For those who lease a car.....
- Thread starter DaTT
- Start date
my wife has a relative that just leased a Honda Pilot with like $8000 down. They will pay $425 a month for like 4 years and then have a balloon payment of another $20,000 or so. I forgot the exact numbers but if they do buy it then it's going to cost them around $50,000 for the car. Crazy. Just buy it and be done with it.
Fingolfin269
Lifer
- Feb 28, 2003
- 17,948
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- 91
I would never advise a car lease unless you get some sort of crazy deal that is only offered to employees and family members of employees.
There are two big things in negotiating leases.
1. You negotiate the price of the vehicle BEFORE you talk about lease. A bet a lot of people end up paying MSRP in the lease calc.
2. You try to negotiate the residual value of the vehicle as high as possible, doing so can dramatically lower your monthly payments (this isn't that big of a deal if you intend to buy the vehicle at the end of the lease).
If you accomplish the goals above you should end up paying only the depreciation of the vehicle over the term of the lease which is a pretty good deal if you don't want to deal with maintenance, or want a new vehicle every 3 years and can abide by the terms of the lease. Leasing is not bad, it's just the math involved is pretty complex (to most people) and if you don't know what all the numbers are before you go in then the dealership will screw you by manipulating the numbers and make a mint on the car.
1. You negotiate the price of the vehicle BEFORE you talk about lease. A bet a lot of people end up paying MSRP in the lease calc.
2. You try to negotiate the residual value of the vehicle as high as possible, doing so can dramatically lower your monthly payments (this isn't that big of a deal if you intend to buy the vehicle at the end of the lease).
If you accomplish the goals above you should end up paying only the depreciation of the vehicle over the term of the lease which is a pretty good deal if you don't want to deal with maintenance, or want a new vehicle every 3 years and can abide by the terms of the lease. Leasing is not bad, it's just the math involved is pretty complex (to most people) and if you don't know what all the numbers are before you go in then the dealership will screw you by manipulating the numbers and make a mint on the car.
Pretty much what rahvim is said is true. To answer OPs question, you can put money down on the lease, however, I'd recommend against it. When buying a car you usually use proceeds from the sale of your previous car as a down payment. With leases, there's no such proceeds therefore you'll put be putting your own money down. Of course if you have a couple of thousands laying around and would like to decrease interest payments, then by all means go ahead and put down as much as you can.
Either your wife's relative is the dumbest person on the face of the planet, or you're exaggerating on an internet forum...hmm...which could it be?
- Oct 28, 1999
- 62,484
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The only way I'd put "money down" on a lease vehicle was if it was a GM vehicle and I could put my several thousand worth of GM points twords it. Pontiac Solstice anyone? :evil:
But otherwise, putting down several thousand is really counter productive and can really inflate the costs. I could see putting down a modest amount...like $1000 to cover first and last months payments and the taxes on the payments, but I would never pay out of pocket the $3,000-$5,000 that some places are asking for.
Those are another entire year worth of payments.
But otherwise, putting down several thousand is really counter productive and can really inflate the costs. I could see putting down a modest amount...like $1000 to cover first and last months payments and the taxes on the payments, but I would never pay out of pocket the $3,000-$5,000 that some places are asking for.
Those are another entire year worth of payments.
If you want to buy a car after the leasing, then put down all the money you can. For the rest of the money, you will pay interest. If you just "rent" the car, then let the last payment to be as big as possible (to reduce the monthly payments).
Here it used to be that import taxes were paid only for the final payment. It was very good for import cars, as some import taxes were up to 70%, easily offsetting the interest rates. This is no longer true, and now leasing is a much more costly endeavour
Here it used to be that import taxes were paid only for the final payment. It was very good for import cars, as some import taxes were up to 70%, easily offsetting the interest rates. This is no longer true, and now leasing is a much more costly endeavour
I bought a toyota matrix last year and the lease price was only like $20 less than the buy price. That was an easy decision.
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