leasing a car

[Ohio Snake]

Sounds like leasing is the way to go for OP.

I’ve been back and forth on leasing my next vehicle. I’m just worried about putting miles on it. Is it better to buy extra miles up front, especially if you know you’ll go over the limit? Will it cost me and arm and leg to buy extra miles?

You have to the math on that to see if leasing versus buying is better. I found leasing my last BMW with 15K mileage and a 36 month lease was best option as opposed to 12K mileage for 60months.

If you retain a mileage car to control lease miles, your flexibility remains wide open. My wife and I currently have 4 vehicles, all purchases.


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[Ohio Snake]

You have to the math on that to see if leasing versus buying is better. I found leasing my last BMW with 15K mileage and a 36 month lease was best option as opposed to 12K mileage for 60months.

If you retain a mileage car to control lease miles, your flexibility remains wide open. My wife and I currently have 4 vehicles.....all were purchased...paying on two right now...a 2018 Explorer Platinum and 2019 Chevy Impala Premier.


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[nickf2005]

Personally, in our relatively short time of car ownership, we tend to keep them for the long haul, so owning seems to be a better option. Of our three vehicles, 2 were bought new and I don't think I'll do that again. My 500 was a different scenario, but buying my wife's Edge new was probably silly. However, we've had it for 9+ years and put 175,00 miles on it, so it worked out I suppose.

I know you have the option of negotiating the buy and the end of the lease, so I guess that's not terribly different. At this point, I absolutely hate payments and hope to buy outright going forward, as we did with my 150. I imagine with the age and mileage on the Edge, we'll have to make the decision sooner rather than later. And with that all said, it may be worth trying a lease on a Mach E...

This is truly different strokes for different folks.

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[nxhappy]

also kicking around buying a car for 12-16k, payments would be pretty low. obviously it won't be new. I like the idea of a used suburban. or maybe escalade. We need lots of cargo space right now.

 

[Stanley]

also kicking around buying a car for 12-16k, payments would be pretty low. obviously it won't be new. I like the idea of a used suburban. or maybe escalade. We need lots of cargo space right now.

Do this and if your budget allows for high payments get it payed off early. My wife and I haven't had a car payment in at least five years. Not something anyone with a lease can say.

 

[98 svt]

I was never a fan of leasing either.
I feel like it's like saving your wife for the next guy. Lol
You lease the car, and keep it nice for the next person in line.

 

[nickf2005]

Do this and if your budget allows for high payments get it payed off early. My wife and I haven't had a car payment in at least five years. Not something anyone with a lease can say.

At the crux of it all, I hate making payments and owing people money and this is why I don't think we'll ever lease. We had payments (but also paid off early) my 500 and the Edge. With my last two trucks, I've slowly stepped up using cash and residual value. More than likely we'll go the 3-4 year old used route to replace the Edge with something in the under 20k range.

OP, if you're looking to get into something big, go used. Values drop pretty good for tanks. Would a pickup also provide a solution? My 150 rides nicer and is quieter than our Edge and is our family vehicle of choice. Throw a tonneau cover on and you have a lot of storage capability.

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[Blackoyote]

I was looking into it for a DD for the wife a while back, it really isn't a bad deal to pay $200/month (forever though) to always have a newer/reliable vehicle.

Look into websites like Swap-a-lease and Lease-Trader also - great way to get into a car someone can no longer afford, who has already paid the down payment.

 

[mariusvt]

I've always been a buyer, but I tend to keep vehicles for 7-10 years. Now I'm commuting further 16-17k a year and between the miles and rock chips and everything else over an 80 mile commute that is out of my control, I'd lose my shirt at turn in time on a lease.

 

[RedVenom48]

also kicking around buying a car for 12-16k, payments would be pretty low. obviously it won't be new. I like the idea of a used suburban. or maybe escalade. We need lots of cargo space right now.

V10 Excursion.

