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Message
Am I crazy to Lease Vs Buy a new car?
Posted on 12/30/12 at 12:58 pm
Posted on 12/30/12 at 12:58 pm
I am looking at new BMW's and their lease program is pretty tempting. I like that I don't have to worry about maintenance costs. My wife seems to get car fever every 2-3 years. I have a fully paid '09 MKS that I can trade in and probably wind up with the lease paid up through three years. What am I missing?
I think the key is the frequency of changing out the vehicle. Unlike my wife, I tend to keep my vehicles longer so don't consider leasing. I'll also have to keep an eye on the miles. She generally drives about 12,000 miles/year. I am not sure yet if I can get a 12,000 or 0nly a 10,000 mile lease.
Thoughts?
I think the key is the frequency of changing out the vehicle. Unlike my wife, I tend to keep my vehicles longer so don't consider leasing. I'll also have to keep an eye on the miles. She generally drives about 12,000 miles/year. I am not sure yet if I can get a 12,000 or 0nly a 10,000 mile lease.
Thoughts?
12
Posted on 12/30/12 at 1:14 pm to ynlvr
It really does come down to what you want...My wife was the same....she drove her BMW to work and grocery/out so no mileage issues and would switch out every 2-3 years - fit her lifestyle. I on the other hand, like you drove my car everywhere, trips, etc so buying made sense and I drive cars into the ground.
Just be aware of the mileage...it shouldn't be your trip/high mileage vehicle.
Just be aware of the mileage...it shouldn't be your trip/high mileage vehicle.
Posted on 12/30/12 at 2:24 pm to ynlvr
If you swap cars often (even 5/6 years can still be advantageous sometimes) and can stay close to mileage (penalties aren't usually terrible), it is actually advantageous to lease rather than buy (assuming similar incentive interest rates/money factor).
I've leased my wife's last two vehicles and have done a lot of research on it.
I've leased my wife's last two vehicles and have done a lot of research on it.
Posted on 12/30/12 at 2:27 pm to ynlvr
If you buy a BMW you still get 4 years of free maintenance. Covers everything but gas and tires.
Posted on 12/30/12 at 3:46 pm to ynlvr
If the numbers look good, then its not crazy. Leasing isn't that terrible of an idea.
Posted on 12/30/12 at 3:55 pm to ynlvr
My dad is a hardcore bimmer guy and usually buys but I know he is a fan of their new leases because of the turbo on the engine in the 535/335.
He worries that it is a little unproven as far as long term reliability so the lease might be the better option if it ends up being problematic and hurting resale value.
He worries that it is a little unproven as far as long term reliability so the lease might be the better option if it ends up being problematic and hurting resale value.
Posted on 12/30/12 at 3:57 pm to ynlvr
quote:
I have a fully paid '09 MKS that I can trade in and probably wind up with the lease paid up through three years. What am I missing?
I would never trade in a relatively new and fully paid off car that I own to rent one from a dealership for a few months. Just my two-cents.
Posted on 12/31/12 at 6:35 am to ynlvr
Without looking, can you tell me what the money factor is on the new BMW you are interested in? Can you explain it to us without looking?
Residual?
Capitalized cost reduction?
Acquisition fee?
Disposition fee?
Residual?
Capitalized cost reduction?
Acquisition fee?
Disposition fee?
Posted on 12/31/12 at 7:36 am to ynlvr
Why would you throw away your equity in the car you own outright to lease a car temporarily? Buy a new or certified car with the equity you built up. You aren't playing with house money and more because you just gave it back to the auto dealer.
Posted on 12/31/12 at 7:46 am to ynlvr
Do you think your wife would get "car fever" every 3 years if the MKS wasn't paid off? Although overall it isn't the best idea, maybe for the next car you purchase, you could finance for 5-6 years to delay the "car fever". That way when your wife wants a new car, you can say, "let's wait until this one is paid for, honey." Then you could take the one that's paid off, and drive it for another 4-5 years, and get her a new one. This is assuming you get a very low interest rate and buying Japanese cars (talk her into a lexus or infinity).
Posted on 12/31/12 at 8:01 pm to ynlvr
The key is using dealer lease programs, which can be heavily subsidized.
Posted on 1/1/13 at 5:07 pm to ynlvr
quote:Certified pre-owned with trade-ins every 2-3 years would be a great way to go in that case.
My wife seems to get car fever every 2-3 years.
BMW 650i runs about $100K new vs about $50K for a 2010 BMW 650i CPO - full warranty/new condition.
Posted on 1/2/13 at 8:31 am to ynlvr
quote:
Thoughts?
The last time I owned a car was in 1992. Since then I've gone to leasing both of our vehicles on three-year leases. I essentially rent two cars for $500-$600 a month with no lump sum payments. You're always under warranty and you never have to be concerned about replacing tires, batteries, etc.
If you like driving a new car, don't like to be bothered with repairs, and are not a high-mileage driver, leasing can be a nice fit.
One tip I would offer is to stick to the terms of the manufacturer-sponsored leases and don't try to customize the vehicle. You can check the manufacturer's web site for the lease terms and the particular models to which it applies. I've had excellent lease deals from Jeep, Honda, Chrysler, Saturn, and Subaru.
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