WTF Anyone here ever lease a vehicle? Your thoughts?

Discussion in 'The Howard Stern Show' started by Limo Wreck, Apr 15, 2016.

  1. Limo Wreck

    Limo Wreck Aboard the great mothership Staff Member

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    Limo needs a new whip. Jeep has zero percent interest for 72 months so I thought I would go check out some stuff. Ive never leased a car before but it looks like a good opportunity to get into something for less money. If you have ever leased what did you think of it and can you get around paying the money thats due at signing?
     
  2. Skipnoid

    Skipnoid Lick Me!

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    I've done it a couple of times when I had a business and decided it wasn't a good deal for me. BUT, we were doing a lot of miles too, and that killed it for me at turn-in time. So I always bought them after that. Then I switched to buying returned two-year old leases, which was a really good deal for me. You definitely CAN get a lot more car for the monthly payment on a lease, but you're not owning anything when the term is up. And if you can stay within the mileage in your agreement, there shouldn't be a huge payment due at the end. So if you want a sweet ride for an affordable monthly payment and don't care that you're really only just RENTING the vehicle, then it's a good way to go. I don't know about getting out of the down money on a lease. I would think they really want that cash.
     
  3. OlePuddinHead

    OlePuddinHead New Member

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    Im in the first year of a 3 year lease. The best lease to get out of if you want is a BMW. I drive a Mazda 6 now and i hate it. The absolute best piece of advice is make sure you can return the car within 3 days. Im stuck with mine. I used Swapalease.com to get out of my lease. Mazda sucks. Leasing is way cheaper but make sure you get every option cuz you will be stuck with it for years.
     
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  4. SouthernListen

    SouthernListen I don't follow the crowd. Sorry about that. VIP

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    Leases are about three things really.

    1. Lease factor (interest rate). Get the lease factor and multiply it by 24 to get the interest rate.

    2. Residual: Expressed as a percentage of MSRP. Jeep will likely be a little lower than some luxury and Japanese brands, probably due to the reliability issues. I was looking at some numbers today and a 36 mo 15K mi Jeep GC was .59. A Toyota was like .65. So 6% difference. But the Jeeps are often more discounted, so for a given class of vehicle it usually is about the same payment.

    3. The down payment and other fees(that are essentially more down payment). For various reasons try to put as little down as possible. There are problems involved if the vehicle is totaled and you put a lot down. But often they do require some down, due to you driving off with their asset which immediately drops 20% in value that day. Unless you have some great credit and money in the bank.


    There are formulas on how to calculate the lease payment yourself online using the various inputs. Be sure to do that as they are capable of all sorts of BS.

    0% financing often means they don't give you one of the available rebates, so check all the deals.

    Jeep/Ram/Chrysler in particular do have better rebates for people who lease, as they know it keeps you making payments and switching vehicles frequently.

    Go to TrueCar, punch in the options on the one you're interested in buying, and check and see what one of their dealers would sell you the vehicle for outright. Then try to get that matched on a lease. You could probably lease through them as well. But the lease payment is based on the purchase price, so negotiate that first.

    Also try to find "no haggle" dealers of that brand and see what prices they are advertising. (Here Grand Cherokees are $4,000 off MSRP including any rebates) . You can always at least match that.

    Get more than one offer. Everything is negotiable to some extent. If they think you just want to get in and out quickly and don't already know the jargon, they will attempt to stick it to you. They WILL say all sorts of bullshit to your face shamelessly, so if it's not in writing it never happened.

    If you are a Costco member they have a car buying service. Not sure if they do leases.

    Always just be aware that leasing is usually for convenience, it doesn't really make a vehicle cost less to operate. It is NOT a way to get more for less. They are thrilled to have "payment buyers" walk in the door, as they can manipulate that to have you pay more than you have to.

    There is a guy at Edmunds on the forums who will give you the latest residual and money factor info for your region if you ask him. Lease payments vary by time of year, as in 39 months a model year may or may not click over to an extra one. So what someone got 3 months ago might not be the same as today.

    Leases have pitfalls such as if your needs change, your employment changes, or the thing sucks and you hate it, it can be expensive to get out. Excess wear and tear like dents and big scratches will incur charges, you can't just live with them like when you own a car long-term. If it isn't clean at turn-in, they will hit you with some big charges sometimes. And, if the tires wear out right before turn-in, they might ding you for a new set. Stuff like that.

    Typically leasing means paying a little more for the convenience of not having to sell it or negotiate a trade in, not having to assume the risk of a model falling out of favor with buyers by the time you're ready to sell it, the economy tanking and reducing used car values, and getting new wheels every 3 or so years. But, like buying, trading frequently means you do incur more depreciation than longer term ownership.

    There are auto broker services who do all this for you for no fee, the dealer pays them. If you aren't well versed in cay buying you might check those out.

    Finally, everything I am reading is that we have a good chance of the bottom falling out in the economy in the next several months. We're overdue for a recession (never have we gone more than 9 years, the average is one every 4 or so) and already vehicles are piling up on dealer lots according to my research. It might pay to wait a while, as spring is a hot season for them and things may cool a bit and prices drop more. Right now what I'm seeing on Jeep GC is not particularly impressive in terms of discounts, as they're a popular brand. Inventory is not huge where I'm checking. Not sure about the cheaper vehicles they sell. And do a deal on the last day or two of the month, they really do have numbers to meet and sometimes it helps.
     
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  5. SouthernListen

    SouthernListen I don't follow the crowd. Sorry about that. VIP

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    What's bugging you about the 6? The noise I'm guessing.
     
