I was originally going to buy a used 2003 TL but shoot ...

why not just lease one then buy that one after the lease like i was going to buy a used TL, but at least i know whats its been through.

The payments was too much to buy right now, and if anyone thinks this is just way too bad of an idea, I'm back to the used TL or a new Camry (need the space).

If its not a bad idea.. what should i know before going to the dealer.

mark.

 

Welcome to the forums . I don't know much about this - but I would have to GUESS it would be a bad idea to lease then buy out. You will pay your lease payments for 36-48 months, then have to take out a loan to pay off the buy out amount for another 2-5 years - unless you will have the cash to pay it off...? But, that is a LONG time to have to pay off a car.

 

If you intend to buy, it is better to buy outright.

 

If you lease and then buy it out you will wind up paying more then if you just bought it outright. I wound up paying way too much for my last truck.

 

I agree . It is bad idea. You will end up pay more.

 

In the end, yes you will 100% pay some more... But you also get your car for a test ride that you did 100% of... Who knows, you might not like it, or might like something more in a few years. You can decide then. Shoot, the resale is so good (or should be) on the TL's that I may buy one after lease even if I dont plan on keeping it and selling it to make a few bucks!

 

Just get a 72 month loan, your payments should be about the same as leasing and there's some pretty good deals out there right now on 72 month loans (under 6%).

 

72 months!!! with like nothing down you are still upside down on the loan for years. If they are willing to write everything in, including sales taxes and doc fees. In ma a fill cash deal would add over 1500 more to the loan so you would easily be borrowing like 34000 bucks. If you cannot swing the 4 year deal, I would say buy something much cheaper for now and wait till you have something to put down before you buy a car like this..

 

ANY TIME you LEASE you are RENTING, PERIOD. If you want to rent something and then buy it, this might be a good option for you. A better rule would be that you buy only what you can afford. If you can not afford to buy today, then pick a used car or a different car that is in your price range. An unscruplous salesperson will try to convince you that a Lease is the way to go if you can't afford but the ONLY thing he is looking after is his pocketbook. Leasing you a vehicle simply gives him more commissions. If you buy a used car (even from the same guy), he gets signiifciantly less commissions. DON'T be a fool, DON'T LEASE! The ONLY time a lease makes ANY sense is when it is an extremely high priced car (i.e. over $100K) and it is a HONEST business vehicle and you QUALIFY for 100% of the expense in your company. Of course, then your compnay needs to be grossing well over 100K in profit each year. Very few TL buyers have that kind of cash or business.

 

It's better than leasing then buying ... as long as you plan on keeping it, you're fine, and with interest rates as low as they are, it's really not that big of a deal. Just make sure to buy gap insurance (I got mine through Allstate as an add on to my insurance policy, not through the dealer).

 

Exactly!

 

That's exactly right. Borrowing money, to buy a luxury car, is not smart.

 

Yes it is true that you will pay more if you buy out after the lease. However, leasing was the only way I could comfortably afford to drive the TL and because I use it for my business I do get a substantial write-off on it at tax time. Then again, many lease companies WANT their customers to buy the cars at lease end and make very attractive offers for them to do so. They offered me my 2k TL for about $2500 under the residual cost without me even negotiating. It was a sweet deal on a pristine car with only 35k on it but I passed because I really wanted the 04. In any event, to each his own.

 

Leasing makes sense when you own a business or drive very few miles... Some people think that they will always have a car payment so they prefer a 36 month lease and always have new iron. Chances are they only do oil changes and nothing else. Yea I know hiperf tires can wear faster. But you get the idea.

And remember the leasing companies are not losing money on the deal. Not how they stay in business. It is better to buy affordable and then as you build more income, move up to a more expensive toy. If you ever get in the siutation where you still owe on a car or have to pay overages, you get into the cycle where they roll the additional amounts into the next loan or lease... That cycle is tough to get out of... and can lead to financial ruin for some.

I know some people that buy 45000 trucks nothing down etc.. last I heard their payment is like 900 a month...

 

Hmm... I was wondering how "Set in stone" that residual buy out at end of lease price was.... Interesting. Is this typical???

 

Bingo... 3 leases and oil so far only... This TL will need tires I'm sure... I too subscribe to the you'll always have a payment theory. All these OMG don't lease people... Keep in mind, and I've said it before, only 30% of you people will even have your car still the day that last payment comes. The car dealer/Acura makes money no matter what and we lose. PERIOD. Buy or lease. They win you lose. The ONLY way buying is serisously worth it, is if you drive that car into the ground. Most people DO NOT do that. Having a new car every few years isn't too shabby either.

Boggles my mind man... How the fOOk do people do it? I mean there are alot of 45k trucks out there. I could afford to buy the TL but chose to lease for reasons above, but I don't know how these people can afford trucks left and right... I'm certainly not rich, but I do OK... No 45k vehicle for me. I have friends with those trucks who make 25k a year. I don't know how they do it.

 

If you intend on buying the car, do not lease it first. It will result in you paying much more for the car over the long run than you would if you just financed it in the first place.

