Username or Email Address
Do you already have an account?
Forgot your password?
  • Log in or Sign up

    VWVortex


    The Car Lounge
    Page 2 of 14 FirstFirst 12345612 ... LastLast
    Results 26 to 50 of 326

    Thread: car lease question. yay or nay? (calling The Financial Lounge!)

    1. Banned SVTDanny's Avatar
      Join Date
      Aug 7th, 2005
      Location
      Winchester, VA
      Posts
      16,875
      10-01-2012 08:54 AM #26
      Quote Originally Posted by dieselraver View Post
      subie was financed and it had negative equity rolled in from the damn GTI. (i've learned NO MORE FINANCING!)
      Financing isn't your problem, being underwater is. Put more money down, take shorter loans, and stop trading cars in a year after you buy them. That's how you lose a lot of money really fast.

      Stop the cycle now.... if you really want the van, don't pay the negative equity of the Outback off through the lease. Just kick in the $2-3k at the time of the van purchase and be done with it.

    2. Member Mike!'s Avatar
      Join Date
      Jun 17th, 2002
      Location
      Ontario & Ohio
      Posts
      14,456
      Vehicles
      2010 Mazda6 GT-I4
      10-01-2012 08:56 AM #27
      You need a bigger vehicle, so it's good that you're getting what you need for your family. That said, you have some rose-colored glasses on about leases and "never financing a vehicle again!" Your negative equity from the GTI and then the Outback has come from not being able to keep a vehicle for four years.

      What are you going to do 2.5 years from now when the Ody no longer suits you? A lease takeover isn't any more fun than selling a car with negative equity.

      You asked for Financial Lounge advice, and the nuts and bolts is they would want you to pay down the Outback more and sell/trade it for a used ~2009 or even older Odyssey of a similar price to the Subaru. The root of your issues with never having equity in your cars is new vs. used, not finance vs. lease.

    3. Geriatric Member ATL_Av8r's Avatar
      Join Date
      Oct 17th, 2002
      Location
      Gapiana
      Posts
      42,700
      10-01-2012 08:57 AM #28
      Quote Originally Posted by dieselraver View Post
      dude is touching your wife's knobs!
      MemeGate 2012 - First Responder, post #2

      Quote Originally Posted by .skully.
      Mike, quote me in your signature

    4. Member Mike!'s Avatar
      Join Date
      Jun 17th, 2002
      Location
      Ontario & Ohio
      Posts
      14,456
      Vehicles
      2010 Mazda6 GT-I4
      10-01-2012 09:01 AM #29
      Quote Originally Posted by dieselraver View Post
      So to my car dealer friends. Can this price be negotiated less?
      Original lease price is $366/month OTD

      Negative equity in the outback is $2600. Which brings the lease price to $461/month. Is that too much? Or about right?

      Can I negotiate it less?
      You said a 3 year lease, right? $95/mo for a 'loan' of $2600 for 3 years is a 18.7% effective interest rate. That seems high. What's the interest work out to on the overall lease?

    5. Member Spax MC's Avatar
      Join Date
      Oct 25th, 2006
      Location
      845 NY
      Posts
      1,999
      Vehicles
      13 CC R-line, 99 M3 Vert
      10-01-2012 09:19 AM #30
      good luck with everything, the odyssey is an amazing car. i just helped my father-in-law buy 2 of them. we just bought a red ex-l in florida for 31k and a smoky topaz touring in nj for 36k if that helps any with your prices

    6. Member barry2952's Avatar
      Join Date
      Jun 13th, 2007
      Location
      Farmington Hills, MI
      Posts
      14,168
      10-01-2012 09:25 AM #31
      Quote Originally Posted by TM87 View Post
      I never understand the point people make about a lease "You are paying for something that isnt yours". Im sorry but if you are financing a car, you are still paying for something that isnt yours.
      Incorrect. You can easily sell a car you're financing and get a new one. It's nearly impossible to break a lease unless you want to line their pockets with your money.

      As far as ownership goes, you still own the car, even if making payments. The bank has a lien on it, but you are free to dispose of it if you want to. You own nothing if you lease.

      Companies lease for profit, at your expense. You are paying for depreciation and mileage up-front. That's what makes no sense.
      Garmin Is My Pilot.

      I am confident you are wrong, but instead of illustrating why, I will just make disparaging remarks about your reading comprehension.
      -Zukjimpiphile

    7. Member
      Join Date
      Sep 6th, 2004
      Location
      Albany NY
      Posts
      2,129
      Vehicles
      02 Jetta GLI VR6
      10-01-2012 09:49 AM #32
      Quote Originally Posted by barry2952 View Post
      Incorrect. You can easily sell a car you're financing and get a new one. It's nearly impossible to break a lease unless you want to line their pockets with your money.

