What Do You Think Of This Lease?

[jragosta]

A used car is ok to buy because its already taken a hit in value hopefully before you buy it. Occasionaly they run lease specials on the pre-owned. And with those cars there very little to pay to buy it at lease end.

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That's true. However, you don't save as much as you should on a used car lease.

In principle, when you lease, you're payiing for the depreciation the car will have while you are driving it. While the numbers will vary, you might expect a car to lose half of its value every 3 years. That is, a $30,000 car would be worth $15,000 after 3 years, $7,500 after 6 years, and $3,750 after 9 years (the actual percentage will vary, but the progression should be similar).

If the lease were set up properly, it should cost roughly half as much to lease a 3 year old car as to lease a new one. From what I've seen, the actual lease rate is more like 75-80% of the new lease rate. That's a lousy deal, IMHO.

[lexus411]

Lexus now has a 06 ES program. Its $399 x 36 x a $1200. cap cost reduction good until Oct 31st

[Lexdiamonds]

In order for me to get a 06 basic GS with no AWD or NAV. Would 3 or 4 thousand out of pocket get me in a $450-$470 price range? What is needed to get into a New GS out of pocket and monthly payment. Is there any programs going on now. Thanks in advance

[lexus411]

not yet there should be a big push in DEC.

[jragosta]

Lexus now has a 06 ES program. Its $399 x 36 x a $1200. cap cost reduction good until Oct 31st

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That's better than their usual deal, but is still $100 (33%) higher than the $299 lease rate for the Infiniti G35.

[Lexdiamonds]

THANKS LEX411

[SW03ES]

Lexdiamonds-

You also want to avoid paying a lot of money down on a lease. Unlike a finance you don't build equity in a lease because you're basically renting the car. When you put money down you basically just make a portion of your payments up front.

If you ever total the car or it gets stolen, the insurance company pays the owner of the car, the lessor, or the bank. You stand to loose out on your down payment.

If you want to use a good chunk of money down I reccomend you put it in a bank account and use it to make the payments for a while, or make a portion of every payment. That way its protected.

As for leasing used cars I wouldn't, the payments never work out.

[lexus411]

Lexus has actually had a few decent programs here and theremainly on the old GS and RX's. I have a few salesman that actually took pre-owned leases because it was a good deal.

[jragosta]

Lexus has actually had a few decent programs here and theremainly on the old GS and RX's. I have a few salesman that actually took pre-owned leases because it was a good deal.

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What would it cost to lease a 3 year old RX in top condition? Let's say 36 months, cap cost reduction of $1,000. My credit rating is very high.

[lenore]

According to consumers reports lease's in all forms are a rip off. Do your research. The only one making out are the dealerships.

[lexus411]

thanks for that imformative post

[SW03ES]

According to consumers reports lease's in all forms are a rip off.  Do your research.  The only one making out are the dealerships.

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Spoken by someone who doesn't at all understand leasing.

Leasing is most definately not a ripoff. Is it right for everyone? Definately not but for certain people leasing can be the only financially sound decision they can make. Leasing is a financial management tool, and for certain people in certains types of tax structure with certain type of cashflow requirements leasing can be the holy grail of finance.

I bought mine out of the lease cash to save on the monthly payment while I start a new business. I will definately lease my next one though. As a self employed person who trades cars every 3-4 years and needs the tax advantages leasing has over buying, it only makes sense for me to lease. Straight out of the mouth of my financial planner.

Don't immediately write off something you don't understand or that doesn't work for you. The "gurus" that down leasing are just as ignorant as the "gurus" that down interest only or negative am mortgages (like Suze Orman, yuck). These things are all financial management tools and all have value to specific consumers.

[jragosta]

According to consumers reports lease's in all forms are a rip off.  Do your research.  The only one making out are the dealerships.

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Spoken by someone who doesn't at all understand leasing.

Leasing is most definately not a ripoff. Is it right for everyone? Definately not but for certain people leasing can be the only financially sound decision they can make. Leasing is a financial management tool, and for certain people in certains types of tax structure with certain type of cashflow requirements leasing can be the holy grail of finance.

I bought mine out of the lease cash to save on the monthly payment while I start a new business. I will definately lease my next one though. As a self employed person who trades cars every 3-4 years and needs the tax advantages leasing has over buying, it only makes sense for me to lease. Straight out of the mouth of my financial planner.

Don't immediately write off something you don't understand or that doesn't work for you. The "gurus" that down leasing are just as ignorant as the "gurus" that down interest only or negative am mortgages (like Suze Orman, yuck). These things are all financial management tools and all have value to specific consumers.

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That's true. (Although I believe that both are abused).

A lot depends on the car you're buying. If you're getting a Ford (where the residual is low), leasing makes a lot less sense than if you're getting a Volvo (where the resiidual is high).

In our case, we leased a Volvo for my wife. Due to the extra incentives Volvo has for leases, we got the car for $292 per month - including most maintenance for free. My brother bought a new similar Volvo at about the same time.

After 9 years, if we get a similar deal, we'll have paid out about as much money as he did (on a time-adjusted basis). The difference is that we'll have driven 3 new cars in that time and he'll have driven on - but he will have a 9 year old 100,000+ mile car in his own name. Plus, he pays maintenance and we don't.

Neither of those appears to me to be a clear winner. Depending on how much you value driving a new car, either one makes sense. The point is that leasing clearly offers something that's comparable in value to his purchase- just a little different.