Anyone see any problem with this math?

2001 GT $28,000 inclusive. Leased 36 months at 9.9%. Lease rate: $469.60 month. Buy Back $12,480.00.

Total cost at lease end: $29,385.60

2004 Mach-1 $32,000 inclusive. Leased 48 months at 12.75%. Lease rate: $720.80 month. Buy Back $12,926.48.

Total cost at least end: $47,524.88

Am I missing some key issue or is the overall cost for the Mach-1 staggeringly higher at the end of the least than the GT, as compared to initial vehicle purchase cost? I wouldn't have though the difference in the terms and lease rates could account for such a difference?

-Rich

Reply to
Richard
Loading thread data ...

Leasing a car is a sucker bet unless yer doin it for the tax writeoff.....

Gumby619

"Drive it like ya stole it!"

Reply to
Gumby619

Length of loan and interest rate determine total cost. As has been said, a lease is for suckers. Anything the dealer pushes that hard can't be good for me.

So here's the math if you purchase:

GT $28,000 9.9% x 36m $902 payment, $32,500 payback 9.9% x 60m 594 payment, 35,600 payback

Can you really lease a 2001 car? Somethings wrong with your figures for the GT. Essentially you're getting the GT for about 3% interest. Great deal, but I would question those numbers carefully before signing anything.

M-1 $32,000 12.75% x 48m $855 payment, $41,000 payback 12.75% x 60m 724 payment, 43,500 payback

As for the M-1, 12.75% is a pretty high interest rate for a new car. You may be able to find better, depending on your situation. My car loan is at 5%.

Reply to
.boB

Here's a better idea (in my opinion):

First, go here and check on interest rates when buying used from a dealer.

formatting link
Next, take a look at some of these examples:

formatting link
formatting link
formatting link
formatting link
formatting link
Then drive cheerfully into the sunset.

YMMV of course. {;-)

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Tom

1998 GT Coupe 5-spd. Bright Atlantic Blue K&N FIPK, Tri-Ax, 3.73's, FRPP Coated Shorties, SpeedCal, P&P 2K Heads, 2K Intake, Bassani X-Pipe and Cat-Back, Subframe Connectors, JMS Chip, Eagle Alloy Wheels
formatting link
Reply to
bluestang98

Remove NO-SPAM from email address when replying

Reply to
Rein

First of all....28K for a '01 GT??!! WTF?! You can find an 03 Cobra for that with a little leg work.

Mike

1995 Eagle Talon TSi
Reply to
Mike
** Leased

BZZZZZZZZZZTTTTT!!! Unless you can write the payments off your taxes, this is a deal suited for SUCKERS.

If you can't afford to buy the damn thing, start looking for something 2-3 years older.

Regards,

-JD

--------------------------------- JD's Locally-Famous Mustang Page: http:/207.13.104.8/users/jdadams---------------------------------

Reply to
JD Adams

Bingo.

-Rich

Reply to
Richard

Or......you're the kind of person that has resigned themselves to having a car payment forever (typically at a lower price than purchasing) in exchange for having a new car (ie new car reliability, comfort and technology) every few years. Some people are willing to sacrifice having a car payment to not lose their asses trading in a paid off car every few years (or they just like the idea of not driving a shitbox). My wife's father considers practically anything more than 4 years old a shitbox.

Reply to
Jimz466

Sounds like somebody who never learned how to take care of car.

Reply to
Brent P

Where are you getting these prices?????

Reply to
Mustang_66

The situation is that the GT lease was at the amount shown, so yes I guess it was either a mistake or a very good deal back in late 2000. My leased car costs are partially written off, but here's the weird part; Normally, lease rates are lower than purchase rates, but in this case, I was quoted a purchase price of $608 over 5 years on the Mach-1!! The interest rate of the purchase option was lower, 7.4%, but even comparing it to the 12.75% of the lease rate doesn't explain the huge difference. In this case, it seems they are essentially trying to dissuade lessees from going after the Mach-1 and want to confine it to buyers only. I have to check to see how the tax thing stacks up before making a decision.

