Leasing a car with buyback?
 

Hi,

I am going to be in touch with International AutoSource and ExpatRide to get a car. At the moment i am not sure how long i am going to stick around, so was wondering whether leasing will be a good option rather than buying the car.

What options do i have in leasing a car:
1. Is it possible to break a lease by returning the car back?
2. If I want to buyback the car at the end of the lease, how is the cost determined?
2. Is it possible to get a lease without a fixed mileage?

Thanks

Re: Leasing a car with buyback?
 

Anything is possible - the real question is how much money each option will cost you ...

Re: Leasing a car with buyback?
 

1. As far as I know, generally not, but I am not certain, and may be wrong. Given the steep initial (instantaneous) depreciation, the lessor is unlikely to be happy with a six month old car and only six months of lease payments.

2. I think the end value is usually stipulated in the lease. At the end of the lease this may or may not be a good deal for the lessee, because one of the effects of the lease contract is to shift the risk (variability) of depreciation from the lessee ("buyer") to the leasor. If the car is a mechanical basket case, with accident repairs, and is a discontinued model, then the stipulated price may be too high, though lessors are likely to be conservative and over-depreciate to reduce the risk of being left with an under-value vehicle.

3. No, this is not possible. The mileage is a major determinant of the final value of the vehicle at the end of the lease. If the lessee was living far from his place of work and commuting 160 miles a day, and therefore putting 50,000 miles a year on the vehicle, it would obviously be worth massively less with 150,000 miles on it at the end of three years than if it had, say, 36,000 miles on it. The lessor needs to be reasonably certain that the lease payments cover total costs, including depreciation, so a mileage cap and excess mileage rate is a necessary part of the lease contract.

Re: Leasing a car with buyback?
 

You can break the lease, but don't expect to just turn in the car and stop paying payments. You will owe money but how much will depend on the lease.

As said, it in the initial lease contract. Its usually a stupid price when you take the lease payments and original car cost into account.

Technically all leases are unlimited miles. You get a pool of free miles but you are able to drive as many as you want as long as you don't mind paying. You can get leases with very high allowances but they will be a lot more than low mileage leases.