The biggest question you need to ask is how much mileage she puts on the vehicle. If it's not over 10-12K per year, leasing can work for you.
In general you can get a nicer car for less money than you could by purchasing it. The car will always be in warranty and you'll get a new one every three years. You'll pay sales tax only on the amount of the monthly payment, not on the total price of the vehicle.
The best way to approach leasing is to find a factory-sponsored lease deal and stick strictly to the terms as spelled out by the manufacturer. Go to the web sites of the cars you might be interested in and look for a section titled Special Offers.
Sign-and-drive leases are generally the most favorable for the buyer. This means that you put no money up front and the first month's payment is free.
I've found the best way to negotiate a lease is over the internet. Most dealers now have an internet sales manager who in my experience is not nearly as predatory as the showroom guys. Copy down the details of the manufacturer's special offer and shoot them an e-mail asking if they have vehicles available that qualify for it. Don't set foot in the showroom until you have a deal committed through e-mail.
Some of the best lease offers are from Honda and Volkswagen, but not limited to those two. You'll find the deals on the most popular selling models with the most popular equipment. Don't try to customize beyond that or you open the door for the dealer to pull all kinds of shenanigans.
Finally, treat the sale of your existing car as a totally separate transaction. It is not
BTW, most people who purchase and finance new cars are always under water and paying far more than they would by leasing. People who are content to drive six-year old cars with 100,000+ miles on them are the only ones who may wind up paying less.
This post was edited on 4/20 at 3:08 pm