Anyone use lease swapping sites before?
- Thread starter bofa
- Start date
Register to hide this ad
bofa
New member
Yeah i found another forum that's all about leasing and was able to find some experiences there. Seems like they are good for the most part. Im debating if i want to keep this Jeep as an extra vehicle or let someone else take the lease. Relatively low payments and a good residual. Based on my projections, it will be in the green about 3k when the lease is up. Im getting the 4R itch so buying sooner than planned and not in the green just yet.
BrianSD_42
New member
First rule of leasing is don't get a lease. Unless you own a personal business there is little benefit and even then you are probably still getting screwed.
Sorry I don't have better advice for you. For the next guy .... Don't get a lease.
Sorry I don't have better advice for you. For the next guy .... Don't get a lease.
Beaumont67
New member
^^ Exactly, unless one wants to be in :ballchain:
Even with a personal business, Leasing didn't make any sense...very bad option here.
A year ago, our son bought a brand new 2015 Lexus RX350...and he co-owns a business.
- for shits & giggles, I asked salesman for a lease price first
- just to show our son, the base price of luxury vehicle renting
- I was honest with salesman, and said I could never be talked into a lease, but give me the $'# anyway
- SUV purchase wasn't my final decision to make
- I just want to discuss with son, to begin the buying process...have some ammunition, to plead my case
48 month lease price was in the mid $1,300/month...like WTF >>.
Son & Dad finally negotiated a direct buy price, which was $75-80/month cheaper (over 48 months)...equals additional $3,600 in savings
Lets make a Deal, 13.3% off MSRP - see post #21: http://www.toyota-4runner.org/off-topic/231408-new-vs-used-2.html
After 1 year, he logged 40,500 Km - on the lease option, 25 cent surcharge for mileage over 25,000 Km. is charged back
- so yearly he would be in the red, an extra $3,875 or $15,500 over 4 year term / equals negative equity
Buying instead, he will have +$35,000 of equity (in trade-in value), with zero mileage penalty's & slightly cheaper monthly payments.
- Net Buy cash flow gain, in 4 years = $35,000 + $3,600 + $15,500 = $54,100 ...with lease, son would almost have paid for new Lexus twice
Last edited:
A.Wilson013
New member
I hope you're right about that $35,000 in equity. Down here most 4 year old RXs are listed at or under $30,000. I don't even want to know what they're "giving" people on trade-ins.
Regardless, even if they gave him $15,000 for the trade, that's $15,000 more than he would have been able to extract from the lease.
13.3% off MSRP isn't bad (our local dealer is now a "no haggle" dealer which sells their cars typically around 3%-5% under)
When we got our IS it was the last month of negotiations and I capitalized on it by making Lexus of Seattle and Lexus of Bellevue fight for my business. It took much longer than 2 hours- closer to a week - but we were able to get a couple thousand under invoice and even at that price, Seattle offered to beat it. But, with the dealer add-ons and close proximity to home, we went with Bellevue.
Did your son consider an NX? We had one for a loaner for about a week and it was a week too long. I don't know how Lexus was able to so much torque steer out of a 4 cylinder vehicle with AWD.
Last edited:
JayceeP
New member
[MENTION=134828]Beaumont67[/MENTION], I doubt you'll have a $35,000 RX if you're putting that kind of mileage... that's 160,000km after 4 years! I've been looking at 2013 Lexus RX's (touring package) and if they have anywhere near 100,000km you have dealers asking $28-29k for them in Montreal and even NB. About $30-$33k for ones under 75,000km.... and we all know those prices are negotiable. Toronto is a bit more expensive. But, if the dealer is asking that, you are getting less either on a trade or private sale.
Anyway.... The numbers aren't that bad on a lot of vehicles for leases. You're paying depreciation plus interest and have an easy exit at the end of the term. It could be a "cheap" way to get in to a vehicle up front and then buy it out at the end of the term if the numbers are right. I've never done a lease but I considered it for the wife on a new RAV-4. Anyway, we're on the Lexus RX train now but it will be a used 2013.
Anyway.... The numbers aren't that bad on a lot of vehicles for leases. You're paying depreciation plus interest and have an easy exit at the end of the term. It could be a "cheap" way to get in to a vehicle up front and then buy it out at the end of the term if the numbers are right. I've never done a lease but I considered it for the wife on a new RAV-4. Anyway, we're on the Lexus RX train now but it will be a used 2013.
Last edited:
Beaumont67
New member
A.Wilson - my used car dealer friend is getting $15,000 for 8 year old RX350's, when he get a clean one at auction.
