Pros and cons of leasing a car?

[6packofun]

We have had so many crappy, old, used vehicles.  (Not always starting out that way, of course.)  Never new, which is fine, but we've really put our AAA membership to its full use.  LOL  Stranded way too many times for my liking.

 

What are some reasons that leasing a vehicle would be preferable to buying?  If we don't put more than 15k miles per year on our vehicles does that change the equation?

 

It has been really nice not having a car payment for several years, so the idea of buying/leasing is already scary.  But we MUST get another vehicle within the next 6 months and I'm pretty sure we can't save enough to buy a decent used car outright.

[Arcadia]

A family friend leased a Honda Accord a few years back.  For them the pros was that

- they didn't need to worry about maintenance, 

- if they get a lemon they can just go back to their local dealer and get a replacement,

- the lease payments were similar to car loan payments for a new car,

- they didn't know how long they would be outstation in California so they didn't want the trouble of selling their car when they go back to their home country.

 

Lease agreements may differ by dealers even for same car brand so that is something to look into.

[hornblower]

IMO the only time leasing makes sense is if you can write it off as a business expense. 

Then the pro is that it's a write off & you don't have to worry about caring for/repairing a depreciating asset. 

 

Otherwise, it's all con in my books, with the main one being : you don't own the car. Making loan payments at least goes towards an asset you will own clear at the end. 

 

[AmandaVT]

I was very against leasing for years and finally ended up leasing a car in 2012 and I've been so happy. Our cars were old and crappy (but paid off) for years, but we ended up paying a ton in maintenance and repair costs. Thousands a year and we still had unreliable cars. My breaking point was when my aunt passed away and we didn't have a reliable car to drive to her funeral. We had to quickly rent a car, which cost a ton, and it sucked. We made the decision that it was worth us to have a monthly payment in order to be able to drive the 5 hrs to see family more often. We hadn't been going to visit because of the car situation prior to the funeral either and it was getting to be too much. 

 

So I leased a Subaru Forester for $200/month. About 2 1/2 years into my 3 year lease, the guy who sold it to me called me and asked me to come in and trade it in. He wanted me to pay $2000 down for a newer car and the same car payment. I laughed at him and said "it's a week before Christmas, I don't have an extra $2000 hanging around". He tried $1000, same answer. Finally he said he could get me into a new Forester at the same monthly rate, no money down and he'd throw in all oil changes and maintenance for the life of the new least. OK then. So I got into the new car and have been very happy. I wouldn't be surprised if I hear from him again next year about getting into another new car and for me it's worth it. 

 

About the same time as I got that second lease, my friend bought a nice used car for $10,000. She took out a loan from the bank - low interest. Her payment is $100 more a month than mine and her car is having pretty big repair issues already. So on top of paying more per month, she's now also having to invest in her car that she still owes money on. 

 

For me, for where we are right now, a lease works. 

[Tess in the Burbs]

Dh and I leased a car after college before we could afford a newer car.  We were able to get a car we normally couldn't afford. I know we were close in the miles, but the cost going over wasn't crazy.  At the time, it allowed us a new vehicle that we wanted.  No regrets.  It served our needs for those years, and it was about 3 years later we needed a larger vehicle, so we bought at that time.  

[marbel]

I was always very much against leasing.   But then we needed a new car, immediately.  A local dealership was running some leasing deals.  My husband ran the numbers on leasing, buying new, and buying a not-too-old used car.  A cheap beater car was out of the question:  we had been dealing with unreliable vehicles with high repair bills for too long. I was sick of that (literally at time, because of the stress).  He said there was no question that the leasing came out to be a better deal financially.  We expect to buy out our lease (or whatever the term is) at the end, but we have a couple years to go so we don't know for sure yet.  

 

It really depends on the contract.

 

Now, one con:  I regret not buying seat covers. The upholstery is a light fabric; it shows everything and does not clean well.  If we end up turning it back in we will get it detailed first, but even then I'm not sure we won't get dinged for it.  We are not slobs, but sometimes it works out that we eat and/or drink in the car. 

[abcmommy]

Leasing makes more sense than people think.

 

1. you are basically paying for a new car and no depreciation.

2. no repairs usually so no surprises

[J-rap]

Leasing was a great option for my dd and her dh.  They just moved to the U.S. after living several years abroad as students.  They moved to a state where the winters are terrible and they really needed a reliable car, plus my dd had to drive 30 minutes to work each day.  They couldn't afford a new car and ones they could afford had so many miles on them that repair costs would inevitable.  They had no savings really, just two new jobs (for the first time after university) and a tiny apt.

 

Leasing a brand new car for under $200/month was a lifesaver for them.  My dd can get to work safely and reliably, and they can deal with the monthly payment.  Any needed repairs will be covered.  Her dh uses public transportation or his bike.  They could have gotten a very used car with the little money that they had, but repair costs would certainly kick in at some point.  After three years, they might be able to get $500-$1000 for a used car, but not much more.  

 

It really does seem to make sense in their case to lease.

 

 

 

[Arcadia]

Now, one con: I regret not buying seat covers. The upholstery is a light fabric; it shows everything and does not clean well. If we end up turning it back in we will get it detailed first, but even then I'm not sure we won't get dinged for it. We are not slobs, but sometimes it works out that we eat and/or drink in the car.

My friend did not get dinged for the mess her then toddler made when they returned the car. They leased for three years I think. She was in SoCal. I think the dealer assumes some wear and tear and mess.

[Sharon77]

For the same car, you will pay less to lease.

 

Down payment and mileage is negotiable. I love leasing because I like new cars. So very reliable and freeing to not worry about maintenance. 

 

True, I don't own the car, but any car I've own, repairs and ownership costs start mounting at year 5 anyway.

 

I would highly recommend without exception that you lease Japanese cars, not American. The Japanese cars have such a high resale value, they WANT to get the cars back. They tune it up, give it a dealer certification and charge a new buyer a ton of money! I've never had a problem returning my Hondas and Toyotas. Even if they are a bit dirtier and one had a ding and another I was over miles. No charge for any of it cause they wanted it back and wanted to get me in a new car. 

 

I've also leased a Dodge Caravan and a GMC suv. Both were horrible to deal with. Because those cars have poor resale value, they tried to milk me for every little thing. It was so bad, my dodge, I just sold it on my own and paid off the car instead of returning it.