 

[Iamchris]

A lease is money paid toward something that you will never gain possession of, you are renting an asset. If you purchased the vehicle for more money and still kept the condition and miles low, I think you could likely recover a good chunk of your money which would of course offset your higher payments. I think it comes down to math, payments, historic resale value, ect.
I leased a car once for my wife, the lower payment was nice, but we threw money at gaining nothing. To be honest... that is most cars since they basically just depreciate so rapidly that they are a relative loss anyway. Still though... math for expected years.
Personally I drive my cars for as long as possible so buying makes sense, by far, when you are willing to do that.

 

[Iamchris]

also kicking around buying a car for 12-16k, payments would be pretty low. obviously it won't be new. I like the idea of a used suburban. or maybe escalade. We need lots of cargo space right now.

This right here!

 

[nxhappy]

Sounds like leasing is the way to go for OP.

I’ve been back and forth on leasing my next vehicle. I’m just worried about putting miles on it. Is it better to buy extra miles up front, especially if you know you’ll go over the limit? Will it cost me and arm and leg to buy extra miles?

the extra miles are a joke, like 25 cents per mile ! so u gotta keep it under what is contracted lol

 

[tt335ci03cobra]

thinking about leasing a car/suv for the wife. It would be about 30-50% cheaper than her current car (non leased) at $400/month. She drives like 5000 miles a year. I would like to sell her car before it drops value. I have never leased before ...is this a bad idea ???

also kicking around buying a car for 12-16k, payments would be pretty low. obviously it won't be new. I like the idea of a used suburban. or maybe escalade. We need lots of cargo space right now.

Car dealers and short term thinking will tend to steer one to lease, practical safe thinking says buy 3-5 years used and sell before the 10 year old mark.

Today’s vehicles have a very low ownership expense to resale prospect of from years 5-9 in most cases imo.

Doing all the math, it’s pretty easy to end up at about $50-100/mo sales tax and all, over that time window depending on how much vehicle you need. Suburban is huge and ends up being expensive, but obviously leasing or buying a 2019+ is 5 times as expensive.


Anyways, example:
$15k today for 75,000 mile 2015 suburban. Sell it in 5 years for $10k at 110,000 miles.

$15k@ 8% tax is $1200

$6200 spent basically is $105 a month.

Do this on a $9k 2015 75,000 mile corolla today with $720 in taxes. Sell it for $6500 in 5 years at 110,000 miles, you literally spent $3220 over 5 years which is $a year, so $54 a month.

Lease is great if you are
•not mechanically or financially savvy, and want a hassle free experience. Great for a fresh driver that needs a safe, reliable commuter, if done on a $12-15k car and replete with perks like free washes, maintenance etc.
•fine just saying you are ok spending $200/month on a vehicle indefinitely plus inflation. Make $5k a month, want newish, often, drive under 10k a year, have at it.

I’ll never lease a car again, and I won’t finance one either. I’ll buy a $500 shitbox making $500 a week cleaning windows or some entry level self employees venture vs finance a car or get a lease personally if I lost every penny tomorrow and had to start from scratch. I’d rock a bicycle for $50 off the first job until I had enough to buy the beater.

Once you see how much the lending and leasing system really takes from you, you realize it’s $200 a month to rent a car, or $500 a month to borrow a car.

Until the title is in your name, it is just ego pleasing.

 

[tt335ci03cobra]

Also, it’s pretty easy to go liability only on a $10,000 car and self insure a replacement. Math gets fuzzy at $15k, above $20k, full coverage is cheap insurance.

Saving $400 on payment, and possibly another $100 going from full coverage on the current ride is $6000 a year. In 2.5 years, that is another $15k 75,000 mike suburban. Get my thinking? No it’s not college practical, easy, comfy safe space lifestyle, but it is very nice to have $6k a year work for you instead of someone else.

A 5 year old car is what you dreamed of 5 years ago, sacrifice today on new and shiny and tomorrow you can buy in cash new and shiny from residual income you pull from investments.

 

[nxhappy]

Also, it’s pretty easy to go liability only on a $10,000 car and self insure a replacement. Math gets fuzzy at $15k, above $20k, full coverage is cheap insurance.