  6. Skipnoid

    Skipnoid Lick Me!

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    That sucks dude. He's looking at a 72 month deal too. That's a long time to not own the thing when he's done. Welcome to the Shed too, BTW! The last three I bought were returned 2 or 3 year leases. I want to say that I got them for about half of original. All were in really good shape with like 30-40K on them. And they still have decent trade in (or private sale) when I'm done. But I also don't give a shit if I don't have a brand new car either. Plus, I tend to beat the shit out of them too. It works for me, but if you want that nice new car, not so much.
     
  7. Droog

    Droog Well-Known Member VIP

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    A vehicle's cost is the same whether you lease or buy. So if you're looking at a $40k car, that $40k is the price of the car, period.

    Now if you lease, the leasing company buys that $40k car and rents it to you with the intention that they will make money. The number one rule is that they will make money. Leasing will always cost more over time as you will always have a payment.

    Now figure out your cost to buy the vehicle. Since you're looking at a 72 month no interest loan, it's easy to figure out your monthly payment. But the trick is to figure out at what point do you end up ahead of the lease. if you buy, you have no mileage limit and today's leases are a joke at 10,000mi/year. You may pay more money in less time to buy, but your payments will end. The equity is important here. Even though you pay more monthly, you build equity in the car and can sell it for more than you owe. Buy a car for $40k, keep it the total 72 months, then sell it for $10k. That means your 6 year cost was $30k. How much will leasing cost you over that time with the mileage you need?
     
  8. SouthernListen

    SouthernListen I don't follow the crowd. Sorry about that. VIP

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    Oh, by the way, just in case you're not really needing an off-road vehicle and would consider them, go test drive a Volvo XC60 T5. They are currently about $10,000 off MSRP, which means they start around $35,000 (leather, panoramic roof, nav) and go up to about $40,000 (prem stereo, xenon bending lights, automatic cruise control, lane keeping etc). They are faster, handling better, ride better, safer, best seats made, and more reliable. Also a 4/50 warranty. Will tow 4,000 lbs. AWD adds $2,000. And they have some lease deals now as well. Luxury brand experience vs guys who sell Dodge Darts.
    [​IMG]
    [​IMG]
     
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  9. SouthernListen

    SouthernListen I don't follow the crowd. Sorry about that. VIP

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    Sedans and smaller cars are better used car bargains that SUVs, which tend to hold their value pretty well early on. Utility value and whatnot. But they would still save some ownership costs. You can pick up used 3 series BMW's still under some warranty for the low 20's. Half price.
     
  10. Droog

    Droog Well-Known Member VIP

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    I think he was looking at a 72 month purchase at 0% and comparing that to leasing.
     
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  11. Skipnoid

    Skipnoid Lick Me!

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    I was going to say that. :fil:
     
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  12. Limo Wreck

    Limo Wreck Aboard the great mothership Staff Member

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    I was interested in the Cherokee Trailhawk and found a dealer selling them for 4k below msrp. There is also some kind of south east rebate I can get with 0 percent for 72 months but all of those incentives end Monday I think. I think at that price and those rebates I can handle the payment without worrying about a lease but I wanted to keep the idea in the back of my mind. Youve got me wondering if I should wait now.
     
  13. OlePuddinHead

    OlePuddinHead New Member

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    My GT has 19 inch wheels which creates a lot of road noise. Apparently road noise was a big issue because they listed the sound dampening was reduced 20%. I think they need to at least double that. The windshield has really bad glare and i remember seeing it on Youtube and never realized it was an issue until i saw it for myself. The visibility is a lil hard to get used to. Now that may be just me because Ive had a coupe for the last 20 years.
     
  14. Limo Wreck

    Limo Wreck Aboard the great mothership Staff Member

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    Yup
     
  15. Mr Pink

    Mr Pink Well-Known Member

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    Actually, a high residual is a GOOD thing. When you lease a car, you're simply paying for the depreciation over the lease period. If you get a car that holds its value (Toyota) it depreciates very little and your lease payments are low.

    You get a car that doesn't hold its value and you are eating that depreciation.

    Now, why do you want a high residual vale? Because that means the car is worth more at the end of the lease. What the lender would like to do is make the residual worth exactly what the car is valued at. That way, if you turn it in, they don't take a bath.

    Bottom line, a car that holds its value means a low lease payment and a high residual. A car that doesn't hold its value often means that you've paid too much for the depreciation via you're lease payment and now, the car isn't worth shit

    Leasing a car is a complex, transaction with a little bit of gambling involved.
    Don't get caught up in the complexity and instead, negotiate the car price FIRST, before you even discuss how you'll pay for it.
     
  16. Droog

    Droog Well-Known Member VIP

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    The savings is short lived. Yes, it seems you pay less for more car, but you pay forever and never have a dime of equity. There's a premium to always driving new vehicles. The leasing companies have to make money or they don't do the deals. If you buy, especially at 0%, you can essentially become your own leasing company to yourself.
     
  17. JFK

    JFK Ask not what your country can do for you. Gold

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    Got a business?
     
  18. DrivenByDemons

    DrivenByDemons Spinoff Jesus Staff Member

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    I drive my cars till they can't move anymore. I buy.
     
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  19. Limo Wreck

    Limo Wreck Aboard the great mothership Staff Member

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    Nope. I work for a local government.
     
  20. JFK

    JFK Ask not what your country can do for you. Gold

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    Theres some good advice in this thread
     
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