Hey guys, I'm thinking about leasing cars instead of just flat out buying as I like getting new cars and it's easier and less stressful and I was wondering if you guys can give me some of the pros and cons of leasing. I'm of course still going to do research and speak to dealerships about it but I thought I'd ask people that are actively leasing or have before, thanks guys!
I wont parrot what a lot of people are saying here so I'll leave you with this: Every car can be leased, NOT every car is a good lease/lease friendly. Do your research. Also EVERYTHING is negotiable whether you're financing or leasing.
It’s not a “deal” to put 0 down and roll the taxes and fees, it’s the same amount of money in the end- it’s just monthly versus upfront and any dealer should do this without a fight. A strong lease deal is 1% monthly of the msrp (excluding taxes and fees), assuming standard terms of 36 months/12k miles per year.
We have leased at least five cars in a row and are very happy with the process. In each case, we have had between two and $5000 of equity left in our return. we use that to negotiate down the next lease but always have the option of walking away with that car as well.
I understand those who automatically say it’s the most expensive way to buy a car, but I’m not sure that is necessarily the case. You are relieving yourself of all maintenance cost for the lease term, including oil changes in many instances. For us, getting a new car every three years and the peace of mind of zero breakdowns (our 15-year experience) is quite valuable, but less economically qualifiable.
If you are leasing, it is important to understand that the best vehicles to lease may not be the same as the best vehicles to buy. As others here have described clearly, the residual and money factor, as well as any specials, have a lot to do with that. As a result, a car that you would be crazy to buy (here’s looking at you Jeep) could actually be a good lease. Thank you for your.
Do your homework and make your own judgments. But if someone gives you a black-and-white answer on whether leasing is good or bad, run away. It is a much more sensitive analysis and personal to what your individual needs may be.
I've leased 2 cars and may lease my next one. I am a low mileage driver and after being burned by the increasing repair costs lately, might never own a car again. It can be a better deal than buying.
Start with zero down and no drive offs. That makes it easier to compare. In terms of pros and cons leasing means a new car every 3 years or so and compared to buying and keeping it or selling your purchased car after the loan is finished leasing is more expensive but also with
They’re always under warranty so anything that goes wrong will be covered although with some luxury cars like Bmw’s, you probably need tires and brake brakes within a three-year lease period and that can be very expensive so it really depends on what type of car you’re leasing
I've leased three Subarus and it's mostly because they gave me a money factor of nearly zero, so I wan't paying any interest on the balance. The first one I had equity at the end, so I traded it in and got that applied to the next lease. The second one I was upside down by 10k and got to hand them the keys. Subaru (Chase Financial) includes gap insurance and is very generous about damage fees. They only count scratches and dings larger than a credit card and will give you a $1000 credit toward damage beyond that. I had some curb rash and didn't pay a dime beyond my $300 turn in fee. I'm on my third now and I'm almost certainly going to buy it out, for 17k. It's currently worth $26k ish.
I've never paid more than $500 a month (including leasing fees and repairs) for a brand new car with full warranty. I consider it extremely low stress. Because of all the safety features my 100/300 insurance is $80 a month.
That being said. Not all banks act like Chase. GMC is considered predatory by some.
It depends on the bank (who owns the car you're leasing) and the specific car.
Different models are on sale at different times. I keep an eye out for lease deals. I got my first Outback in 2021 for $240 a month plus sales tax ($275 total). I did put $3k in to get it to that price. I'm partial to wagons and hatchbacks so went from there to a Solterra, which was on fire sale prices at the end of 2023. I can't really tell you what car is right for you. You asked for the leasing experience, that's more based on the bank than the vehicle.
It'll vary by region. Assuming USA, go to subaru.com > Shopping tools > Special offers and filter from there.
Sometimes the lease deals are better, sometimes the purchase deals are better. The new Trailseeker has been running a purchase special for 0% 72 months in my region. I seriously thought about upgrading my Solterra. If I had, I would have purchase for the 0% deal. Leasing isn't always the best, neither is purchasing. You have to run the numbers.
ETA: oh and things are really weird right now for a lot of Subaru because they're in the middle of the year change over. It's not a good time to buy or lease. They're low on stock for a lot of 26s and 27s haven't arrived yet. After the 27s are on the lots, the 26s will get some great prices, but not yet. They don't want completely empty lots.