-Rich

Reply to
Richard

-----------------------

This is a good argument for leasing a car. If you do indeed like the idea of getting another brand new car every few years, then leasing may not be that much more expensive than buying a new car outright and then taking the heavy depreciation loss when you go to trade it in three years later. As far as taking care of the car... leasing is indeed a better idea perhaps for those who do not know how to or just don't want to take care of their cars. Me personally... I always take care of all my cars to an insane level... (I have never leased a car.) But... especially depending on where you live and your situation, it may be difficult or nearly impossible to really take care of a car. For instance, let's say you live in Queens, NY and you are forced to keep you car on the street, and you need to drive it into Manhattan or Brooklyn every day for work, over some of the worst roads in the world, monster potholes everywhere, serious heavy traffic conditions, etc. In this type of situation, there is basically no way that you can possibly "take care" of the car... the car is going to get "wrecked" no matter what. In a situation like this, it may indeed be better to lease a car... this way you have more peace of mind... you can beat the hell out of the car and not feel so bad, because it is not really "yours". It's like you are "renting" it. Then as long as you keep the fenders on it and it still runs ok at the end of your lease term, you hand it back in, and get a nice brand new one. You dump it before things start breaking and wearing out thus avoiding headaches. Of course then some other poor sucker will buy that car used from the dealer and get a can of worms... a car like that will have perhaps twice as much actual wear and tear on it than what the odometer would seem to indicate... but that's the joy of buying things used. Anyway, buying a car new outright puts you in a spot where you kinda really *need* to take good care of the car... it's your personal possession, just puts more stress on overall. I have been burdened with this all my life, worrying about taking care of my cars. There is something to be said for getting your hands on a nice car and being able to just drive the hell out of it and not worry about anything. Like when you go on vacation and rent a car... it's really fun to rent a car because you get to beat the daylights out of it and enjoy yourself without worrying.

Reply to
GT-Vert-03

The breakpoint for lease vs buy is typically around 3.5 years depending on lease rates and load rates.

If you don't plan on keeping the car for more than 3 years, a lease could offer lower total out of pocket costs. There are plenty of calculators available on-line to verify this.

Reply to
SteveL1994
** The situation is that the GT lease was at the amount shown, so yes I guess it ** was either a mistake or a very good deal back in late 2000. My leased car ** costs are partially written off, but here's the weird part; Normally, ** lease rates are lower than purchase rates, but in this case, I was quoted a ** purchase price of $608 over 5 years on the Mach-1!! The interest rate of ** the purchase option was lower, 7.4%, but even comparing it to the 12.75% ** of the lease rate doesn't explain the huge difference. In this case, it ** seems they are essentially trying to dissuade lessees from going after the ** Mach-1 and want to confine it to buyers only. I have to check to see how ** the tax thing stacks up before making a decision.

When you lease, you're basically just renting the damn thing. IMO, unless you're going to drive it 10+ years, buying new is not financially smart anyway. Leasing is just a way to lure in a mark (aka: BoBo) who could otherwise never afford the thing to begin with.

If you can't afford it, look to something 2-3 years older. Americans lately have an anal obsession with driving something they can't afford, to impress others who could really not care less.

Regards,

-JD

--------------------------------- JD's Locally-Famous Mustang Page: http:/207.13.104.8/users/jdadams---------------------------------

Reply to
JD Adams

(You still have to throw those sweeping statements in...) Hey, I own two

11-year-old Mustangs. I'm thrilled with 'em. But for my wife, I want new.

We leased two Mercury Mystiques in succession, and the buyout price on the

2nd one was so low that we bought it. That car is now my daughter's car. Jean now drives a new Escape, also leased.

It's important to me that she be in a new vehicle, one not likely to break down (a la an 11-year-old Mustang), and one with newer safety features. I have no problem swapping the Escape in on something else in three years, and continuing to make payments on "rented" new vehicles for her.

No problem at all.

Some folks find that they need to buy a home and settle down. Others don't mind paying rent for a nice new apartment. Personal choice.

dwight

Reply to
dwight

Buying a well cared for 2 or 3 year old car coming off a lease (with 24,000 or 36,000 miles) is a LOT cheaper and she is no more likely to be stranded than in a new car. ALL cars are a LOT more relaible these days and most will go well over 100,000 miles with only routine maintenance.

LJH

95GT

Reply to
Larry Hepinstall

I got a kick outta that line :-} So true.

Paid cash for my 2004 Mach 1 as I'm one of those whom doesn't like the idea of financing plus higher insurance. I buy cars, trucks and motorcycles for me. I don't give a damn what anyone else thinks.

Davïd Greenville, NC

Reply to
Ðavïd
** Buying a well cared for 2 or 3 year old car coming off a lease (with 24,000 ** or 36,000 miles) is a LOT cheaper and she is no more likely to be stranded ** than in a new car. ALL cars are a LOT more relaible these days and most ** will go well over 100,000 miles with only routine maintenance. ** ** LJH ** 95GT

I've found this to be true as well. Most of my co-workers buy 2-3 year old off-leases at about half the new price, and they couldn't be happier with them. All of the bugs are worked out, recalls remedied, taxes/delivery/depreciation is already paid by the first owner, and they look/run great. Apply a decent amount of maintenance and they will serve one well for a very long time.

Regards,

-JD

--------------------------------- JD's Locally-Famous Mustang Page: http:/207.13.104.8/users/jdadams---------------------------------

Reply to
JD Adams

Well, the key ingredient that your not understanding is that the dealer or bank has determined that there is no real residual value left in the car once your lease is up. So you have to absorb that depreciation in the lease payments.

Reply to
23 skidoo

MotorsForum website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.