      As far as ownership goes, you still own the car, even if making payments. The bank has a lien on it, but you are free to dispose of it if you want to. You own nothing if you lease.

      Companies lease for profit, at your expense. You are paying for depreciation and mileage up-front. That's what makes no sense.

      Spot on.

    8. 10-01-2012 09:50 AM #33
      I agree with barry2952 about leasing and that Ive never understood why people do it over purchasing. The dealership is making out on the front end and in most cases on the back end when the car is turned in. You could almost say 3 ways becasue they will sell the turned in car. Granted I have really only known two types of people that lease. First type is the person that wants a car they truly cant afford and leasing gives them the flexablity to move into the car at a much lower monthly. The second type I know is the person that literally flips a car every 2 or 3 years and would be upside down in a payment situation and the lease gives them the flexability to get out of the car. Either way, hope everything works out for you and your family.

    9. Member barry2952's Avatar
      Join Date
      Jun 13th, 2007
      Location
      Farmington Hills, MI
      Posts
      14,168
      10-01-2012 10:51 AM #34
      I also don't believe that any mods to the car, reversible or not, are acceptable at turn-in time. I really don't understand mods, either, past wheels and tires, but that another whole discussion. I especially don't understand modifying a car you don't own.

      My wife and I discussed this last night. Her sister is the ideal candidate for leasing. She doesn't have the money for a downstroke and doesn't want to risk out of warranty repair costs. We explained that she'd be better off owning the car, but she can't put 25%, or more, into a down payment.

      I, personally, never finance for more than 6 months. That gives me time to liquidate something to pay off the balance. I could easily tap my home credit line, but that doesn't help my credit history. Lenders want to see activity, in addition to solvency.

      I guess I do understand why some people lease. What I don't understand is; as good as todays cars are, why aren't people keeping them longer. I grew up in the '50s in a house where my father was in the advertising business. He felt it necessary to show his clients that he was successful, but not too successful. He bought a new car every two years. His cars did get cooler and more expensive as time went on. He had a '64 Wildcat convertible followed by a '66 225 ragtop and then a '68 Toronado followed by his black '70 Lincoln Town Car.

      The only car I ever flipped was my 528e. It was so slow that it couldn't get out of its own way. I traded it after 8 months on a 533i, which I put 100,000 miles on, as I have on every subsequent vehicle. My DD '98 ML-320 has 182,000 on it. Yes, I'm paying for ongoing repairs, but nowhere near what it would cost to replace it.

      I guess I did flip cars once before. I'm sure I've told this story. My banker called me in 1980, I think, offering the inventory of a Porsche repair facility that specialized in 356s. They had pulled out 10 cars into the field behind the padlocked store. I bought all 10 cars for $1,000 and flipped them to a foreign car pick and pull the next day for $2,000. There were a couple of Speedsters, mostly Coupes and a few Cabrios.

      I sure thought I was smart, doubling my money in a day. Around 1990 I started kicking myself and bashing my head against the wall, and it hasn't stopped.
      Last edited by barry2952; 10-01-2012 at 10:56 AM.
      Garmin Is My Pilot.

      I am confident you are wrong, but instead of illustrating why, I will just make disparaging remarks about your reading comprehension.
      -Zukjimpiphile

    10. Member dieselraver's Avatar
      Join Date
      Nov 11th, 2007
      Location
      Brooklyn NYC - Current Cars: - '15 VW Touareg TDI Lux '14 VW Autobahn/Nav GLI 6 M/T '01 Accord
      Posts
      12,513
      Vehicles
      Previous Cars: '12 Odyssey EX-L '10 Subaru Outback MT '08 BMW 328XI 6MT '08 GTI 6MT '07 Rabbit 5MT -
      10-01-2012 11:03 AM #35
      Quote Originally Posted by Mike! View Post
      You need a bigger vehicle, so it's good that you're getting what you need for your family. That said, you have some rose-colored glasses on about leases and "never financing a vehicle again!" Your negative equity from the GTI and then the Outback has come from not being able to keep a vehicle for four years.

      What are you going to do 2.5 years from now when the Ody no longer suits you? A lease takeover isn't any more fun than selling a car with negative equity.

