn't get as much off in financing
2) You like a new car ever 1-3 years; in this case leasing is better than buying. Thats just how the money works out.
For people so worried about this stuff and who have no idea how it works or are worried about a-holes banging their car up for parking do like I said before: Just buy a junker and be done with it. A new car can be a major hassel. Not only does it suck down your finances to a ridiculous degree but, unlike with an old car, if something happens you have a lot to worry about.
<< ) You get tax benefits to it. For instance, my dad has always leased because he somehow manages to write off most of the payments and wouldn't get as much off in financing >>
Under Canadian tax law, this only happens if you are a sole proprietorship, partnership or incorporated. You can then write off a portion of your lease payment depending on how much you use your car for business.
If you're joe blow, there are no tax advantages.
(Shazam, who just started his own business last week and had to read up on all this stuff)
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