Lease or Finance??

[phantom]

as topic...

which is a better deal??

If I am going to lease the car, is that mean I can't even mod. it?? (engine or other stuff?)

I have been financing my P5 right now... but thought I might go for leasing the MSP so I will have more $$ to spend on the car each month.

I may change my car in couple of years... but what will happen if I don't want to stick with mazda or this dealer by that time??

 

[digi168]

You can usually get out of any lease after 2 years, with no penalty. Just remember with a lease that anything you do to your car has to be either reversable back to stock, or it has to add value to the vehicle. Plus with a lease I can write it off 100% as it is the car for my business

 

[krillin]

leasing is normally for someone who already knows he is going to change his/her car in 2-3 yrs and doesn't mind "renting". see, i live in California and leasing cars seems to be a trend here. people always want to change their cars. the only thing is that you keep dishing out lots of money and have nothing to show for it at the end.

the thing about leasing is that you normally don't have to put a down payment and the monthly payments are lower. if you do want to buy the car at the end of the lease then you normally lose out cuz the residual is sometimes high, but at least you have something to show for the money you invested. leasing also gives you a limit on miles a year. if you think you'll be driving a lot then don't lease. you also want to mod the car but don't forget, you don't own the car. if you do mod it then you gotta take everything off when you give the car back, then you're stuck with all those parts.

i'd say buy the car. try to put down at least 25% of the car. the more you put down the lower your monthly will be. get the person with the best credit in your family buy the car for you so that you get a low rate. you will still be able to mod the car to your liking. i think the resale value will be higher than most cars since it's a limited edition vehicle. at least if you do it this way then you get back at least some of your money. if you're rich and don't care about the money, then lease.

 

[JPBlackMP5]

What he said.

Purchase.

 

[digi168]

Only purchase if you have enough of down payment and can cover the taxes otherwise you are paying interest on tax which really sucks.

 

[Newf]

I don't keep my cars beyond 2 years. So, lease is great for me. Besides, if I purchased, I'd have higher monthly payments, and I'd have to keep it for 4-5 yrs before I owned it.....and then what...trade it in and start over. So, your stuck with a monthly payment anyway for the rest of your life. Why not take the lower monthly payment. Purchasing is the only way to go if you really want to mod a lot. Otherwise, your really just throwing away money. But, the only time I'd ever purchase, is if I knew I was going to keep the car for at least 6-7 years, or mod heavily.

When you lease, there is a sweet spot to trade in the car. I basically right now owe less on the car then what it's worth. So, I'll sell the MP3, and pay off Mazda. Take the money left over, and put it down on another lease to make the payments lower again. 2 yrs from now, I'll trade again....and do the same thing. And repeat. I get a new car every 2 years. I never have to deal with something breaking down. Heck, I rarely have to worry about replacing tires, or wiper blades. I may never really own the car....but it is in my driveway every day/night isn't it.

later





just me 2 cents.

 

[dimic]

When you lease, there is a sweet spot to trade in the car. I basically right now owe less on the car then what it's worth. So, I'll sell the MP3, and pay off Mazda.

just me 2 cents.

I agree with most of original post. It makes sense to lease, if you know you are not going to keep car for more than 5 years. Especially for Canadians, since you don't pay ~15% tax on part of residual value. However, you usually shell out more in interest, so it evens out.

However, newf, if you think you're in the sweet spot with MP3 now, I believe you're lying to yourself. Offer that you have in For Sale forum - you'd have to find someone stupid or in the heat... I may be wrong, but it look to me definitely overpriced. Anyway, good luck, exclusivity of MP3 could be worth that much if you find that 'special' customer.

Oh, yes, back to original subject, MSP is not particulary good car to lease - residual is slightly lower than brethrens (48% after 4 years) and interest rate is not too sweet 7.9% in Canada, but that is not too bad either. Be aware that at the end of the lease you may be responsible for brake job, tires, and every nick and scratch. Also, if you want to exercise purchase option, you get ding with dealer's transfer fee - was 350$+tax, certification and emission, and ~15% tax of course... You are basically changing ownership of vehicle, although you keep it... Go figure

 

[digi168]

Actually the lease rate on my paper work is 6.9% at the top and 6.4% at the bottom, apparantly Mazda offers a Half point off to repeat customers and the residual is 51% maybe differnt in toronto, but that is what it is out west.

 

[oliver2000]

here is a novel thought...

Pay cash.... or use a secured line of credit....at 1/2 point above prime with no min or max payments.

Does anyone know if the Mazda financing is open meanin I can payout the car anytime ?