      You asked for Financial Lounge advice, and the nuts and bolts is they would want you to pay down the Outback more and sell/trade it for a used ~2009 or even older Odyssey of a similar price to the Subaru. The root of your issues with never having equity in your cars is new vs. used, not finance vs. lease.
      I sincerely appreciate TFL's advice. I think we may pay down the negative equity and retain the $366/month the negative equity is about $2600.00
      Looking for a new or used Volkswagen in NY/NJ/CT? PM me! I offer bottom line pricing! GTI Monster Mats & Gorilla Liner for Sale! http://forums.vwvortex.com/showthrea...la-Trunk-Liner

    11. Senior Member Hostile's Avatar
      Join Date
      May 29th, 2002
      Location
      NoVA
      Posts
      30,674
      Vehicles
      '15 STi & '13 GTI
      10-01-2012 12:19 PM #36
      Quote Originally Posted by dieselraver View Post
      subie was financed and it had negative equity rolled in from the damn GTI. (i've learned NO MORE FINANCING!)
      Or just stop trading in cars you still owe money on...

    12. Member a2a4raddo's Avatar
      Join Date
      Aug 14th, 2001
      Location
      New York
      Posts
      19,818
      Vehicles
      Porsche & Honda
      10-01-2012 12:46 PM #37
      Quote Originally Posted by barry2952 View Post
      Incorrect. You can easily sell a car you're financing and get a new one. It's nearly impossible to break a lease unless you want to line their pockets with your money.

      As far as ownership goes, you still own the car, even if making payments. The bank has a lien on it, but you are free to dispose of it if you want to. You own nothing if you lease.

      Companies lease for profit, at your expense. You are paying for depreciation and mileage up-front. That's what makes no sense.
      You can sell your car if you are leasing as well. There is always a pay off on the vehicle, and every month you are buying down that pay off just like a finance. And just like a finance, the bank owns the car.

      Companies lease and finance for profit. In a lease you are simply paying for the depreciation of the vehicle (the portion you use). You aren't paying up front, you are paying over 3 years. The vehicle is going to depreciate more in the first year then you have paid for it. But it's a curve and your break even point is typically going to occur right around the time your lease matures, at which point you can extend your lease, purchase the car, or give it back.

      You finance a car for 5 years and trade it after 3, you will still have negative equity unless you put. Large sum of money down. With a lease, you don't have that issue. The bank assumes the risk. If its worth more then the residual, great for them. If it is worth less then the residual...that's a risk they took and they were on the losing end. Most people trade every few years, leasing costs less then buying and trading. You also always have the latest in technology, safety, and a reliable car that won't break down, as well as one that will require minimal maintenance as you are always driving a late model car.

      Leasing may not be for you, but it works for many people. I have purchased cars outright, financed cars as well as leased cars. And you can most def" get out of a lease early. There are a few ways to do it. Trade, sell, or have someone else assume your lease......which my friend just did with his BMW.
      Last edited by a2a4raddo; 10-01-2012 at 12:53 PM.

    13. Member a2a4raddo's Avatar
      Join Date
      Aug 14th, 2001
      Location
      New York
      Posts
      19,818
      Vehicles
      Porsche & Honda
      10-01-2012 12:50 PM #38
      Quote Originally Posted by dieselraver View Post

      is lojack for $9.00 a month extra worth it?
      No, not at all. The vehicle is leased. It belongs to Honda. As bad as this sounds, it would actually work in your favor if the car is not recovered. Insurance will pay it off, most leases include gap insurance as well. I know Honda leases do. So you are off the hook. Now you can lease a new oddy and your payment will be much lower as you no longer have negative equity being rolled in.

    14. Forum Sponsor Brendan@bwalkauto's Avatar
      Join Date
      Nov 28th, 2009
      Location
      Redwood City, CA
      Posts
      9,325
      Vehicles
      MkVII GTI, E9
      10-01-2012 01:35 PM #39
      Quote Originally Posted by barry2952 View Post
      I guess I do understand why some people lease.
      For some it is to drive a car they can't really afford. For some, it's a way to have an exit strategy because they flip through cars every few years (need to appear successful, etc). For some, they get bored easily, and want to drive different things.

      Or, in my case, I leased my LEAF because the lease payment is less than the money I spend on gas commuting in my 540i, and I charge for free. Kinda hard to pass on a free car.
      Brendan Dolan
      Boardwalk Auto Mall
      Volkswagen l Nissan l Chevrolet l Lotus
      My 2800CS #FREEPATRIKMAN
      Quote Originally Posted by SivNiz View Post
      Have you ever been to the Terror Grill? Would you like to go?

