I made a throwaway because i'm expecting to get flamed.
I know the general census here is that leases are an awful use of money... and i'll say a lot of the lease offers i received are awful... however if you can negotiate a solid enough deal there has to be a point where they are worth it.
I'm self employed, moderately high-income, i can write off my lease payments, so i'm in a different boat than most... And i rely more heavily on transportation than most, in that a single day without a vehicle during my prime season could cost me thousands. I won't drive a vehicle more than 5 years old anymore. But let's ignore all that for a second.
I am making my whole case based on the following assumption I would ASSUME your average mid-upper class income (say 65-90k income) individual won't be keeping a car for more than 7-10 years. So if that lease payment would work out to the cost of the vehicle over 7-10 years, wouldn't it make sense? If you have no loyalty to a specific dealership, no loyalty to a specific vehicle, and are willing to put in a bit of leg work I think you can get a lease that makes a lot of sense. I like making and chasing deals. It's exciting. I've been researching for the last couple weeks for my first ever lease deal. I purchased a new vehicle cash 5 years ago that i took a 6 hour train ride to pick up, and drive home, it took me a couple weeks to put that together. It saved me 4 grand by going to a different region that had better incentives and waiting until the end of the month and getting someone to finally need the numbers. I'm in the process of trying to work out a my first lease deal right now, and i think i've gotten numbers that make sense for me.
I just got the leasing is an awful idea talk by a family member, because "you have nothing to show for it". nd I disagree. I've aggressively negotiated with multiple dealerships within a 150 mile radius. I started off looking at every car in the class i'm looking for. Mid Size SUV with advanced drivers aids, including "auto pilot". I've looked everywhere from Toyota to BMW.
Different brands offer different incentives at any given time. Some have stronger residuals, some will negotiate more on cap cost, some have better money factors. A lot of dealerships try to hide this data and some won't provide it, or will not provide it fully. They will attract you with a great discount on the vehicle to make you think you're getting a great deal, but then mark up the Money Factor, or hide some other fees in there. And you wind up with a horrible deal.
I settled on a specific car, with the features I need, plus a couple I don't. An almost fully loaded Volvo with the T6 engine. MSRP $62k. It had the features I needed, and good incentives and seemed to be the best bang for my buck. In fact my best negotiated payment ended up being within $40 a month of a similarly equipped toyota that I couldn't get any traction on negotating. My best lease offer for the volvo car locally? 53k cap, started at 671 a month with no deposit, i couldn't get them to move past $653/mo. To me that's not a good deal. They were marking up the money factor like crazy. I started contacting every dealership i could find. I found the same car, 2 and a half hours away, and i have worked them down to a 498 a month payment and the cap cost on the vehicle was still 53k. That's a much better deal.
$500 a month it would take about 9 years to own that vehicle @53k. At which point, many people would be seriously considering getting rid of that vehicle. If i loan the bank some money with fully refundable Security Deposits, i could get that monthly down another $50 to 450... now we're at almost 10 years to own the vehicle.
A little of the is is a PSA. If you're going to lease you have to negotiate hard and not be afraid to walk away. And if you negotiate right a lease could be a very worthwhile way to get a car.
Submitted May 05, 2019 at 10:57AM by I_LikeNiceThings http://bit.ly/2VLLd0T
