Does leasing a car make sense in this scenario?
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Anonymous
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Not a luxury car, but a Hyundai Sonata. They want to push out the 2015 stock.
- $235/month for 18,000 miles/year, additional $500 down so for three years really $249/month including tax. - Can buy at 1.79% for five years but to get to $249/month have to put down $7K. Situation is that I am on a consulting assignment that is 105 miles/day round trip so that pushes it to 26,000 miles/year without breathing hard. So OK, leasing doesn't make sense. Next assignment could be 15 miles away but I also go to school part time and even if the closer commute happens, still around 18,000 miles/year. Did a nine year projection lease vs. buy. If I buy another car in year 8.5 - 9, leasing winds up costing me $940 or $105/year more ASSUMING my commute gets shorter. If I wind up driving all over the place, I will get beat up with the mileage charge. What would you do with all these unknowns? $7K is not small change for me right now because of school tuition (trying to keep student loans to a minimum). |
Anonymous
| I would not lease a car with those many miles to drive. What are you planning to do about the overage? |
Anonymous
| Buy a used car instead? |
Anonymous
| I'm not clear on whether the OP already has a car. Whatever the case, I would not lease that car. |
Anonymous
| OP again. I am finishing up a lease with another vehicle and taking a big hit on over miles. When I got this car, was commuting 22 miles round trip. Then I took this consulting assignment and never expected it to last longer than one year. Was looking at used cars but anything decent, say 2011 Ford Escape with 65,000 miles is fetching about 13-14K. And with all this mileage, how long is it going to last before big repairs come so do no think I am gaining with a used vehicle. Plus I worry that older vehicles do not have as many safety features. |
Anonymous
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You are in school AND have a consulting job where you drive over 100 miles per day? Buy a car that you can afford. Don't lease. |
Anonymous
| I drove a 2003 Ford Escape to 180k miles and it was still in okay shape when I got rid of it. Buy the used Escape. |
Anonymous
OP again. how much can you bargain for if you buy the Escape at a Ford dealer. Say, shows $14k, what is a good rule of thumb? Also, a three year loan for one? Thank you. |
Anonymous
| Since you will be consulting, buy it new or something used, and take the depreciation and expense the mileage. Otherwise, you could write off the lease as a business expense. |
Anonymous
| So if you can write your mileage off, get the most efficient car you can. |
Anonymous
| Do not lease when you drive that much. |
Anonymous
OP, not an independent consultant so cannot deduct mileage? I work for a company that sends me to different projects on a W2 basis. Escape gets 21/28 in mileage so not great. Also looking at 2012 Altima, which is near same price with better gas 24/30 ish. |
Anonymous
I have no idea because my parents bought it new in 2002. But I just got rid of it this past June so... |
Anonymous
| Buy a Prius with the 7k |
Anonymous
OMG, I bought a 2004 with 70,000 miles 5 years ago and it is still going super strong. You're barely breaking in any "good" models at that point. I don't know how Ford Escapes are rated on reliability, but do your research. You may end up wanting to go Japanese, but I do know American cars have come a long way too. Do not lease. Buy a used car. |