i've noticed that more and more people lease their vehicles. i'm a leasing newbie...so trying to figure out if it makes sense for me.

as some of you've read in my other post about deciding between the mdx and rx300...it's been a difficult decision on my end. i'm now leaning towards the rx300 with navigation. which comes out to around $38600 in my area.

that's some hefty payments. so i'm thinking maybe leasing might be an option.

my main reason for considering leasing:
if i regret choosing either the mdx or the rx300...i'll be able to move on after 36 months. by then...hopefully i would have determined what's the suv i like best. maybe i could then trade up for rx330 or a gx470.

so what's the deal with leasing? please help! i did some browsing on edmunds.com comparing financing and leasing...but it didn't help me much. still confused!

 

Actually, amongst ClubLexus RX 300 poll participants, most
people do not lease.

https://www.clublexus.com/forums/sho...threadid=59751

 

I'm definately going to lease my new car for two reasons:

1. I own a small business, and the self emplyment taxes are huge. With a lease you can write off the whole payment, since you're only paying for depreciation. With a lease payment of $500, that comes out to be $6,000 a year I'll save against my taxable income. With a buy like my current vehicle, you have to depreciate its value over the year and then write THAT off, which comes out to less savings.

2. I've had this car for 5 years, and I don't want to do that again. I want a new car every 2-3 years.

Check out www.leasecompare.com there you can plug in your figures (Don't forget to add tax!) your credit score, legnth of lease and miles and it comes out in payment form. I know for me, from a $0 down standpoint lease vs buy, Leasing was a WHOLE lot cheaper.

Also check out www.theleaseoutlet.com, if I get the ES this will probably be the place I'll use. They're the home of the 100% assumable lease which means anytime after 6 months if you want out of your car, they'll take it back and roll the lease over to somebody else, then they'll lease you a new car and give you a $1700 credit as a new customer, good stuff. They could find the car for you a lot cheaper too.

Only things to remember, your credit is much more important in a lease than in a buy because the interest rate (you'll get a "money factor" like .00234, just multiply whatever number you get by 2400 and you'll see in normal percentage points the APR you're at) has a greater bearing on the final payment. If you have credit over 700, leasing can save you a LOTTA money.

The three things you're shopping for in a lease are the capitalized cost (the price you're paying, in this case $38600 less any downpayment) the money factor, and the residual value. You want the lease with the best combination of low money factor, low cap cost and high residual.

Another great thing about leasing is depending on where you live you san save a lot in sales tax. In MD you can't do this, but most states you can. You pay sales tax on each payment instead of the whole sum, meaning you only pay tax for the portion of the vehicle's value you use.

 

before i was torn with what vehicle to get. now i have to decide whether to go with the original plan of financing or try the leasing strategy.

i always like to try new things. more and more...the rx330 looks really nice. and then the gx470. all nice vehicles coming up from lexus. if i do a 24 or 36 month lease...i have option to finish up lease and go with another vehicle...which would definitely be a purchase. rx300 would be an interim solution. but that might not work...because from reading on this forum...rx300 is awesome! so i might decide to keep it.

back to the drawing board...i hope to get this done on wednesday before thanksgiving.

 

If you decide to keep it, you can always buy it after the lease!

 

My personal opinion on the topic? I don't see any point in buying an expensive car when you can lease it. Leasing works really well on all Lexus models because they don't command sticker like BMWs or Mercedes, and their resale is pretty much just as high as those models. I can lease a $40,000 ES300 for $485 a month with NOTHING down. If I were to finance, the payment would be closer to 7 or 800. When the term is up (or before, leases arent as hard to get out of as most people think) you just walk right into your new car.

My father has always leased his cars, until his company bought him his ls off lease, and I've been around when the prior cars are turned in. Excess wear and tear really isn't an issue, they dont care about door dings, or anything smaller than a credit card. Most companies also waive excess mileage charges if you're going to lease the next car from them. Its so simple, they look it over, you sign a form, and its done. No worrying about resale, no bargaining for the trade value. No strings attatched.

For me, the only way I wouldn't lease my Lexus is if I were going to mod it.

 

thanks. that's great advice. it's similar to what some of my friends are saying. i always doubted why my friends would lease...now i have an idea why it might make sense for some people.

and with the high value of lexus vehicles...you don't lose much in residual value. it's starting to make sense in my case.

 

Howdy,
This might be a lousy way to see the glass, but here goes.

If you buy an 2003 RX300 for $39K, at the end of 3 years, the value of the car will probably (assuming normal wear and tear/milage) be worth around $25K. That means you have lost $14K over the past three years.

Now, if you decide to lease the vehicle, for lets say $500/mo for three years, you will have LOST $18K.

I think the choice is foggy. If you can predict that you will not exceed the milage of a lease, and don't want the hassle of trading-in your car in three years, AND.... don't mind throwing away $4K at the end of your three year term, LEASE.

If you are more concerned about long-term resale and treat the car as an investment, you will come out ahead.

Anyone agree with me here?

 

Unless you can write off the lease, have to add in the tax savings.

Plus you forget the cost of interest, and I think the RX will be worth closer to $20k after 3 years with the new model coming out.