questionsshould i buy or lease a car?


Leasing is akin to renting, and much like renting, you are expected to return the car in like-new condition. "Minor" stuff like a carpet stain or door dings will be charged. The upside is that you're paying less a month, but after the lease period, you're left with nothing too.

If you're a business, which can write off leases easier than purchases, then it makes more sense. If you desire a new car every 2-3 years, then leasing can make more sense. If you keep your cars longer and/or have been involved in less than ideal conditions from time to time, then leasing doesn't make sense.


Give a lot of consideration to the mileage you are allowed before incurring terrible fees. This is an issue for everyone I know that leases.


99% of real people should be buying, not leasing. Leasing is for companies, and for people who think they need a better car than they can really afford.


Buy a car that you can afford in straight-up cash. Set aside monthly savings for a new one. Upgrade when the old one is ready to kick the bucket, or you incur a repair worth more than the value of the car.


I agree its better to pay straight up cash, but its just not realistic for a lot of people. I've never leased, but I watched my parents do it...I'd say just buy a car. Get at least enough for a good down payment so you can have an affordable payment without doing a 6 year loan.

Basically, my parents leased a car. They had a small cosmetic fender bender. Insurance deductible wasn't worth it to get it fixed, but it also would cost $1000s on returning the car to the dealership. So they ended up signing on to just buy the car when the lease was up. Now they'll end up paying $20k for an $11k car because of the added on value + interest when you decide to buy a lease.

My parents weren't exactly smart shoppers, but I still say even a savvy car shopper and responsible driver should just buy. Take car of your car, and it will take you a long ways.


Have to agree with everyone else. Based on what friends who did lease have told me, I would never lease a car for my personal use.
Buy a 2 year old used car. It's a better deal.


As noted by tfisch, SlappyWhite and others, BUYING is the clear choice for almost everyone. Leasing makes sense when you are:
1. writing off the cost as a business expense,
2. really have limited need of vehicle, such as a fixed commute,
3. require a replacement vehicle at fixed intervals regardless of cost.

However, buying a car at current prices can also saddle you with more debt than wanted. As noted by others, you should set aside a down payment and manage your current vehicle use like an investment in your next buy.

Even better, as FlyingGirl notes, looked for used cars. Three of my last four cars have been bought from fleet sales. I get a 2-3 year old vehicle that had regular maintenance and pay 50% or less of the original MSRP. I also plan on keeping a car for a number of years. It is worth shopping carefully for something you'll live in for a while.


@tpscan pretty much summarizes it well, though I'll point out that an accident can wreck a lease even if you are completely not at fault.

My neighbor's Mercedes SUV was legally parked outside when the left rear quarter panel was crushed slowing down an Acura on its way to totaling itself and a Jeep across the street. Insurance covered the SUV repair which was done by Mercedes to their spec. Unfortuanately, it also dinged the car's resale value by $9k (apparently this isn't covered by insurance) so my neighbor can either buy the car at the end of the lease (and get a $9k discount on a car he already doesn't want any more) or else make up the $9k when the lease ends.


I leased since I tend to like a new car every few years. I don't drive enough to go over milage limits, and had good luck with not being charged for anything. I was able to get more car for less of a monthly payment, I was always covered under the factory warranty, and got a new ride every few years.

Now, I own a car (well, I have a monthly payment) because I wanted to try keeping a car for 6 years. I'd like to, for once, have no car payment for a year. But, that's really the only reason I bought a car. And, I bought a car that was a lease :-)

So, I think it depends on what you like. Want a new car every few years? Maybe try a lease. If you are in for the long-haul and don't want to worry about being charged for stuff, maybe you should buy. Keep in mind, when you go to do a lease, you can still negotiate the price of the car! Many people don't do this. At the end of the lease you can have an option to buy it, so that could matter! Also, it can effect the lease price. Negotiate!


NO... got burned by a lease deal several years ago and learned my lesson. Even after having the car detailed there were some hidden fees (mileage and cosmetics) that cost me at the end of my lease. Wont do it again and I recommend to anyone asking that they not do it. Bad deal in the end as you have no equity in the car either.


@jrsulli369: Fees generally aren't "hidden", unless you hid your paperwork. It's all there. I've never had an issue, and I leased high-end cars. As well, you can (and should) fight charges if you take photos beforehand. Similar to if you are leaving a rented apartment.

I'm not sure what equity has to do with a car. Many people don't get have much, if any, equity in their car, as they depreciate in value. Usually, if you have equity, then you put a lot of money down, or have it paid off. Usually, you're lucky to get a trade-in near to your pay-off if you were to trade it in at the 2 or 3 year mark, which is usually the term of a lease.


My wife was leasing a car before we met, and it was a big mistake. As noted by others you get essentially nothing back for your car at the end but you still have all the liabilities and you generally are required to have full comprehensive insurance on it.

Tragically, when the lease ended we decided to buy the car because we liked it and inherently knew its history. That was an even bigger mistake as we soon found we were underwater on the financed purchase price of the car; over 1.5 years later we owed 1.5x as much on the car as it was worth on the open market.

In other words, if you lease, you will end up taking a bath on the matter. If you really screw up like we did and lease, then buy your own leased vehicle, you take a second bath.


@lparsons42: So, leasing screwed you because you made the choice to purchase it after the end of the lease?

I'm not sure why people mention equity. Who gets equity back from something they don't own?


@lparsons42: You were underwater because of the way loans work, not because you were screwed. If you look at an amortization table, you will find that in the early period of the loan, the majority of your payment is interest.


@kmeltzer: WOW a down vote for giving an answer to his question, my opinion! I am a buy it out right buyer now, I trade up every two years and pay for my vehicle on the spot, that's what I meant by equity in a vehicle.

No I am not some millionaire playboy (but I do dream) that can go out and pay cash for any vehicle I want but I do put five hundred a month away (average car note) and after 2 years I trade in my car for the newer model and I own it outright, it works for me.

As for the bad lease deal they stuck me for undercarriage issues I never thought about, and it cost me to get out of the lease then they wanted me to lease another BMW from them, no way in hell.

Once again my opinion, and the way I do business.