Lease or Buy

[MkUrMark]

Hey guys, I know there maybe some lease vs buy threads but I like to read your thoughts on my predicament.

I recently received a good offer on a 2016 SPB w/ Tech, Led, Black Optic Performance, B&O package with many extra goodies msrp @ $51,860 for $45,700+tax,license etc.

The dealer told me its my option if I want to lease or buy at the sales price...

Heres the Lease offer

$2,500 Down Payment
36 Month Lease
25,000 Miles per year
$624 Monthly Payment plus tax

vs

Buying

$4500 Down
72months 3.49%
691 Monthly


Within the last 10 years of purchasing cars I have never leased but I usual tend to keep my cars for no more then 2-3 years. I usually finance them on 5-6 year terms and
I tend to put on avg of 25k miles a year(for work purposes).

The biggest reason why I trade them within 2-3 years is because once I break 75k mark maintenance starts out weighing long term ownership IMO. I hate making payments with lots of maintenance bills pilling up.
For example, at the moment I own a Golf R @ 86k miles needs a new clutch soon and timing belt service.

Thats why for first time I am highly considering leasing.

I love to read your opinions... I know once I hit 75k on my next car the cycle will most likely begin. Unless a get an extremely boring car Jap car

[fhwang]

My 2cents is since your primary concern is cost of maintenance especially since you're planning on driving 25K a year....lease it! Modern cars are just so expensive to maintain after the warranty ends. Oh and you got a decent deal on the lease option especially with 25K miles lol.

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[MkUrMark]

Thats were I feel my buck stops sorta of speak. I usually only heard of lease terms 10,12 or 15k. I never knew an option for 25k. At the moment my Golf R has 86k miles 3yrs and 4months. If it wasn't for the high maintenance I probably keep it over 100k, its been a good car to me, despite some of the corky stuff that comes with owning a German car.

[kdaffy]

i would also lean towards leasing, but the interest rate on the loan you were offered seems a bit high (maybe 1% too high), so you could bring down your payment somewhat materially if you negotiate harder on the rate or shop around for a better one. then you would "own" the car for a lower monthly payment, not be concerned about the miles you put on it, and if after the warranty expires you could trade into a new model to avoid your maintenance woes...

out of curiosity, what is a SPB? (sorry if its a dumb question)

[mjfloyd1]

Keep in mind that the upkeep bills are still the same after the factory warranty expires. I'm not sure if a extended warranty would make sense, but I doubt it.

With the payments being lower and for half the duration (and also a little more than half the down payment), I would lease it.

[RingNut]

The issue here is mileage. If you never keep a car more than half of a purchase term, you are essentially leasing it, the bank still owns the car.

You lose money either way, but since you have to add the sales tax in on a purchase, you are paying way more. On a lease, you only pay sales tax for that month. So, if you lease a car and trade it in early, you are better off than if you bought the car and traded it in later with higher miles and more depreciation since sales tax ads to the cost but not the value.

Based on your numbers above, the price you were quoted is about $3k in back of invoice, so if they are willing to do that, lease it and trade it in in early. Dealerships want to sell you another car, they don't care if you leased or purchased it.

[MkUrMark]

i would also lean towards leasing, but the interest rate on the loan you were offered seems a bit high (maybe 1% too high), so you could bring down your payment somewhat materially if you negotiate harder on the rate or shop around for a better one. then you would "own" the car for a lower monthly payment, not be concerned about the miles you put on it, and if after the warranty expires you could trade into a new model to avoid your maintenance woes...

out of curiosity, what is a SPB? (sorry if its a dumb question)

Sepang Blue

Keep in mind that the upkeep bills are still the same after the factory warranty expires. I'm not sure if a extended warranty would make sense, but I doubt it.

With the payments being lower and for half the duration (and also a little more than half the down payment), I would lease it.

I think Im willing to get audicare and dice the next 25k miles or trade in a lil early

The issue here is mileage. If you never keep a car more than half of a purchase term, you are essentially leasing it, the bank still owns the car.

You lose money either way, but since you have to add the sales tax in on a purchase, you are paying way more. On a lease, you only pay sales tax for that month. So, if you lease a car and trade it in early, you are better off than if you bought the car and traded it in later with higher miles and more depreciation since sales tax ads to the cost but not the value.

Based on your numbers above, the price you were quoted is about $3k in back of invoice, so if they are willing to do that, lease it and trade it in in early. Dealerships want to sell you another car, they don't care if you leased or purchased it.

The moment of truth will be later today for sure... I feel the lease will serve my purpose a bit better

[RingNut]

Geting AudiCare gives you a point on the residule as well, so well worth the money on a 25k mile lease.

[MkUrMark]

Thank you everyone for the advice

[S3Danny]

If you decide to buy, shop around for a better rate. 3.49 is a little high, even on a 6 year note.

[MkUrMark]

So I ended up being a happy man and leased it... Part of me wants to keep it but Im sure when the third year comes Im gonna be happy it will be out of my hands because off all the maintenance. First time ever leasing a car, hopefully I won't regret it.

[RingNut]

Nice, congrats. That's the best part of a lease, not being committed to a 6-7 year loan. You're only paying for the half you use, if you do decide to keep it, then you pay for the rest of it!

And, Like I said, no dealer wants to miss a car deal so trading it in early is no different than a purchase.

[MkUrMark]

Well said and thank you