Leasing a car?

deke55555

So, I have this car. (93 Cadillac) It's nearly dead, and I think it's time to get a new one. All shiny and with that new car smell.

However, I am a car buying n00b. I basically got taken for a ride when I bought the Cadillac, and I'm tired of playing the used car game.

I'm thinking of leasing, but I don't really know what to expect.

Question A: Could I get a decent new car by lease for around 200 bucks a month or less?

Question B: How should I start figuring out which car I would want, and making sure I can get a good deal on it?


TLDR: Car leasing advice, no advice too simple.

Heir

Do you mean leasing, or buying?

Because while leasing a car may seem cheaper, you don't get to keep it unless you pay a large chunck of money at the end of the lease (I think).

I could be completely off base, but I always remember hearing that leasing is generally a bad idea.

Wezoin

Yes, it's very possible to get a car around $200/month. I'm not sure how lease rates are where you are, but around here for $200/month with $0 down you can usually only get the absolute cheapest model from each of the companies (this is in Canada, and our cars are slightly more expensive than in the US, so your mileage may vary.) Your monthly payments are highly dependent on your downpayment though. Considering you drive a cadillac right now, if you aren't opposed to sticking with GM, I believe most of them do a "Car Heaven" type thing, which is $1000 that you could add to your downpayment as I don't think most dealerships would take a '93 as a trade in.

In terms of figuring out which one you want, go to the sites and do the "customize your __________" and they have lease/financing calculators so you can figure it all out. I'd go in with those papers, say you're looking at a low end model chevy, you should also take in the price info from a low end model ford/honda/whatever else. Bassically, try and take the online prices from a couple of similar cars from different companies. (Just remember, the online prices are NOT quotes. But at the same time, prices should be fairly similar.)

deke55555

Leasing is attractive to me, because at the end of the lease I can choose to keep the car, or switch to another.

Also, as I understand it, it takes less funds on hand to lease a car than to buy one, and the overall cost is likewise less, with the caveat that I don't get to keep the car.

deke55555

Wezoin wrote: »

Considering you drive a cadillac right now

It's more important that I get something that isn't likely to break down and is reasonably gas-efficient than a particular brand. (That said, I like legroom)

Wezoin

In terms of likelihood to break down, I'd say most new cars are fairly equally reliable. I know alot of people swear by the asian cars saying that they're highly reliable, but the difference in reliability between them and an american car is exaggerated.

I'm fairly sure the same could be said for gas efficiency (although some asian cars are more gas efficient, it's not as big a difference as everyone makes it out to be)

flatlinegraphics

yes, leasing means that you are basically doing a long term rental.
pros:
- you get to drive a better car than you can normally afford.
- you don;t pay property tax on it
- anything major happens, not your problem
- you get to drive a new car every other year.
cons:
- money pit
- you are responsible for a certain amount of miles. go over the milage limits, and you are paying $.10 a mile.
- you are still responsible for minor repairs, maintanance. remember, this isn;t your car.
- end of term, if you are way over mileage, it may be cheaper to buy the car. problem is, the buy out is more than the car is worth.
- you have to carry alot of insurance. you have to anyway with financing, but it may be higher for leased vehicles.

BlochWave

My dad ALWAYS leased cars, and then at the end bought the one he was leasing

Now, about 5 years later, I was just on the phone with him last night sure enough talking about getting cars, and he said, and I quote, "that was fucking stupid, never lease a car"

That might be extreme, google and make sure you understand what you're paying for(it's like you're paying for the value the car depreciates when you drive it or something fancy)and whatever you do don't think "well if I like it I can just buy it" 'cuz you'll have just pissed away some thousands of dollars in effect

Wezoin

My family has leased cars for about the last 10 years. The only major downside is at the end if you want to buy a car instead of leasing it you've got nothing to sell for a large lump sum, but it's definately the cheapest way to drive a new/fairly new car.