Saving $400 on payment, and possibly another $100 going from full coverage on the current ride is $6000 a year. In 2.5 years, that is another $15k 75,000 mike suburban. Get my thinking? No it’s not college practical, easy, comfy safe space lifestyle, but it is very nice to have $6k a year work for you instead of someone else.

A 5 year old car is what you dreamed of 5 years ago, sacrifice today on new and shiny and tomorrow you can buy in cash new and shiny from residual income you pull from investments.

we have a growing family, I just need a larger SUV. There is no way in hell im paying $50k for a new ford or chevy SUV lol. So it's either lease or used. And of course cutting down the $400 payment.

 

[tt335ci03cobra]

You even try and buy a $50k suv on finance right now in that situation and I’ll slap a 3’x5’ democrat donkey on yer windshield.

we have a growing family, I just need a larger SUV. There is no way in hell im paying $50k for a new ford or chevy SUV lol. So it's either lease or used. And of course cutting down the $400 payment.

Go used, lease ain’t gonna be good long term. In 2.5 years you’ll have yer cash back in monthly savings, and have a new lease on life.

If you really wanna save a few bucks, see if you can find a 2015 Hyundai, or Nissan suv that fits the budget and the family. I buy American but I am also a batchelor with no mouths but my own to feed. If I had 5-6 Sally’s and Johny’s and a wife, you best know I’d walk drive a North Korean shitbox over putting debt into my family finances for a family hauler.

Do what you and more so the wife want, you guys probably already know what that will be and if you’ve made it this far, a lease or buying a used car is a non issue, won’t be too big a deal either way.

 

[coposrv]

Another benefit to a lease is the complete write off If you have a legitimate side business lease through your company.


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[tt335ci03cobra]

Another benefit to a lease is the complete write off If you have a legitimate side business lease through your company.


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Tax code is more forgiving of buying the vehicle and expensing depreciation. You put the vehicle in the businesses name, and depreciate it. Selling it has to be shown as a type of financial transaction etc similar to selling a used air compressor or other industrial machinery, unless you choose to transfer the title, etc etc... businesses can donate to a trust and then it gets very distasteful very quickly. In essence, you can set up a circular stairwell of tax fraud that is legal but very slimy. Think swamp politics just legal because a check or balance clause has an “and” instead of an “or” etc bullshit

Business Use of Vehicles - TurboTax Tax Tips & Videos

There is definite gray area. It’s very easy to get in trouble trying to be too crafty. It’s best to be very careful about broadly giving tax advice because the tax code is actually very intricate



Lease is renting
Buying is ownership

Both are expenses, but ownership offers more flexibility to address how it is used or affiliated, rent is trickier to prove use.

Many lease agreements boldly state how the vehicle can or cannot be used in accordance with the lease such as leaving the country or whatever limitations. Example, you can’t move to Canada for 3 years with the vehicle during a 3 or 4 year lease. You can vacation to Canada or Mexico for a week or something, but if you need to leave the country for 6 month, unless the leaseholder authorizes the leave, the vehicle remains.

Another consideration, if you have to break the lease early, kiss a few $$$grand goodbye unless you trade into another lease at usually a higher price.

•can’t really modify the vehicle except window tint. Change the tires or wheels, keep the stockers near and dear.
•your on the hook for how the vehicle is when returning it. With 4-5 kids, be prepared to see a $1500-3500 bill at the end for all the wear and destruction to the vehicle unless you have the strict disciplin on them that they know don’t mess with dads car or they’ll get their xbox’s and PlayStations thrown in the trash can, have to clean the whole thing with detail supplies, etc.

Lease mainly makes sense for a very early start of a single persons maybe 18 or so, in life that needs reliable and safe transportation and will be the sole driver. They just landed a $2500 a month job and don’t have $5000-10000 yet to buy a car. Do a 1 year lease, save up the difference and buy a car at the end, keep miles low and baby the shit out of it. It’s ultimately a borrowed car.

 

[nxhappy]

update ...wife and I ended up buying a 2017 dodge grand caravan ....so far we are loving it ! The extra space is definitely needed with our family.