Leasing a car
#1
Leasing a car
I was thinking about car leases today, and although typically I have had a bad view of them - I have been rethinking it.
I like the new BMW 3-series. If I want to get a 330i new pretty loaded, it would run me around 42-45k.
Assuming I were to finance it for 5 years, during the first 2 years I would pay around $14k. After 2 years, it would likely depreciate around $10-15k. Basically I would be paying off the depreciation.
Or I could lease it for 2 years, pay around $10-12k, and then get rid of it.
Plusses? Minuses? The longest I would keep the car is about 5 years before I sold it.
I like the new BMW 3-series. If I want to get a 330i new pretty loaded, it would run me around 42-45k.
Assuming I were to finance it for 5 years, during the first 2 years I would pay around $14k. After 2 years, it would likely depreciate around $10-15k. Basically I would be paying off the depreciation.
Or I could lease it for 2 years, pay around $10-12k, and then get rid of it.
Plusses? Minuses? The longest I would keep the car is about 5 years before I sold it.
#3
Originally Posted by TLover
The shorter you keep a car, the better a lease is for you. Your lease payment depends on:
1. Length of the lease.
2. The amount of miles you drive.
3. The resale value of the car.
1. Length of the lease.
2. The amount of miles you drive.
3. The resale value of the car.
Sweet spot for leases is between 24-42 months...typically 39 is the magic number. However, new models(like the new BMW) often have shorter lease specials because manufacturers want those cars back ASAP...while they're still 'hot' items.
Whatever you do...do not lease longer than 42 months. Once you pass 36 months, the benefit of a lease diminishes...in essence, you're buying too much of the car.
#4
If I lease, I would keep the car for 36 months/3 years.
If I were to buy, I would keep the car for 5-7 years. Less if it gave me serious problems and less if I just wanted something new (I am in my early 20s, very likely).
New 2006 BMW 330i.
Which is probably the best option for me?
If I were to buy, I would keep the car for 5-7 years. Less if it gave me serious problems and less if I just wanted something new (I am in my early 20s, very likely).
New 2006 BMW 330i.
Which is probably the best option for me?
#5
Originally Posted by Rumble
If I lease, I would keep the car for 36 months/3 years.
If I were to buy, I would keep the car for 5-7 years. Less if it gave me serious problems and less if I just wanted something new (I am in my early 20s, very likely).
New 2006 BMW 330i.
Which is probably the best option for me?
If I were to buy, I would keep the car for 5-7 years. Less if it gave me serious problems and less if I just wanted something new (I am in my early 20s, very likely).
New 2006 BMW 330i.
Which is probably the best option for me?
#6
Originally Posted by Rumble
If I lease, I would keep the car for 36 months/3 years.
If I were to buy, I would keep the car for 5-7 years. Less if it gave me serious problems and less if I just wanted something new (I am in my early 20s, very likely).
New 2006 BMW 330i.
Which is probably the best option for me?
If I were to buy, I would keep the car for 5-7 years. Less if it gave me serious problems and less if I just wanted something new (I am in my early 20s, very likely).
New 2006 BMW 330i.
Which is probably the best option for me?
Trending Topics
#8
I say, lease the best damn thing you can afford and enjoy life.
Once you decide you are getting married it's time to buy a car. You should definitely be in buy mode once kids are coming. Once you have kids you will see your car hit 100k and hope you get another 100k out of it.
This all assumes you don't have money falling out of your ass. If you do, then F what I just said.
Once you decide you are getting married it's time to buy a car. You should definitely be in buy mode once kids are coming. Once you have kids you will see your car hit 100k and hope you get another 100k out of it.
This all assumes you don't have money falling out of your ass. If you do, then F what I just said.
#10
Originally Posted by TLover
One thing to keep in mind: Your insurance will be slightly higher on a leased car because you're required to carry higher liability limits.
#11
Originally Posted by Shoofin
The major difference between carrying a 25/50/25, a 50/100/25 and a 100/300/50 (What lease banks require) isn't that much a difference. IMO, I'd rather have a higher limit anyways....
#12
Originally Posted by TLover
For me, it was about a 10% difference between what I had when I had a car on loan and a car on lease.
#13
In theory:
Lease a depreciating asset
Buy an appreciating asset
Lets add a condition for cars:
Lease a high residual car
Buy a low residual car (and keep it longer than 5 years).
A 330i should have a residual of around 58% after 3 years, which is very good. But be aware that they are gonna bank with them selling at MSRP as they are new.
The amount financed on a lease ~= (MSRP - Residual) * interest.
Also, the residual = residual % x MSRP.
If the sale price is below MSRP, the residual should not change.
Ideal scenario: Lease a high residual vehicle being sold @ invoice.
Lease a depreciating asset
Buy an appreciating asset
Lets add a condition for cars:
Lease a high residual car
Buy a low residual car (and keep it longer than 5 years).
A 330i should have a residual of around 58% after 3 years, which is very good. But be aware that they are gonna bank with them selling at MSRP as they are new.
The amount financed on a lease ~= (MSRP - Residual) * interest.
Also, the residual = residual % x MSRP.
If the sale price is below MSRP, the residual should not change.
Ideal scenario: Lease a high residual vehicle being sold @ invoice.
Thread
Thread Starter
Forum
Replies
Last Post
Zonian22
Member Cars for Sale
3
11-14-2015 01:20 PM