One more question before we get the allroad. Lease, or buy?
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One more question before we get the allroad. Lease, or buy?
The '02 altas/platinum is on its way from NY. It has Bose, convenience, premium, rubber mats, cargo liner, mud flaps and the flat 17" wheels. Purchase price is $42,550.
I've never leased, since I tend to hold on to cars (and before the S4 they have all been in the low $20s). I can finance this myself through a home equity line. But the more I think about leasing the more I am intrigued.
36 month lease factor is .00265 ($690.00 per month, or $24,840 over the lease), or I can do a one lease payment at .00165 ($22,155.12) use my equity and get the deduction. Or I can buy it out right.
Other then deciding how long we will keep the car, what else do you think I need to factor into the decision? Something about keeping cash on hand during these times feels good.
Thanks...
I've never leased, since I tend to hold on to cars (and before the S4 they have all been in the low $20s). I can finance this myself through a home equity line. But the more I think about leasing the more I am intrigued.
36 month lease factor is .00265 ($690.00 per month, or $24,840 over the lease), or I can do a one lease payment at .00165 ($22,155.12) use my equity and get the deduction. Or I can buy it out right.
Other then deciding how long we will keep the car, what else do you think I need to factor into the decision? Something about keeping cash on hand during these times feels good.
Thanks...
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Joined: Nov 2000
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My $0.02...
It sounds to me, from information you have provided, like a lease would work out well for you. Basically treat the lease like a 36 month test drive. You know what your residual will be; you have the term of the lease to decide whether or not to buy the rest of the car for that value. When the lease is up, if allroads are selling below your residual, you can keep it or walk away. If the value is higher, you can buy out the lease, sell the car, and pocket the difference, or of course keep the car.
If the car develops substantial problems during the lease, or you decide you don't like it, you have spent the money for the use of the portion of the car (depreciation) that you consumed, which you would technically have spent during that time whether you leased or bought. However, if you think it's a fantastic car, you can pony up the cash at the end, and you will have had the use of that additional money during the term of the lease (for other investments).
I leased mine and so far, I'm thrilled with the "feeling" of leasing. I was concerned that I might not feel like I owned the car, but on the contrary, I don't worry about the car as much because I know that at the end of the lease, I can walk away if I want to. In the meantime, everything is covered, either by AoA or insurance.
Good luck.
If the car develops substantial problems during the lease, or you decide you don't like it, you have spent the money for the use of the portion of the car (depreciation) that you consumed, which you would technically have spent during that time whether you leased or bought. However, if you think it's a fantastic car, you can pony up the cash at the end, and you will have had the use of that additional money during the term of the lease (for other investments).
I leased mine and so far, I'm thrilled with the "feeling" of leasing. I was concerned that I might not feel like I owned the car, but on the contrary, I don't worry about the car as much because I know that at the end of the lease, I can walk away if I want to. In the meantime, everything is covered, either by AoA or insurance.
Good luck.
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Yes, but at the end of the lease you have ... nothing
No equity, which bothers some people. You pay your termination fee ($400-500) and have nothing to show for three years of payments.
Of course, you also had use of a very nice car for three years and can now get something else. Needless to say, dealers LOVE leasing. Gets people into cars they can't otherwise afford, and almost guarantees they will come back in 36 months and lease something else. A vicious cycle.
Of course, you also had use of a very nice car for three years and can now get something else. Needless to say, dealers LOVE leasing. Gets people into cars they can't otherwise afford, and almost guarantees they will come back in 36 months and lease something else. A vicious cycle.
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That's always been my logic, but...
after 3 years is this the car that the wife will want to hold on to, and I will be making quite the commitment to the 2.7T. How will it hold up in the long run? And it seems that the number of years to break even is now past 5.
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You are so off base - are you an engineer? Because from a money standpoint you have a Ton of
1. Money in your pocket, as you have used the car and paid out $1000's less that could be used more efficiently.
2. A used car that you know EVERY last detail about, including an exact cost with no hassle negotiation, if you want to buy it.
3. A car that if it sucks, you can give it back.
And if you did buy it, and tried to trade it, you normally get RAPED on the trade, so the equity you built is not really all there and is expensive.
Why not take the money you save, invest it wisely, or pay off credit cards.
There is nothing noble about having equity in cars. In fact it shows a lack of understanding of the fundamentals of finance, such as the present and future value of money, and cash flow.
2. A used car that you know EVERY last detail about, including an exact cost with no hassle negotiation, if you want to buy it.
3. A car that if it sucks, you can give it back.
And if you did buy it, and tried to trade it, you normally get RAPED on the trade, so the equity you built is not really all there and is expensive.
Why not take the money you save, invest it wisely, or pay off credit cards.
There is nothing noble about having equity in cars. In fact it shows a lack of understanding of the fundamentals of finance, such as the present and future value of money, and cash flow.
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car = depreciating asset, not the same as a house...
let's face it, we'll never make money on a car deal...
so why try?
I wish there were true "equity" in cars... the simple fact remains... how do you want to take the hit? quickly, up front (and in a major way- buying) or over a longer period of time (leasing)?
to me, the lease tends to take some of the sting out of the depreciation...
jmo.
dog = )
2001 A6 2.7T Sport
Brilliant Black/Onyx
17" BBS RC's
Xenon/Bose
so why try?
I wish there were true "equity" in cars... the simple fact remains... how do you want to take the hit? quickly, up front (and in a major way- buying) or over a longer period of time (leasing)?
to me, the lease tends to take some of the sting out of the depreciation...
jmo.
dog = )
2001 A6 2.7T Sport
Brilliant Black/Onyx
17" BBS RC's
Xenon/Bose