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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 2:15 pm to cwill
Thanks cwill, confirms what I'm thinking.
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 12/30/12 at 4:47 pm to drewnbrla
quote:
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.
Sounds like his wife will be on his arse until he gets her a new car...
Posted on 12/30/12 at 5:58 pm to lynxcat
quote:
Sounds like his wife will be on his arse until he gets her a new car...
That is the meaning of the season, do not forget the red bow.
Posted on 12/30/12 at 7:05 pm to drewnbrla
quote:
I would never trade in a relatively new and fully paid off car that I own to rent one
My way of thinking too...especially if the paid off car has been very liable, and let's face, if it's a car you simply love to drive & it satisfies your needs...
Posted on 12/31/12 at 12:49 am to drewnbrla
quote:
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
it isn't for a "few months" unless 36 is a few.
Posted on 12/31/12 at 3:31 am to smyce
Throw is any dings or any small damage and they hit you hard.
These days, newer cars are getting much more mileage out of them trouble free. I would buy unless I could write it off for biz.
These days, newer cars are getting much more mileage out of them trouble free. I would buy unless I could write it off for biz.
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 8:04 am to Will Cover
quote:
Will Cover
I haven't made it this far. I am just thinking ahead before meeting with the dealer. I am somewhat familiar with the deals being offered now, but I don't know how comfortable I will be with analyzing the parameters you mention on the spot. I'd have to lean on a lease analysis worksheet.
Posted on 12/31/12 at 8:09 am to Ric Flair
I understand the smart money play is to hang on to the original car for a longer time period to overcome the immediate depreciation. I drive a 2000 Lexus (13 years old) that I suspect I will drive another several years. Got my money's worth as it has had no major repair work required. Personally, I like to buy right and hang on.
However, assuming one can not cure the "3-year car flu" the current lease deals look promising.
However, assuming one can not cure the "3-year car flu" the current lease deals look promising.
Posted on 12/31/12 at 9:33 am to ynlvr
quote:
"3-year car flu"
Probably one of the most financially painful sicknesses an otherwise healthy adult can have.
Might as well lease if you must have a car every three years.
I have two sturdy but unfasionable vehicles with over 100,000 miles (both made by the same company). I haven't had a car note since 2008. My biggest worry is that both will need replacement at the same time.
We are accumulating miles on the 7 year old car faster than the 5 year old car. I expect to have to replace the 7 year old car within a year or two.
This post was edited on 12/31/12 at 9:39 am
Posted on 12/31/12 at 9:52 am to dewster
quote:
it isn't for a "few months" unless 36 is a few.
No, 36 months isn't what I'd consider a "few" but I still stand behind my opinion and would stick with the paid off car. In the end, it's your decision to make.
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