 

What the heck sense does this make, so since I can't afford to pay $30k cash for a car I should buy something cheaper? I'd agree with you if you were talking about buying a "toy", like an NSX, but to me the TL is not exactly an extravagence, sure it's nicer than what I need, but not overly extravagent.

 

I agree...

Everyone needs to keep in mind that the Buy Crowd versus Lease Crowd and the arguments generated could rival the Schiavo Live or Die debate.... I have always been amazed how much conviction have for their position.

Can't we all just get along?

 

lol but if you cannot afford it you have champagne tastes on a beer budget. All depends on the perspective you come from... a 17k new car will get you around probably not run through 17 or 18 inch tires... brakes etc. cost hundreds less to insurre and get 30 mpg avg not like 24.

excise tax is less sales taxes as well and I bet it will last 100+ k with no problem.

so nearly double that is an extravagence...

 

Dark - I generally own one of my cars clear (i.e. Pay cash for it day one). The other car I generally finance. This means one car payment. Even when I finance it, I pay a good chunk down and only pay no longer than a 48-month period. This equates to two new cars and less than a $500/month car payment. When I sell the car to buy the next one, I have significant EQUITY. Each person has their own style. It sounds like you don't mind renting as long as you have new stuff to drive. I can't think of a SINGLE millionaire that thinks that way (There are reasons they have that kind of cash. I don't... yet). It's short term vs. long term. Intelligence vs. ego, etc. The $45K truck's "can" make sense if you can write them off to a LEGITIMATE business expense (as I do) but even on those vehicles, you have to continue to use prudent fiscal responsibility. It's true that the first year $100K business deduction has been reduced (to $25K+) but it's still 100% better to put the $15K down on that trunk than it would be to pay it to Uncle Sam in taxes. You also get to reap the $25K+ deduction for your business in that same year. BTW - $15K down on a $45K truck equates to about what you probably paid for your TL...

 

Tell me if this makes sense: Say I lease a car I like, like a new TL in this example. If I lease for 3 yrs, then buy it back for a good price (negotiable), then instead of buying some used car I have no idea about and given that I'm getting a good deal why not just buy it? Obviously I won't always have a new car but did I cut my cost of owning the car while leasing it with low payments and having a nice low "used" car pmt after the buy back instead of buying a new and expensive car?

 

I think it depends on a few different factors. 1) The policies of the company itself. 2) The supply/demand factor of the used car industry at the time. 3) The determination of the company that they would suffer a greater loss by taking the car to auction. 4) The willingness of the dealer you take it to to buy the car from the company. Personally, I don't think it is as "set in stone" as many are led to believe. In any event, if I really wanted to buy the car I would ALWAYS attempt to negotiate the buy-out downward.

 

I think it makes perfect sense. You're getting a known commodity that you have already invested time and money to take care of. If you buy a used car you don't know who owned it, how it was cared for, and even if it had been in an accident.
(Those Carfax reports are not foolproof).

 

Hi,
I would like to add my input on this. As many of you said "it's better to buy it outright" that statement is in fact true. Prior to my Acura TL, I leased a car at $305/month without any money down. I did that for 36 months which totalled at $10,980. Then I had the option of purchasing the vehicle at residual of $12,500. If I had done that (assuming coming up with $12,500 in cash) I would be paying for a total amount of $23,480. If I finance it, it would be more than the amount. But in 2000, I was offered to purchase the car instead of lease for $18,700. Had I done that from the first place, I would have saved $4700....

( I leased in 2000 because I couldn't afford a 18,500 car as a student. )

 

So what % of most normal Americans can pay for a car day one with cash? Even a $20k car??? Very small percentage... If I had that money to dump on one thing at one time, it sure as heck wouldn't be for a car... that constantly depreciates. As you know, cars as a general rule are a bad investment. The house, investment and long term savings wise, is a much MUCH better bet. (Maybe your house is paid off too?) Perhaps you're just a bit more independantly wealthy than the masses.

 

Lol, sorry if someone already posted it and I missed it, but some people here seem to have a serious problem with the concept of depreciation.

Leasing a car and renting a home are 2 very different things. The building barely depreciates and the land appreciates, so, at worst, it's a wash and the market value stays the same--it is almost always a better option to own.

With a car, it is depreciating the same as if 33,000 worth of supplies are being used up.

A lease is simply financing the depreciation of the car through the lease term. Buying is financing the entire value of the car. This is why it's good to lease a car with a low depreciation rate (most Japanese cars); the TL happens to have a very good one.

In the end, most lease vs. buy scenarios come out the same, if not very close when time value of money, etc., is considered.

Not trying to sound condescending, as I'm sure many of you know all this, but some people get convinced of something and seem to be unopen to an assertions to the contrary.

ps, mainevent, your girlfriend is a cutie =)

 

I hear ya.... Look at it this way... Your "wasting" some money in the end, but you are gaining a helluva test drive to make sure you want it for a 100k vehicle, as well as having the piece of mind that it is DEFINATELY taken care of.