    15. Member Mike!'s Avatar
      Join Date
      Jun 17th, 2002
      Location
      Ontario & Ohio
      Posts
      14,456
      Vehicles
      2010 Mazda6 GT-I4
      10-01-2012 01:43 PM #40
      Quote Originally Posted by a2a4raddo View Post
      You can sell your car if you are leasing as well. There is always a pay off on the vehicle, and every month you are buying down that pay off just like a finance. And just like a finance, the bank owns the car.
      A lien is not ownership. You own a financed car, but the bank has a legal claim against the property.

    16. Member dieselraver's Avatar
      Join Date
      Nov 11th, 2007
      Location
      Brooklyn NYC - Current Cars: - '15 VW Touareg TDI Lux '14 VW Autobahn/Nav GLI 6 M/T '01 Accord
      Posts
      12,513
      Vehicles
      Previous Cars: '12 Odyssey EX-L '10 Subaru Outback MT '08 BMW 328XI 6MT '08 GTI 6MT '07 Rabbit 5MT -
      10-01-2012 04:09 PM #41
      Quote Originally Posted by a2a4raddo View Post
      No, not at all. The vehicle is leased. It belongs to Honda. As bad as this sounds, it would actually work in your favor if the car is not recovered. Insurance will pay it off, most leases include gap insurance as well. I know Honda leases do. So you are off the hook. Now you can lease a new oddy and your payment will be much lower as you no longer have negative equity being rolled in.
      Exactly! Thank you guys. It's been a process. In order to buy a car from Massachusetts and bring it to New York is a nightmare but in the end it's financially worth it.
      Looking for a new or used Volkswagen in NY/NJ/CT? PM me! I offer bottom line pricing! GTI Monster Mats & Gorilla Liner for Sale! http://forums.vwvortex.com/showthrea...la-Trunk-Liner

    17. Member a2a4raddo's Avatar
      Join Date
      Aug 14th, 2001
      Location
      New York
      Posts
      19,818
      Vehicles
      Porsche & Honda
      10-01-2012 04:33 PM #42
      Quote Originally Posted by Mike! View Post
      A lien is not ownership. You own a financed car, but the bank has a legal claim against the property.
      Yes. However......untill you make that last payment...the car isn't really yours as the bank has legal claim against it. So you can't do anything you please with it....such as export it to a foreign country permanently or temporarily for that matter.

    18. Member dieselraver's Avatar
      Join Date
      Nov 11th, 2007
      Location
      Brooklyn NYC - Current Cars: - '15 VW Touareg TDI Lux '14 VW Autobahn/Nav GLI 6 M/T '01 Accord
      Posts
      12,513
      Vehicles
      Previous Cars: '12 Odyssey EX-L '10 Subaru Outback MT '08 BMW 328XI 6MT '08 GTI 6MT '07 Rabbit 5MT -
      10-02-2012 03:14 PM #43
      Quote Originally Posted by a2a4raddo View Post
      Yes. However......untill you make that last payment...the car isn't really yours as the bank has legal claim against it. So you can't do anything you please with it....such as export it to a foreign country permanently or temporarily for that matter.

      exactly.

      people think that when you lease a car you don't "own" it. in all reality you do. but you only own 3 years of depreciation on it. the car is fully financed through whichever company foots the bill, at the end of the lease, they hope to recoup the remaining cost of the car (plus a profit) by reselling it as a CPO/wholesale/auction etc.

      so if a car was worth $50k and it had 50% residual after 3 years, they would lease it to you for $25k + interest for 3 years, then be able to sell it for at least $25k CPO or at auction. (its not concrete but thats the general concept)
      Looking for a new or used Volkswagen in NY/NJ/CT? PM me! I offer bottom line pricing! GTI Monster Mats & Gorilla Liner for Sale! http://forums.vwvortex.com/showthrea...la-Trunk-Liner

    19. Member dieselraver's Avatar
      Join Date
      Nov 11th, 2007
      Location
      Brooklyn NYC - Current Cars: - '15 VW Touareg TDI Lux '14 VW Autobahn/Nav GLI 6 M/T '01 Accord
      Posts
      12,513
      Vehicles
      Previous Cars: '12 Odyssey EX-L '10 Subaru Outback MT '08 BMW 328XI 6MT '08 GTI 6MT '07 Rabbit 5MT -
      10-03-2012 08:32 AM #44
      so i went over the numbers. the original lease was $366

      with the depreciation of the outback (offering me 17,000 for it and total payoff is 19600 so $19600 - $1700 = 2600) the number jumped to $461.

      thats a $95.00 discrepancy x 36 months = $3420.00

      he said its that high because of "tax savings" what on earth does that mean? can someone elaborate?
      Looking for a new or used Volkswagen in NY/NJ/CT? PM me! I offer bottom line pricing! GTI Monster Mats & Gorilla Liner for Sale! http://forums.vwvortex.com/showthrea...la-Trunk-Liner

    20. 10-03-2012 08:40 AM #45
      Quote Originally Posted by dieselraver View Post
      is lojack for $9.00 a month extra worth it?

