Has anybody here ever leased a car?

Those of you who saw the thread from earlier in the week know that I am looking for a car. Mine burned up (Really. I'm not kidding). So now, I have to replace it long before I had planned to.

For a number of reasons, the timing is awful. We just can't get into the kind of car we want right now and don't want to be stuck in something else for 10-plus years (if we buy, we're keeping it until we run it into the ground).

We found a deal we really like on a car today. Of course, they are telling us the deal goes away Tuesday (damn dealers). I know we are basically spending money and leaving ourselves owning nothing at the end of three years and I have some concerns about back-end fees.

Is this a terrible idea? I've always been against it, but it seems like it might be the right way to go right now.

 

Leasing has never made sense to me, but whatever you decide, know this:

The deal does not go away on Tuesday.

 

Yeah, I'm fairly certain that is bullshit, too. Hate that I let him even get me to consider it as a factor.

 

There is nothing wrong with leasing if you're not doing a lot of long distance driving.
You can lease with nothing down...as in ZERO!
Pay to drive for 3 years -- do not go for less than three years or less than 12,000 per year -- and you know up front what the buyout cost is after three years if you want to keep the car. You then can pay cash or finance the buyout cost for three years to purchase the car.
It can be great if done right.

If you're under the mileage and the car is in great shape after three years, turn it in, no backend cost, lease or buy a new one.

 

I just did the end part spnited describes. I kind of hurried into a lease three years ago after totaling my car, with not all that many options. So the lease ended in October, and I just went and refinanced the purchase, and basically, I got a used car with 26000 miles for $14,000 (including a new three-year, zero-deductible warranty). And the interest rate is 4.5% or so. And I even financed it for longer than 3 years.

Not for everybody, but I basically care about my car only as transportation, and this was the most hassle-free way to do the whole thing.

 

Honestly, this is a simple math problem. Owning a car can be nice, but it's not automatically the best deal.

 

If you're inclined to drive a car into the ground, as stated in the initial post, than leasing wouldn't seem to be in your best interest. You won't ever get to that great point where you don't have a monthly payment.

But if cash flow now is a bigger concern than cash flow later, maybe leasing (with its lower payments for the lease term than buying, over the same number of months) is the way to go. As SF_Express puts it, it's a way to buy a used car where you absolutely, positively know the usage and repair history of the vehicle. That's nearly impossible to achieve otherwise, unless you buy a friend's or family member's ride.

 

I leased years ago, and went well over the mileage cap. But the dealer told me (and honored it) that if I came back and leased from them again, that any mileage penalty would be waived.

I would assume those days are long gone, but it's a question worth asking. Definitely put me into a better car than I could afford to pay cash for.

 

The mileage cap is not an issue. At worst, Mrs. OOP lives close enough to home that we could keep the miles really low if it got close. No way we go over 12,000 in a year.

 

Most financial advisors would tell you leasing a car is not a good idea, and for that matter financing the purchase of a brand-new car is one of the worst things you can do with your money. You are paying escalating and continuing costs for an asset that is guaranteed to depreciate. To quote the example above of someone "getting" a car with 26,000 miles on it for $14K -- that car actually cost $23K total if you paid $250/mo on the lease, it was just a purchase with low front-end costs and a big balloon payment. On the other hand, I would bet you could buy a 3-year-old car from the dealership for about $14K right now, and you wouldn't have three years of lease payments preceding it.

Leasing has created an abundance of lightly used cars coming back to dealerships (from the people who choose not to pay off the residual). Those cars are all sold under the same dealer warranty and can be had for some good deals. If you're the kind who likes to change cars every three years, I guess the lease-vs.-buy option is worth looking into; but if you're planning to drive this car as long as you can, say 5-10 years or more, when the payments on this one end you'll be able to save all the $$$ you need to pay cash for your next (used) car.

My wife and I have two cars and we haven't had a car payment in six years. The car payment does not have to be a fixed, permanent part of the household budget.

 

Buying used is the best deal.

 

the mileage is the kicker.
you go over the mileage, it can be really expensive.