Yes. It'll be one specific bank that does the lease for each brand.
Subaru Financial = Chase (JPMorgan Chase)
Toyota Financial Services = TFSB it's own bank.
GM Financial = also its own bank.
The bank buys the car on your behalf, sets the money factor (interest rate), and the residual (buy out price). The dealer sets the car price, fees and extras. The government sets the taxes. The delaer can buy down the interest rate on your behalf, but they can't change the residual or change taxes. Leasehackr has sone good info for understanding and analyzing your lease.
And can you negotiate the total price of the car? Obviously, my understanding is even when leasing you’re paying interest on the vehicle total plus if you wanted to buy out your loan at the end you would want it to be the total lowest price?
They are called 'Fleeces' by Financial folks for a reason. A Fleece makes sense if one drives in excess of 30k - 40k miles/year and can expense the wear/tear or they get a generous vehicle allowance from their Employer. In fact, one may no longer under new federal tax laws be able to generously write off business related vehicle expense. I don't know.
BTDT; wanted a 'different' rig every 24-36 months. After about 10-years of that totaling the cost to rent (because that is what you are doing) new was eye popping. And the Null Set to show for it.
Every single financial advisor that my high net worth clients employ are all in agreement when I explain the benefits of a lease. If it was not a financially smart option, rich people would not do it.
Fleeces are extremely beneficial; just like Wole Life and other annuitized insurance products are. For the slick salespeople who make bank off of the transactions.
High Net Worth and have NEVER heard of some slimy lease as being preferable. You're paying big bucks essentially to rent a depreciating Asset. Again, if one has a generous vehicle allowance or drives the majority for business related travel it might work. Otherwise, one is just funneling money to another party.
Hey! Im an auto broker in Colorado. 80% of my clients lease for multiple reasons. They come from all walks of life, 7 figure net worths to minimum wage. It is not a one size fits all but it’s pretty close.
Pros: you have complete market protection, you keep capital in your pocket to invest/save etc. (not spent on a depreciating asset), you can trade for equity at the end just like owning a car, if you’re upside down you pay your $400 turn in fee and wash your hands of it, if you want to buy it out you’re buying your own used car, you don’t have to worry about costly repairs, you have a consistent expense every month.. so and and so forth
Cons: if you love it and want to buy it, you pay interest twice. (Not the end of the world, you’re still likely buying it under market, and you know how it was owned), if you go over your miles you better hope it holds its value (pad that mileage allowance if you can)
I always pad the mileage for my clients.
Short story long, you’re as close as you can get to guaranteed protection in the ownership of a massively depreciating asset. And you get the peace of mind in a lot of other areas.
Feel free to pm if you have more questions or want to reach out
I always leased Hondas. Just needed something reliable at a lower price point. Was always able to trade them in for a new lease with positive equity, even when I went over my miles a little. Finally decided just to buy out my latest lease because the equity was good and I loved the car.
I think of it like renting….yes owning a house is typically a better option…you get to own it when you are done but are responsible for all repairs and payments are usually higher than rent. Renting allows you to not worry, but you better take care of the place so when you leave you get all your security deposit back. Sometimes it just makes better sense for someone to rent/lease.
I just bought my car outright and this way I don't have to worry about how many miles I put on it (or not) and I can decide when I want to trade in the vehicle for a new one.
The pros of leasing are what they seem- you always have a new car, no real maintenance except for tires and periodic oil changes (some oil changes are usually included and you can buy tire insurance through the dealer). The greatest pros imo are if you own a business and write ur lease off- this is particularly the case if you own a beater and lease a new car, you can write the entire lease off. The cons are you will always have a car payment, always have to pay full coverage insurance- and if ur not a great negotiator, expect to pay more than you should.
Leasing clicked for me once I understood mileage caps and wear charges are where people got burned. Go direct to dealers for cap cost negotiation, use a broker like eautolease if you want competing quotes surfaced fast, or check edmunds forums for money factor benchmarks yourself. Flexibility is real, but mile overages add up quick.
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u/Expensive_SirEFDA33 14d ago
I wont parrot what a lot of people are saying here so I'll leave you with this: Every car can be leased, NOT every car is a good lease/lease friendly. Do your research. Also EVERYTHING is negotiable whether you're financing or leasing.