      Dude, you want to pay for lojack on a car with $5000+ in negative equity? Don't do it! Believe me, the BEST thing that can hapopen is the car getting stolen or totaled. Your car gets paid off in full (with GAP) and now you can lease another replacement for $100 less per month.

    21. 10-03-2012 08:43 AM #46
      Quote Originally Posted by a2a4raddo View Post
      No, not at all. The vehicle is leased. It belongs to Honda. As bad as this sounds, it would actually work in your favor if the car is not recovered. Insurance will pay it off, most leases include gap insurance as well. I know Honda leases do. So you are off the hook. Now you can lease a new oddy and your payment will be much lower as you no longer have negative equity being rolled in.
      I posted mine before reading yours. How refreshing to see someone offering correct advice...

    22. Member MatchStick's Avatar
      Join Date
      Nov 16th, 2000
      Location
      CT
      Posts
      6,585
      Vehicles
      2013 WRX 2012 Mazda5
      10-03-2012 08:44 AM #47
      I have posted before, the way you can tell if you own a car - you have possession of the title, your name is on it and there's nothing under the lienholder section.

    23. Member Mike!'s Avatar
      Join Date
      Jun 17th, 2002
      Location
      Ontario & Ohio
      Posts
      14,456
      Vehicles
      2010 Mazda6 GT-I4
      10-03-2012 08:51 AM #48
      Quote Originally Posted by dieselraver View Post
      so i went over the numbers. the original lease was $366

      with the depreciation of the outback (offering me 17,000 for it and total payoff is 19600 so $19600 - $1700 = 2600) the number jumped to $461.

      thats a $95.00 discrepancy x 36 months = $3420.00

      he said its that high because of "tax savings" what on earth does that mean? can someone elaborate?
      No idea what the "tax savings" bit is, but on the surface that's effectively 18% interest rate on the $2600 for 3 years. It seems high.

      At the end of the day it's a matter of $820, and surely there should be at least some borrowing cost to them covering the $2600 shortage, but something about it sounds dirty to me. "Yeah sure, we'll cover the negative equity" and then squeezing extra money out of you.

    24. Banned SVTDanny's Avatar
      Join Date
      Aug 7th, 2005
      Location
      Winchester, VA
      Posts
      16,875
      10-03-2012 08:57 AM #49
      Quote Originally Posted by dieselraver View Post
      so i went over the numbers. the original lease was $366

      with the depreciation of the outback (offering me 17,000 for it and total payoff is 19600 so $19600 - $1700 = 2600) the number jumped to $461.

      thats a $95.00 discrepancy x 36 months = $3420.00

      he said its that high because of "tax savings" what on earth does that mean? can someone elaborate?
      Why wouldn't you just kick in the $2600 at the time of the deal? Jumping the payment by $100/mo for 3 years for negative equity seems really dumb.

    25. Member dieselraver's Avatar
      Join Date
      Nov 11th, 2007
      Location
      Brooklyn NYC - Current Cars: - '15 VW Touareg TDI Lux '14 VW Autobahn/Nav GLI 6 M/T '01 Accord
      Posts
      12,513
      Vehicles
      Previous Cars: '12 Odyssey EX-L '10 Subaru Outback MT '08 BMW 328XI 6MT '08 GTI 6MT '07 Rabbit 5MT -
      10-03-2012 09:35 AM #50
      Quote Originally Posted by SVTDanny View Post
      Why wouldn't you just kick in the $2600 at the time of the deal? Jumping the payment by $100/mo for 3 years for negative equity seems really dumb.

      Ideally i'd love to do that, but my millions of dollars is tied into Gold Bullion...

      in all reality, our car payment is $500 a month, we'd be going into a newer vehicle with a $40.00 savings, no negative equity at the end of 3 years trading up in 2.5/3 years for $366/month versus owning an outback after 4 years (one that doesn't suit our needs)
      Looking for a new or used Volkswagen in NY/NJ/CT? PM me! I offer bottom line pricing! GTI Monster Mats & Gorilla Liner for Sale! http://forums.vwvortex.com/showthrea...la-Trunk-Liner

    Page 2 of 14 FirstFirst 12345612 ... LastLast

    Posting Permissions

    • You may not post new threads
    • You may not post replies
    • You may not post attachments
    • You may not edit your posts
    •