So a mint & loaded 4 year old one with touring package - Navi, leather mouse, lane detection, etc, will bring +$30K.
- so $35,000 estimated value might not be that far off / a private sale will overly exceed $15K, in 4 years time
Last year I privately sold a 2008 Nissan Rogue SE (only RWD) with high miles for $7,700...I was offered $4,000 for it, almost double.
- so I am confident, sons used Lexus will hold some decent value, in 4 years
- and ROI will be even better, considering purchased new at 13.3% off list price
Re - The 2015 Lexus NX is an all-new compact luxury crossover set to go on sale in December. It is a smaller, sportier alternative to the existing Lexus RX midsize SUV. ... The Lexus NX 200t will make up the bulk of NX sales and is the first vehicle to get Lexus' new turbocharged 2.0-liter four-cylinder engine.
^^ My wife drives a 2008 RAV4 Limited, 3.5L-v6 & its a rocket ship.
While the NX is a glorified RAV4 in wheelbase, a 4 cyl. turbo will not out perform or out last a non-turbo v6 IMO.
- since mom & dad always buy used vehicles , usually without warranty / the world production v6, is proven & more desirable
Plus - wife will probably gets son's RX or Highlander, in 3 years...an upgrade and still has the v6...so no turbo to rebuild & extra maintenance costs
JayceeP - I asked Lexus salesman why the lease monthly payments were higher than our out the door purchase price, with 3.9% Lexus financing?
- while presently surprised, he had no answer / didn't make any sense, other than more business write-offs
- but my son drives into Toronto on business trips, and racks up the Km.
- getting mileage penalized $15,500 (estimated over 4 years) puts the lease option in the can
And my sons cheaper monthly payments, also included principle, interest & tax.
- so in 4 years, his Lexus still has trade-in value, in his owned "depreciated asset" / vs. assuming reverse equity Leasing
Last edited:
A.Wilson013
New member
I disagree with this.
It doesn't matter if you own/finance or lease a vehicle. At the end of the day, you can add it all up in terms of total ownership cost, and for most vehicles, the largest component of overall cost is depreciation. Everyone pays it, regardless of whether the vehicle is financed or leased.
Depreciation becomes less expensive over time as the the curve flattens out, but even if your vehicle is paid for and you sleep at night with the pink slip in an envelope underneath your pillow, you're still paying depreciation. My 13 year old 4Runner is depreciating approximately $100-$150/mo. I could lease a Hyundai Elantra for that (not that I would, but I could). Older vehicles also require more maintenance and repairs which are often covered under warranty if they were newer, leased vehicles.
Lastly, like everything else in life, it comes down to negotiation. In a previous life, I leased a BMW 335i. Did European Delivery and got a smoking deal on it. When the 24 month lease was up, it was December 2008 and the world was in the throes of a financial crisis. BMW didn't want the car back. They sold it to me for $9,000 under the residual value and I drove it another six years.
Other potential advantages to leasing:
Sales Tax: A buyer who finances a new vehicle (at least in the state of California) must pay sales tax on the full purchase price of the vehicle. It varies by county but in CA, it's about 8%, so for a $40,000 vehicle, that's $3,200. Most people will typically roll this into the loan, but the state expects it all up front before you get your license plates. On the other hand, on a leased vehicle, sales tax is only paid on a monthly basis, and even then, it's only paid on the amount of the lease, not the residual. Suppose the buyer trades the vehicle in after 3 years with a trade-in/residual value of $25,000. The lessee only pays tax on the lease amount ($40K-$25K=$15K*8%=$1,200). The buyer who financed/bought vaporized $2K more to the government compared to the buyer who leased.
Opportunity Cost: Suppose a buyer finances a $40,000 vehicle and puts $10,000 down on it. Compare this to a savvy leaser who gets a good deal with a $0-own/$0-cap cost reduction lease, where the drive-off is typically no more than DMV + 1st month's payment. If a lessee did this three years ago and put that $10,000 into a S&P500 index fund ETF rather than a down payment, it would be worth $15,000 today.
Sales Tax: A buyer who finances a new vehicle (at least in the state of California) must pay sales tax on the full purchase price of the vehicle. It varies by county but in CA, it's about 8%, so for a $40,000 vehicle, that's $3,200. Most people will typically roll this into the loan, but the state expects it all up front before you get your license plates. On the other hand, on a leased vehicle, sales tax is only paid on a monthly basis, and even then, it's only paid on the amount of the lease, not the residual. Suppose the buyer trades the vehicle in after 3 years with a trade-in/residual value of $25,000. The lessee only pays tax on the lease amount ($40K-$25K=$15K*8%=$1,200). The buyer who financed/bought vaporized $2K more to the government compared to the buyer who leased.