BlochWave

The only major downside is at the end if you want to buy a car instead of leasing it you've got nothing to sell for a large lump sum,

well that and they don't just charge you the difference between what you've paid and its original value, if they did there would be NO disadvantage to leasing over buying. Leasing itself is pretty fair so long as you understand what it is you're doing and are ok with it, but you basically get ripped off trying to buy it, and that's what happened to my dad

Zeon

BlochWave wrote: »

The only major downside is at the end if you want to buy a car instead of leasing it you've got nothing to sell for a large lump sum,

well that and they don't just charge you the difference between what you've paid and its original value, if they did there would be NO disadvantage to leasing over buying. Leasing itself is pretty fair so long as you understand what it is you're doing and are ok with it, but you basically get ripped off trying to buy it, and that's what happened to my dad

Actually they do charge you the difference in the cost versus what youve paid. The difference is, because youre paying less than the total price of the car over however many years youre leasing it for, but youre still paying interest on the total price of the car, you end up paying "more", because of interest, than the value of the car. Its the same way you will pay more for a car over a 5 year financing plan versus a 2 year financing plan, or outright buying the car with cash.

That said, im currently leasing a car right now. The big upside of leasing, if youve got a lot of extra money to spend on a car, is that you can get a new car all the time. If you go for a 1 or 2 year lease, you can get a new car every 1 or 2 years. The downside is that if you start to like the car and want to keep it forever, youll end up paying way more than the car is "worth".

Personally, i wouldnt lease again, only because its a pain in the ass. Honda finance has sent me like one letter a month threatening to terminate my lease over the stupidest shit, once for cashing a rebate check they sent me, once for non-payment, and three for not having insurance. None of these times i was at fault, but it still took an hour or two on the phone and then mailing shit to them to prove to them that im not violating my leasing terms.... Ive been seriously contemplating buying out my lease with a low interest loan, the only shit part is i get screwed since for some reason honda finance adds the total amount of PER ANNUM interest to the balance of the lease from day 1, instead of accumulating it PER ANNUM as the contract says. So to buy out my lease on my 17000 dollar car from the first day of my lease, i would have had to give them 25000 dollars, and then i have to pay regular interest on the loan i used to buy out the lease, so id end up paying almost double what the car is worth.

PirateJon

BlochWave wrote: »

My dad ALWAYS leased cars, and then at the end bought the one he was leasing

Now, about 5 years later, I was just on the phone with him last night sure enough talking about getting cars, and he said, and I quote, "that was fucking stupid, never lease a car"

Truth. If you like having the newest, shiniest car all the time, you lease. If you want to save money in the long run, you buy.

Wezoin

PirateJon wrote: »

BlochWave wrote: »

My dad ALWAYS leased cars, and then at the end bought the one he was leasing

Now, about 5 years later, I was just on the phone with him last night sure enough talking about getting cars, and he said, and I quote, "that was fucking stupid, never lease a car"

Truth. If you like having the newest, shiniest car all the time, you lease. If you want to save money in the long run, you buy.

To add to this, the rule most people I know tend to go by is if you want the car for 5 years or less, it's cheaper to lease, if you want it for more than 5 years, it's cheaper to buy.

BlochWave

And there is some argument to be made for always wanting the newest car.

You'll understand the argument the first time your older car's ignition system fails going 70 on a highway on a 100 degree day in heavy traffic. Coming home from your college graduation ceremony

KMFurDM

Wezoin wrote: »

PirateJon wrote: »

BlochWave wrote: »

My dad ALWAYS leased cars, and then at the end bought the one he was leasing

Now, about 5 years later, I was just on the phone with him last night sure enough talking about getting cars, and he said, and I quote, "that was fucking stupid, never lease a car"

Truth. If you like having the newest, shiniest car all the time, you lease. If you want to save money in the long run, you buy.

To add to this, the rule most people I know tend to go by is if you want the car for 5 years or less, it's cheaper to lease, if you want it for more than 5 years, it's cheaper to buy.

Well...maybe. You need to start thinking about residual value when you buy. You only bother with that with a lease if you are thinking of buying the car out at the end, but, that more or less equals...well...Cactus + Anus + Violent Insertion = I'm sure you can come to a conclusion.

ViolentChemistry

If you're the sort of person who doesn't keep a car more than two years, leasing is a great idea. If you drive your cars until they die, buying is worlds cheaper. Particularly end-of-model-year clearance or one or two years old used.

Snowcone

ViolentChemistry wrote: »

If you're the sort of person who doesn't keep a car more than two years, leasing is a great idea. If you drive your cars until they die, buying is worlds cheaper. Particularly end-of-model-year clearance or one or two years old used.

I'd also add that generally speaking leasing is a rip off.