TA Jack

For some reason I cant reply to my own thread. Might be this junk web tv I'm using. The lease for $489/mo is for 72 mos. 12000 miles per year. Residule at end of lease. I got a rate for a nothing down 3 year lease 12kmi/yr for $875/mo with a 56% of list for a residule (plus $500 acq fee). They did offer GM supplier pricing to the public for Friday only which was about $46000 for a $52000 list 03 car (16 in stock). Gotta sell my TA and dig up some downstroke money.

rbartick

That is a lot of money to spend on a car for what is basically rental usage.

$3600 downpayment + ($489 * 72) = $38808 total rental cost over 6 years and you end up with nothing after 6 years.

RichieRich

A 72 month lease?! :nono:

Don't lease if you're gonna go more than 36 months IMHO.

As for which is a better deal for you, it's simple. Have the bank or dealership or whatever give you prices for both including tax. For the lease, multiply the payment times the term and add to that your down and residual to get the total. For a reg loan, multiply the payment times the number of months and add to that the down to get the total. The difference will tell you how much more it's costing you to lease (and it prob will be at least a little more).

I did this and ended up leasing mine two years ago. Worked out I would have broken even with 6% financing, but with the lease I get to keep/invest the money rather than put it into a depreciating asset.

Do the math and find out what works best for you. There's your answer. Neither one is always the best way to go.

vette6799

Richie:

You forget one item that greatly reduces lease costs - if the car is a business expense, which mine is, you have a great tax break. You can deduct much more with a leased car than you can a car purchased outright. There are severe limits on depreciation. Operating expenses are deductible in either case.

I figure my 2003 Z06, after taxes, costs me between 400-500 a month for a 15 K, 3 year lease. Not a bad deal.

skip89

Does it make sense to lease for longer than the new car warrantee is going to last ? :confused: :nono:

TurboTnZ06

Just buy it and don't look back. After 3 years of driving a Z06, I doubt you'll want to give it up. It's comparable to heroine or crack...

vette6799

I disagree....it depends if you want a new car at the end of those three years. As noted in my post, leasing is a cheaper alternative, after taxes, than is an outright purchase.

rbartick

The initial cost in a lease is cheaper because it basically is a rental. In the long run it will end up costing you more, unless of course you can write it off on your taxes.

If you can afford to lease (rent) a new car every 3 years then a lease makes sense. If you want to keep the car for a while then the current 0% financing deals cannot be beat by a lease.

If you do lease the car then you should avoid modifications to the car.


[Modified by rbartick, 11:39 PM 12/5/2002]

Corellian Corvette

Listen to what these people are telling you :yesnod:

You never want to lease a car for more than the term of the manuf. warrantee.

For you to lease for 72mos @ 12,000/year, you're going to have to add an additional extended warrantee to that price, just to cover the lease term. Otherwise, you'll end up paying for repairs on a car that you don't even own. So add another $1500 to that price.

Please don't take this the wrong way and I know how it might sound in writing, but if you have to lease that long to get that monthly payment, then you can't afford the car. With a 72 month lease you are STUCK with that car, no matter what, for 6 years. THEN you have to come up with the money at the end to pay, or you have to lease something else, and the only way out is to pay to get into some other lease, which will probably not be in your favor.

For the money you're spending to "rent" this car, you could find yourself a good '97 - '00 used C5, in nice condition, that you could probably own. That's a much better use of money than this type of lease.

Good luck! :D

pdvale

What do you consider the difference between owning a car out of warranty and leasing a car out of warranty?

Exceeding warranty can be for either mileage or time, so someone leasing new for 15,000 miles per year will exceed the warranty during the third year, not at the end of it.

I leased my car as a way of enjoying the car without putting cash (probably about $25K) into a depreciating asset, and have a payment that is reasonable to me (about $620 for 51 months before sales tax). I may buy the car at the end for the residual of $24,500 but who knows what my financial situation will be at that time and maybe I might get a new toy. :yesnod:

You certainly need to do your homework on the lease, and understand how
the money (payment) is calculated so that you get the right lease for you.

This is a great forum for gathering your infomation.. :D

Good luck,
Paul.

Corellian Corvette

What do you consider the difference between paying for the roof on a house you own, versus paying for a roof on a condo you rent? Why would you pay to fix something you don't own?