Opportunity Cost: Suppose a buyer finances a $40,000 vehicle and puts $10,000 down on it. Compare this to a savvy leaser who gets a good deal with a $0-own/$0-cap cost reduction lease, where the drive-off is typically no more than DMV + 1st month's payment. If a lessee did this three years ago and put that $10,000 into a S&P500 index fund ETF rather than a down payment, it would be worth $15,000 today.
BrianSD_42
New member
Maybe you got a good deal on a lease.
But the fact is most auto leases are not simple and understanding the TCO over 5 or 7 years, assuming of course that you bought the car at the end, is actually quite hard to decipher.
I would even go as far as to say that they purposely write them so that most people can't understand the true TCO.
What is easy to understand is using Truecar.com to see the best price on a new car, getting 0% or 1.79% over 60 months and then keeping the car for 5 full years and selling it.
And finally if leasing was actually a good deal, normally at least, then when is everyone trying to swap them around or get someone to take them over vs just buying the car out of the lease before it ends? You can sell the car at any time. It's a simple fact. If there REALLY was a buyer with cash to pay off the lease and ALL THE FEEs then Lexus, BMW or whomever would allow it. I know because I almost bought a leased car from someone once.
But of course when you add up all the fees and everything else it actually looks like a hole in the ground and no one wants to buy it that way. Btw your comment about taxes is really an aside because you are still going to pay most of them anyways if you buy it after 3 years, you just deferred the cost and avoided about 1/3 of the taxes.
But the fact is most auto leases are not simple and understanding the TCO over 5 or 7 years, assuming of course that you bought the car at the end, is actually quite hard to decipher.
I would even go as far as to say that they purposely write them so that most people can't understand the true TCO.
What is easy to understand is using Truecar.com to see the best price on a new car, getting 0% or 1.79% over 60 months and then keeping the car for 5 full years and selling it.
And finally if leasing was actually a good deal, normally at least, then when is everyone trying to swap them around or get someone to take them over vs just buying the car out of the lease before it ends? You can sell the car at any time. It's a simple fact. If there REALLY was a buyer with cash to pay off the lease and ALL THE FEEs then Lexus, BMW or whomever would allow it. I know because I almost bought a leased car from someone once.
But of course when you add up all the fees and everything else it actually looks like a hole in the ground and no one wants to buy it that way. Btw your comment about taxes is really an aside because you are still going to pay most of them anyways if you buy it after 3 years, you just deferred the cost and avoided about 1/3 of the taxes.
Last edited:
Leasing is very simple once you take a few moments to understand how it works. Many people don't and they get taken to the cleaners but that doesn't mean you or I have to.
Again, it comes down to depreciation. Unless it's an '85 4Runner or a '95 Porsche 911, a vehicle will depreciate in a predictable manner and it will do so whether it's financed, leased or purchased outright. Occasionally manufacturers will offer promotional rebates and other programs that subsidize lease programs. BMW is notorious for it. The end result is a lease payment that's less than what the vehicle is actually depreciating by. This is a victory for the consumer. The BMW I mentioned in my previous post is an example of this.
Need a cheap commuter? How about a Chevy Cruze for $118/mo out the door? Factor in fuel economy savings compared to my V8 4Runner and I could damn near add this to my stable for free.
https://leasehackr.com/blog/2017/1/16/january-wonder-lease-the-new-chevrolet-cruze-109-month-0-down
Again, it comes down to depreciation. Unless it's an '85 4Runner or a '95 Porsche 911, a vehicle will depreciate in a predictable manner and it will do so whether it's financed, leased or purchased outright. Occasionally manufacturers will offer promotional rebates and other programs that subsidize lease programs. BMW is notorious for it. The end result is a lease payment that's less than what the vehicle is actually depreciating by. This is a victory for the consumer. The BMW I mentioned in my previous post is an example of this.
Need a cheap commuter? How about a Chevy Cruze for $118/mo out the door? Factor in fuel economy savings compared to my V8 4Runner and I could damn near add this to my stable for free.
https://leasehackr.com/blog/2017/1/16/january-wonder-lease-the-new-chevrolet-cruze-109-month-0-down
BrianSD_42
New member
Well that does sound like a good deal