Bottom line... Is that worth a few grand to you? To me, it was... Ergo... Lease with possible consideration to buy afterwards. (I haven't decided either way... I'll let you know in a few years!) After all, that babied tranny YOU took care of is better than the one in the leased Accord I turned in last year whose carfax report is 100% clear. We'll see how much $ he saved at the end when he needs a new tranny down the road... (I didn't abuse it outright.... But I had fun!)

 

VERY well put... Car company/dealership wins 100% of the time. In the end, we're out alot of cash either way. Over $37k financed or leased and then bought, whats a couple grand? Falls out in the wash basically...

And more importantly... YES, she's smokin hot.

 

I went the lease route because of the cost. I couldn't afford to buy the TL. I like getting new things, so I'll probably want something new. I had a 2000 Monte Carlo before the TL and I wanted to get rid of it about 1 year before I got the TL. The reason I wanted so long was because the car was paid off.

I agree with the statements above that in the long run you are probably losing money by leasing and then buying, but for some people that's fine. If you can't afford it up front, just make it last longer.

I don't know what I'll do when my lease is up. I don't think they'll be a new model TL by then, so I may end up buying mine. I guess we'll see in another 27 months.

Joe

 

I like it when people tell you the typical cost of a new car or the avg car payment. Who cares. The sales people want to know how much a month to put you in that car. Peple buy that or use it as an excuse to justify somcething. If you cannot afford to buy it and pay it off in 4 years, then you probably should not own the car from bean counter perspective.

What's a couple of grand lol well.. If you play your cards right you can go down to the caribbean a couple of times... nice vacation, etc.

I would rather buy a car I can afford to pay off in 4 years than lease a car I could ot afford. At the end of the lease you will get a nice surprise. If the car is not perfect they will have some charges for you...

 

Well that couple grand to you for vacation is important to YOU... For some, they want the nicer car they can enjoy 24/7, not just a week of sun... This is truly a no-win argument for either side.

And end of lease... Honda is great (has been for me...) I've had 3, and never owed a penny. Shoot, I made $ from some scratches I got cash for that Honda didn't even care about at end of lease. Loyalty has gone a long way for me as well... As long as you don't rape your car, that surprise at end of lease can very easily be from driving away in a new car, as opposed to owing extra $$$.

 

what couple grand extra do you speak of?

there is a $500 or so "lease inception fee", but besides that, how do you guys figure a lease is a few grand extra.

once again, you are paying for the depreciation either way. if you buy, then the car's salvage value is decreasing. if you lease, you are paying for the depreciation outright. no difference. NONE.

the only other thing I can think of is a lease sometimes has a slightly higher APR, but often they give lease deals that would make it even to buying.

I am an accountant, but I love economics, esp micro, and take a look at the big picture.

If I had the time, I would make an excel file to show cash flows and depreciation that would prove leasing and buying are very similar, if not the same.

plus, the financing co. often charges no fee whether you buy or give back at the end of the lease. this means if the agreed-to purchase price named in the lease is less than the market value, you could buy and turn around and sell for a profit or keep and refinance.

if it is more or even to market, then just give it back. often they're pretty cool about dings I've heard.

 

From the math I worked out... The extra $ is from the finance charges associated with the buyout price... Meaning... If the buyout is 18k and you don't pay cash, you'll finance that 18k and the interest paid on that is the EXTRA $$$. Make sense??? Now if you pay her off, AND get it for under the buyout price, WHAM, good to go... Like you said, at worst, sell it and make some $$$.

 

That was my original logic.. i guess Doom878 said it better..

So.. am I hearing some people agreeing that its an ok idea after all?

~mark

 

If it was after a 3 yr lease it would only have close to 36,000 miles, 4yrs 48, etc. So if you can negotiate a good price, if you like the car, if you have the miles. The major flaw with my logic is all the IF's.

 

Have you looked at a 72 month loan? I think you'd save money by avoiding the lease inception and lease termination fees that you sometimes get hit with, even if you purchase the car at the end of the lease, and I'd bet the payments will be pretty similar.

 

I have seen several people make this statement on this topic. The truth of the matter is that this is not exactly true. Both leasing and financing are types of leveraging that provide options on how to pay for a car. To say that "you will pay more if you lease" fails to take into account that when a person finances, they are financing the whole value of the car, while in most cases, leases only charge interest on the value being leased, which means it subtracts the buyout value. Taking into account the different interest rates that may be charged, and how you use the difference betweem the lease value and the finance value (such as paying off higher interest rate debt like credit cards) a lease may actually be an advantage.

In some cases, a lease is also easier to write off for tax purposes. But I am not an accountant, just an analyst.

So there are financial advantages to leasing in some cases. It depends on each individuals situation. Just my

 

Very good point.

 

Only flaw there is the "negotiable" concept. There is a reason that the leasing company has a stated residual value that is a component of the contract before you even own it. That is to make certain that there is no "negotiation" at some later point. Case in fact: You take out a 36 month lease but decide that you want to then "Buy" the car after 18 months. You only have one option. That option is to make all the outstanding lease payments and pay the residual value of the car as well. You do get a known commodity, but you also pay through the nose for the privlage.