Buy or Lease

[GreaseMonkey]

At the time when I bought, feds gave $7,500, state coughed up $4,000, interest rates were low as they come and stock market was in the toilet. Not only did I buy, but I paid cash for it. All these parameters changed 180 degrees.

But for me personally, leasing makes no sense. We own one car and still drive less than 6,000 miles a year. Plus, some moron in Chicago decided to put an 8% use tax on top of a 9.5% sales tax on leases. So unaffordable regardless what resale values do.

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[Dear_OP]

Great model so that consumers pay the highest depreciation and then keep coming back for more. I rented a car for 3 years when I had a business that I could write-off. I think they also call 'em leasing.

Nowadays, I keep my car for 8-10 years. 2 of 'em are even longer. I enjoy not having any car payments.

 

[MustachE]

Great model so that consumers pay the highest depreciation and then keep coming back for more. I rented a car for 3 years when I had a business that I could write-off. I think they also call 'em leasing.

Nowadays, I keep my car for 8-10 years. 2 of 'em are even longer. I enjoy not having any car payments.

I get it, but they were offering $10,600 off on the Lease on a '23 (plus dealer $5k) and I believe '24, and 1.2% interest. (Leasing is the only way to get the governments $7500 EV rebate.) $380 / mo, nothing down for 36 mo, 10,500 miles / year, which I won't use. So I'm leasing it now, and can buy it for 50% of purchase price. So I'm only paying for 50% later, plus 25% now, so 75% assuming I want to keep it, instead of nearly 90% (dealer $5k) purchase price now and high interest. That was the math when I purchased last month. MSRP was $54k, and my Residual is $25k, and should have less than 30k miles, if I want to buy it in 3 years. OR, I can sell it and maybe make some $$.

Needless to say, it was my first lease. Given the incentives, it makes some financial sense to consider it.

As some one else posted, I guess I could buy that car before my second lease payment for $38k, where the dealer purchase price was $47k after Ford rebates. But why do that when I have 1.2% interest for 3 years on a $50k car? Can't beat that with a stick.

Maybe you can see why I'm renting for 3 years? These aren't guessing numbers, they are rounded, but set in stone.

 

[MrLoganRoss]

I agree. Leasing is a “depends on the deal” sort of thing. I bought my GTPE (but did 4 years and no interest instead of paying cash). Our previous two cars were Volvos and we leased them bought out at the end (as part of the plan).

for F150 Lightning, the incentives were much better on leases so I leased and if all works out I can buy out for cash at the end.

if you are leasing, be sure to use leasehackr.com and pay their donation amount while you are car searching so you have full access to their calculator. For the dealers I went to for the lightning, they did not find all the incentives available until I showed them the program numbers. I did not get a sense they were hiding the ball.

The calculator shows all programs and leasing rates. Spoiler: the dealers often offer you the high interest lease rate or a highly marked up interest lease rate to see if you will agree to it. For the lightning, the high ford credit lease rate was 9.5 % and the low was $1.18%. That is a huge difference. They initially offered me 3.99 % and I negotiated them down. Bottom line, the dealers have wiggle room even when they show deals in their ads.

 

[Milthonvb]

Buy for 72 months 0% APR, I think is a good deal now, or not?

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