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Posted by Marty on Thursday, February 19, 2009 at 01:27:06 :
In Reply to: Re: I've always wondered why people lease posted by Rorry on Wednesday, February 18, 2009 at 21:31:13 :
It just depends on the circumstances.
Almost all leases are through the manufacturer or a lease company...it's nothing at all to do with the dealer.
So lets look at this situation...3 years ago I leased the 2006 Power Wagon. I could have bought it....but let me walk you through this...
So when I leased that truck, the window sticker here in Vancouver was $49,000. Yes I know their cheaper in the US but also smaller payments so it's the same...follow along :)
So when I leased this truck, it was zero % financing for all leases through Chrysler Financial on gas trucks because they couldn't give them away. I put zero down & my payments were just under $500/month.
I tried buying the truck outright & the cheapest I could buy it through the fleet department was $44K.
So in December I decided I wanted out of the truck...it was breaking me in fuel cost. I droped it off at the dealer & told them to just sell it & get me out of it. It took 2 months but they sold it for almost enough money to buy me out of the lease...somewhere around $28K & I had to cough up another $1000.
So lets look at this...I paid out 36 payments of $500...plus the $1000. That totals $19,000 to own the new truck for 36 months.
OK...so lets say I bought it for $44K instead. If I bought it for $44K...just the tax payable on purchase (12% here in BC)....So that's $5160 in tax. So that means we're now into the truck for $49,160 to buy the truck.
So they just sold it for $28K....that means if I bought it & owned it for 3 years & needed, or wanted to sell it...I'd have just lost $21,160.
You follow?
In this case I would have lost $2160 extra if I bought the truck as opposed leasing it because you pay ALL the tax on the full purchase price up front...instead of only paying tax on your payments.
It just depends on the specific deal.
Leases definitely have their place.
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