If you lease a car longer than the manuf. warrantee, you have to pay out of pocket for repairs on a car you have to give back. The advantage of a lease is that you're paying to "rent" the car -- again, would you pay for repairs on a car that you got from Avis? Do you pay for repairs when you rent a home? Nope - you sure don't.

If you own the car and it's out of warrantee -- the money you are spending is going back into your pocket, so to speak. You get it back, or a portion of it back, theoretically, if you sell the car - otherwise you file it as "cost of ownership" to keep somthing that is yours.

You say below "I leased my car as a way of enjoying the car without putting cash (probably about $25K) into a depreciating asset, and have a payment that is reasonable to me (about $620 for 51 months before sales tax)."

Cool that works for you. You're renting the car. If you pay the residual at the end, you're going to end up paying MORE for the car than if you had bought it initially. And, if you go over mileage or something happens to the vehicle, the only way out will be to get into ANOTHER lease - so the cycle never ends.

The problem, IMHO, is that too many people see leasing as a way to "own" a car for less money. That's a foolish view. Leasing is renting, pure and simple. I can see the advantage for some people, as a busines expense, a short term need, or for the VERY few savvy investors who really do use cash for other investments and look at the opportunity cost of that payment against investmetns.

You talk about "not knowing what your financial situation will be" at the end of your lease -- look at this another way. In 51 months, if I loose my job I will OWN a 2002 Z06 free and clear. I will be the poorest guy with the coolest car, or I could SELL the car and get some of that money back.

In 51 months, if you (or the person above) loose your job, you will have nothing. No car. No capital. Nothing to show for your money. And you will pay for any repairs for the last 15 months of that lease out of your own pocket.

I'm not trying to be harsh, but I'm trying to be realistic. Leasing for more than 3 years (the General's warrantee period) is not a smart move financailly from my perspective.

We can certainly agree this IS a great place to gather and share information!
:cheers:

pdvale

My point was that I would fix the car in order to drive it (i.e in the event of a mechanical failure) whether it was a lease or not. Obviously paying $5,000 to fix a car the day before a lease is up would be very :sad: .

Also predicting ones financial future, I was talking about whether I would get another car (C6), lease or buy it, at the end of the current lease depending on alot of factors.

Anyway, I hope TAJACK gets the info to make the best decision for his situation.

:D

Paul.

ruking1

Using your figures it appears to be .489 cents per mile and .875 cents per mile. Even with our drop like a rock ownership depreciation, my cost is .09375 cents per mile.

ronssito

:lol: :lol: :lol:

Mover

I own a transportation business. We own some trucks, and we lease some. They are both simply methods of financing. Neither one is significantly different for tax purposes in the long run. Bottom line is go with the best interest rate. But if you lease, make sure you put the cash difference for the lower payment into savings. :cool:

ShawnR

I guess it depends upon personal situations. In general I agree that I would never lease a car for long term, especially not five years or more. If you have to get out of it for some reason, getting out of a lease can be a PITA. If you buy it, finance it, it can be a lot easier to unload it if you have to. You just have to figure you don't want to end up owing more than it's worth, or the same thing, you have to come up with a load of cash at the time you sell it. I don't like being locked up in a lease that I have to depend upon someone else letting me out of. Years ago I didn't even like having a contract on my cellphone (it sucked).

I'm not sure of what all deals are out there right now. I financed my 02 for 5 years with 0% financing. With 0% financing or very low financing, it seems to me that buying, financing, would be the better option. But, like I said above, it dsepends upon the personal situation, and the only person who can answer that is the individual.

PS: How do you get a Z06 to qualify as a business expense? I need to do that! Yeah, Mr. Auditor, I need that Z06 vette for my business transportation. And I had to have that exhaust and those rims for business purposes too! :D


[Modified by ShawnR, 9:32 AM 12/9/2002]

larrysb

Holy cow batman, that burning sensation in your seat cushion is not last night's mexican dinner!

With the financing rates as *LOW* as they are now, there's precious little reason to lease. 72 months of leasing is insane.

With the rates offered today, I bought a 2002 convertible, loaded to the hilt, with a 0-deductble GMPP, didn't put a single penny in down payment either. Monthly payment? Just a hair over $900 for 60 mos. That's including all the taxes and fees and everything. In about 2 years, I'll have an equity position in the car too, so I can trade if I want to.

Seriously, look into the GMAC incentives and investigate low-rate lenders like eLoan or peoplefirst.com. There's a lot of extra low miles Z06 on the market too, which can be had for a smidge over $41K or so.