They have 60 days no interest on as a promo ( yes on the MSP as well )...figure I might take the 60 free days of course only if you are not locked in

 

[Newf]

I my defence, my best time to sell the car would be like end of next year really. But.....can I wait...hell no. MSP is out now

And, my price for my car includes new Winter studs, rims and hubs. AND, I've seen people sell MP3's in Canada for more with 30-40,000 kms on them. Mine as 19,000. And my Dunlops are near PERFECT. rotated every 4500 kms.

So, it's NOT that bad as you make it sound.

And I've seen TWO civic SI's get sold here within the last month. One 2002 with 40,000kms, the other 2002 with 36,000 kms, and they got 20,000, and 20,500. So, 22 with winter rims/tires/hubs, 1/2 the kms on a limited edition car with a s*** load more options stereo aftermarket parts etc......I've got to be able to get a least 21-21.5 for it.

Oh, I was also told 7.9 for the rate....bad. I'm going to see if I can get something a little better somehow.

 

[1sty]

For a protege since the resale sucks I would buy.
A fun Fact. I can Lease an new Infinity G35 for $50 more a month then I am paying for my MP3.

 

[phantom]

thanks for the advice guys!!! still struggling which way to go with... seems like financing it have less things to bother about. well, of course you pay more each month.

so, what will happen if I don't want to stick if mazda or the same dealer after 2 years of lease??

 

[86_911_4sale]

I need to look into the Leasing option to see how the details of the plan work. I would want to put down $2-3K and have a monthly pymt. of only ~$200. This should help out my debt/equity ratio when I buy a house. My daily commute is <2 miles to work and I have another vehicle if the mileage starts to get too high so the lease option may work out well for me.

Other than not building up some equity (not much I know) in the car by purchasing it, are there any other significant benefits to purchasing a car over leasing one?

As for the pros of leasing what are they?
I know the monthly payments are lower and you get to change cars after 2-3 years if you don't want to buy out the car, but what are the other pros?

-T

 

[phantom]

86_911_4sale, looks like you'd help me to ask the questions i'm in doubt with... hard to figure out which way to go...

 

[Newf]

if you drive a lot.....don't get a lease. 20,000kms per year is what my lease averages out to. 80,000kms max in 4 yrs. Now, my car is 15-16 months old, I have 19000kms on it. So, mileage not a problem for me. A buddy of mine had a Cavy in Toronto, he racked up 6000.00 worth of mileage after the lease was up. He was forced to get a loan, buy the car, which was falling apart ( it is a Chevy afterall). Years later, he still owns it...still paying for the same car after almost 5 years.

This is only the 2nd car I have leased. I was going to buy it. But, I knew I was going to be buying a home this year. interesting thing with a lease, is that when you go to get the mortage, it doesn't show up at all. Whereas, a car loan, your in dept what you owe on the loan. A lease is for all purposes, a rental. So, if something happens to your job, you just give the car back( you don't WANT to do this, as it'll probably screw your credit, but that's the worse case). Whereas a loan, if you can't pay it....you still have to pay it somehow so your f'd.

When I got my mortage, once I said I had a lease.....it wasn't even a concern.

My first lease....I hated it. Could stand "renting" a car. Felt like I was throwing away money. But, after seeing how easy it was to switch to a new car when I moved into the MP3.....s***, this is too easy. New car every year please

 

[dimic]

As for the pros of leasing what are they?
I know the monthly payments are lower and you get to change cars after 2-3 years if you don't want to buy out the car, but what are the other pros?

-T

There is only one other positive thing I can think off. If you're not the guy that does like selling your own car, you usually get screwed really bad when trading in car in the dealership, right? With lease, you know that you can return car at the end of the lease at set value. This value, in my experience is HIGHER, than what you would get if you were to trade in your car (not counting tricks where they get you good trade in, but no discount). In effect, if you're OK with lease term, and you would anyway change car around that time, you can consider as if you got quite good trade in. Also, realated to this one, everyone is saying that Honda/Acura has higher resale than Mazda. Well, guess what, residual after 4 years is around 50% for any of these cars. Which basically mean that with lease you're protected from perceived/real low resale value of Mazda (in comp. with Honda). Or maybe oposite, it does not pay to lease Honda, better buy it .

Problem with lease is that timing of return may be tricky for you, to schedule another car that you like.

Also, depending on the dealer, you may have problem returning the car before end of the lease. 5 months before end of the lease, I wanted to return my Camry V6 (I know, I know...), and dealer/Toyota Finance required me to pay all rates that I did not pay off yet. They would not budge for a cent. I was trying to return that car actually in last 2 years of the lease, and it was always prohibitively expensive. Not penalty, there is no penalty, but recalculated residual (which is not in the contract) was always too low, and set-up by the dealer. So, you have to fill the difference between currently paid off part and low residual with your own bucks. It could have been only my dealer , hee, hee. Now, If you're ready to declare bancruptcy, that is another case, you've got leverage...