Icanrel-8

Ok, this is great! Now how about one more scenario just to make this scientific (or more confusing)-- could you now compare buying outright -say I plunk down 30 large and walk out with the 8. Did I do better than leasing AND financing 'cause I saved all that interest?

I know we will have to make some assumptions, like will I invest the interest money, etc. but I hear so many opinions on this, I'm not sure anymore.

boothguy

Assuming you're not going to do something else with the money, like make some great investment decisions, then of course you're going to be ahead by not paying the finance/lease charges.

Leasing makes the most obvious sense either for a company or for an individual who can write off a significant portion of the mileage for business reasons. But in the case of someone like CatchMe, leasing is definitely a way to drive more car than you could afford through normal purchase financing. Just be aware of the downside is all. And know how long you intend to keep the car before the lure of a new one gets irresistable. Otherwise, you'll get dinged pretty hard for getting out of most leases early.

I'm not sure where the $14k, 36 month residual number comes from though. The purchase price on my 8 was $31k also, but my residual (which is also a negotiable number in some cases) was about $18.5K after 36 months and 36k miles.

As mentioned many times before, leaseguide.com is a good place to start the education process.

TownDrunk

I've leased cars in the past (In fact, just leased a new MDX two weeks ago). I bought my '8 cash because the purchase and lease deals at the time (I bought in July) really sucked. They weren't really wheeling and dealing, and I had the cash. In my experience with leasing, it's important to understand the terms. Be sure the finance charge your paying is reasonable...

Forcing the dealership to work with you and the banks its likely that you can find a high residual and low finance charge that will yeild the payments you're looking for. Also, I don't "buy down" the payments. I look for driving off with as little down as possible. Sure, my payments would be a bit less if I pay more up front, but since the finance charge is fixed (unlike most autoloans where you pay interest on remaining prinicpal) whether I pay up front or with higher monthly payments, I'm still going to pay the same. Better earning what paltry interest my bank is paying on a couple grand in my account rather than the finance company's account.

Also, leases really only make sense (IMO) in the short term... 3 to 4 years max (depending on your needs), but shorter if possible (like 2 years). I generally look to see when the model is due to be redesigned... If it's within a couple years, get a shorter lease as the resale tends not to go down as much. If you lease a car in the last model year and it's redesigned the next year, chances are you're going to have a lower residual which results in higher payments.

Anyhow, as many have suggested, if you're not stable in your employment, or not sure what your family plans are, leases may or may not be a good idea, but I would say the same is true with buying a car. Nothing like financing a car for 5 years, and needing to get a new one after 12 months. Tell me you won't lose a bundle on that.

For me, I tend to lease because I get tired of cars after a few years. I get a new toy every few years, and I never, ever, under any circumstances will own a car that's not under warranty (except my '91 pickup that I use for truck duty when I need one). I have terrible... terrible... ridiculously crappy luck with cars and I'd be a fool not to have warranty coverage.

So, I did buy my '8, but I only plan on having it for another 42 months or 45,000 miles when the warranty expires.