Quote:
Originally posted by 89911
You have to appreciate their honesty I guess. Anyone that buys a car and finances with little money down is always going to be upside down on the value/loan for most of the loan period. That is why I started leasing or buying a year or two old. If you buy a car and finance for 4 years you loan-value will be about equal in 3. If you lease for 3 years, you walk away from the car in 3 years also (granted your not a high milage user). The only difference is you payment with the lease is easily 25% or more cheaper on a monthly payment. I've never owned a car longer then 3 years (other then the 911), so if you can get over the "not owning" part of car leases, it make better sense financially. Sort of what this person is finding out.
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Here's my rules: If it has very high resale value, buy it new. Look for the incentives. Low APRs and lease factors can be the equivalent of huge rebates or discounts.
Leasing is smart. You only pay the sales tax on the payments you make, so on a short-term lease or if you bail after a short time, you haven't lost all the sales tax. Plus, if a leased car isn't worth the residual at the end (on a wholesale basis), walk away or you can often renegotiate the purchase option lower if you want to keep it (or sell it). If it's worth more than the residual and you don't want the car, sell it and pocket the difference. It's a win-win situation. And (I believe) leased cars generate better tax deductions if the car is over a certain value.