Hammo

Just wondering if anyone has ever took out a lease agreement on a vehicle in the USA rather than buying it outright? If so, is it worthwhile or should I steer well clear?

I've been thinking about doing a lease as the monthly payments tend to be much smaller than a finance loan over a 3 year period. I'm aware that you have a mileage limit etc but this seems like a good way to drive a newer vehicle for a few years and not incur a massive debt in the meantime!

Cheers
Andy.

Bob

Depends on the motor and how much milage you get out of it...the in-laws lease a saab and works out cheaper that why as they don't have to maintain it and now the the missus ain't in college, they don't drive it that often so it works out well, but FIL bought his pick-up as that was a lot cheaper, but then he puts loads of miles on it and gets a new one every couple of years as there well knackered by then.

Thing to work out is the depreciation of the motor if you bought outright v that of lease costs...

AdobePinon

Really depends on how much you want to keep changing your vehicle. Personally I wouldn't do it - I drive too many miles and plan on keeping my car for quite a while. Looking forward to driving many years without a payment. And you must be racking the miles up in Wyoming, surely.

Works for some people though. Be sure to read the lease carefully - can be some nasty fees at the end of the lease, especially if you don't go the distance on it.

fatbrit

Read and inwardly digest here.

Englishmum

You could perhaps consider 'assuming' a lease; taking over a short-term lease where the original lessee has to give up the car - maybe due to getting into financial difficulties or moving out of state or overseas - and they've already made the original 'down payment' so you don't have to:

http://www.swapalease.com/

http://www.leasetrader.com/e/home.asp

Sentosa

DON'T DO IT. We did and they get you all ways. We wanted to give up the lease 3 months early and willing to pay up the 3 months lease, they wouldn't let us, unless we agreed that if the auction price they got for the car was under $10,000 we would pay the rest up to that figure. So we kept the car, the dealership were we bought our new car advised us to have it resprayed in the same color as some one had scratched it with keys. So we had a respray for far less than the lease company would have charged. When the lease date was up we took the car to the place were we'd leased it. I had the foresight to take photo's all around the car, mainly because we had ,had one hurricane through and another was coming in that weekend, and didn't want to be charged for damage that may have happened on the car lot. A month later we got a bill from the lease company to tell us that there were lot's of dents on the car and we would have to pay,I called them and asked them to send photo evidence, and was told the car had gone to the auction and the auciot house had informed them of the dents.I told them I had an inspection form from the guy at the dealeship stating it was o.k and well under the mileage., and that I had photo's still in my camera with the date and time taken on.
I e. mailed them to the lease company and have heard nothing since.
When we first came over we bought a seconed hand car and kept it for 4 years without a problem, but we got it from a reputable dealership.Most of my american freinds have hit the same problems with the lease companies. Sounds very good at the time but it's like insurance , you don't know what you've got 'till you make a claim.

BritGuyTN

steer clear

leasing unless you are self employed and can write some of it off is a big con and a great profit center for the car dealer

yes, the payments are smaller, but thats because the dealer is building equity - not you

if you find that the car you like is only affordable by leasing then the bottom line is that you are probably living beyond your means

my suggested plan:

either borrow or buyer a banger for 6 months

set up a couple of secured credit cards with banks like bank of america

when you experian credit score is 660 or above go to www.patelco.com

get a used car loan at 4.2%

buy a 2 -3 year old car

live happily ever after whilst not having to deal with horrific depreciation and being 'upside down' on a loan on a comparitively shit car (compared to euro cars)

Manc

leasing = fleecing

Hammo

Right, some interesting (and scary) stories about the whole leasing thing. I'm going to give it a big miss as it really does sound like a big con.

I'm on the way to getting good credit and luckily my sister-in-law does the financing for the biggest car dealership in town so when we finish making the payments on our Jimmy in a couple of months, I'll probably trade that in and get a 2003 model with low mileage. We're currently paying $350 a month so there's no reason why we can't continue with that amount.

Thanks to everyone who took the time to reply on this. I'm really glad I asked the question before taking the plunge!

Manc

good idea. seems crazy to only lease a car, as you'll never own it.

I have a 4 year old Nissan Altima, nothing special. but costs us $220 per month. and gets us from A to B just as well as anything else.
and in 18 months, it is ours.

ten66

Hi Folks,

I also have been looking at this method of obtaining a vehicle once I am in the States. One of the attractions of the US to me (as a car enthusiast) is that I can get my hands on some beautiful big motors.

I have read all the downsides to leasing (and had already figured out many of them). But are there any positive aspects to leasing? It makes sense to me to pay only for the portion of the car you will use whether you will own it or not. Indeed, it makes no sense to me to own a perpetually depreciating item when your money tied up in that vehicle could be used better elsewhere. Taking out a loan only makes the matter worse, IMO. With leasing you can obtain a new, reliable, car more often at a lower monthly payment.

So long as you keep up the payments and abide by the conditions of the contract - and you know what the inherent downsides are to the whole process - then I think it is certainly an option I will consider.

Now that's gone and done it....

Simon.

Manc

I don't think anyone is gonna knock you though if that's what you want.

me personally can't see the attraction of having say a huge SUV looking thing if you're only allowed to drive it 12,000 miles per year

Bob

but like I said earlier...it does work out if you don't drive that often, MIL only really uses it her car to get to school and do groceries, so really doesn't do more than 13K miles a year, and with the lease, the garage does the checkups and all they have to pay for are getting winter studs on and off...so it works out a lot cheaper that way, and then after a couple years can get a new car with a different colour or whatever

Doesn't work for fill though, but then after a couple years of using the pick-up in the woods, it gets well knackered and has some serious milage put on it, so it works out a lot cheaper to buy outright and dump it every couple of years back to a dealer and buy new, that way it's covered under warranty and all that....plus it's a tax right off as a work expense

BritGuyTN

Please take my comments with a large pinch of salt

As a car enthusiast you should probably stay away. the cars here are shite. many of the jap cars here are made cheaply and are completely different to the rest of the world (US Accord is a pale comparision - the euro one is sold here as an accura). the german cars are often lower spec, lower power and in some cases have been ruined by putting on a raised and softened suspension for the US to comply with safety measures here

Yes - if you are self-employed you can write off a proposrtion of the leasing cost

you are tieing up the banks money, not yours - thats what you pay the interest for

lower monthly payment, YES, Will it cost you more dollars across a three or 5 year period? YES.

I want to pay less for my car rather than more. thats why I bought a high-quality car a few years old with a low mileage. The original owner took care of $40k of depreiciation for me

If you MUST have a new car and enjoy throwing money away then lease.

if you like paying less money for the car and have a little bit of hassle buying and selling the car privately then buy outright with a loan

Bob

you knacker the car on something that isn't covered in the lease, your screwed, your cancel the lease, your screwed, you go over the milage, your screwed...those are the downsides to a lease.