No, I haven’t. Your attempt to insult me has missed the mark.
And you, as usual, have not posted for the purpose of contributing anything to the discussion.
Your posts are personal attacks. Not contributions.
A monthly payment to buy the car new on a 5-year loan would be about the same as the monthly payment to lease one for three years (including an amortization of the original $4K “down”), and the owner would be building equity. And the owner really would be the owner, with all the rights and freedoms of ownership. Deduct the equity value after five years and the monthly payments come out much cheaper.
Put another way, if you want to compare the lease payments to buying the car, you need to factor in both the 4K “down” on the negative side and the final value the car will accrue if it were purchased on the positive side. An assumption has to be accepted with a lease that either the car will need to be purchased at the end of the lease or another lease will have to be entered into, meaning payments will continue at least past the period in which the purchased car would have been paid off. And if the car is leased, a realistic analysis would also have to assume and factor in another $4K “down” for the next lease. Done that way, and that’s the only correct way to calculate it, the lease is a lot more expensive.
No calculation that does not factor in the vehicle’s final value if purchased, and the cost of continued lease payments until at least the point where the original car would be paid, off is correct. Nor is any calculation that ignores the reality that once the lease is up, There’ll probably be another $4K “down” to replace it… or a purchase agreement.
With a lease, the payments will never end.
Now, disagree if you like, but don’t post for the sole purpose of insulting me. I know that’s just who you are, but I’m sick of it.
This car is going to depreciate $25,000 after 3 years, it doesn’t matter if the down payment is on the lease or purchase, the outcome will be nearly the same.
True, but those charts compare only the first three years. They’re designed to promote leasing. Beyond that first three years, the balance changes. Extend the figures to five years under the assumption that the leased car will need to be purchased or replaced with a new lease after the three year period and the true cost of leasing becomes more clear. Beyond five years, a typical new car loan, the leased car becomes far more expensive than the purchased car.
When I was young, if your car was approaching three years old or 100,000 miles, you needed to be looking to replace it. But cars no longer last only three years or 100,000 miles. There’s no reason why an owner can’t enjoy a decent car for five or even ten years today. Most cars that get traded today in three years probably are getting traded because the owner’s needs changed.
What if the lease can written off as an expense? It seems like the OP could easily be a professional able to write off the lease. Since that comes off income, it could be advantageous from that viewpoint. We don’t know whether this applies to the OP, but we also don’t know that it doesn’t.
I can see the motivation for leasing. You just pay the monthly payments, which you know what they are in advance, use & enjoy a brand new car for 3 years, then turn it in at the end of the lease and lease another brand new car for another 3 years. No worrying about out of warranty expenses, cars that won’t start, trading the old car in for a new car, or where to sell your old car. There’s a lot to be said for ridding yourself of all that. I mean if you’d rather spend your time doing other stuff or making money other ways than saving on car expenses. You do miss out on the part where you lay under the car covered in grease and oil with a flashlight at midnight and wonder what’s wrong though … lol …
That’s true.
When it’s a business expense it’s accounting is entirely different. The lease cost becomes fixed overhead, and the operating costs become variable overhead. It all comes directly off of the gross revenues, reducing gross profits before taxes.
If the OP is a business person leasing this under the corporation, he/she really needs to talk with his/her accountant. Only the accountant, with eyes on the “books”, can judge the best way to do this.
I should probably add that if the car is or business purposes, the motivation for it may also be entirely different. There’s an old axiom for business people that you should always appear more successful than you actually are. That can make a big difference to a potential client/customer. Unless, of course, your customer base prefers frugality… or environmentalism.
One of my relatives is/was a realtor. She always felt she should drive a fairly high-end car, no more than a few years old, and it should look immaculate at all times. She once traded in a 12 year old luxury car in perfect shape, didn’t need anything, because it was “too old” and didn’t scream success
Unfortunately, that approach did NOT translate to more business coming her way. She also wasn’t very aggressive in seeking out new customers. She was never very big on fliers, business cards, websites, or other things to promote herself. Every time I visited her, I never once saw a poster, billboard, or anything at all with her name on it, in her neighborhood or in her town. Yet where I live, I’m bombarded with fliers and such things from all the local realtors. I can’t pass a park bench or a bus stop, without seeing a poster with a realtor’s face on it.
Back in the late '70s my brother bought a Ford pickup. He was a partner in an excavating company in a rural town, and if he showed up to talk to construction people in a foreign pickup nobody would have even spoken to him.
When in business, the vehicle you drive does matter. But, like everything else, nothing is 100%. Sorry about your relative.
There can be local pressure like that, remember opening a restaurant in ND, I had C&H sugar packets, ND is sugar beet country, and switched to Crystal sugar to appease the natives, “We want ND Sugar beet sugar, Not the sugar cane sugar from Hawaii or wherever!”
I guess it depends on the business. If a relater shows up in a Lexus or Mercedes, their client may assume they are well to do and be firm on their low ball offer because the relater is obviously doing well as it is if they can afford that Lexus/Merc, and don’t need a huge commission. If they show up in a Ford Fusion or Chevy Equinox, their client might up their offer a bit more because the relater looks like they could use a little more money.
What’s a “relater”? Is that the same as a “retailer”? Or is it a “realtor”?
With respect, I’ve asked that as an honest question. I’ve never heard the term except to identify someone who verbally passed something on to a third party.
When I go to buy a house, and I’ve bought a few, I prefer to see someone who inspires confidence in me that they’re experienced. That may not be a good strategy on my part, as realtors seem to accumulate more unsavory tricks as they gain experience.
I suspect you don’t know many realtors ( if that is what you meant ) the contract offer is all that matters between seller and buyer. The realtor is just a go between and many states regulate the commission rate .
Not exactly. The realtor in most cases is the seller’s selling agent, and in most cases gets paid by the seller as a commission. Any successful realtor will try to keep the selling price as high as possible, usually against an inflated advertised price, in order to get larger commissions. Even if you went to a realtor to help you find a house, they get paid by the seller… and they’re well aware of it. A good one will act like he/she is working for you as the buyer, but they know well which side of the bread the butter is on.
I know! I wish I could turn it of since I have to correct autocorrect so often.
Realtors get paid when the deal goes through. While they can get a little more when they keep the price high, they don’t get paid at all if there’s is no deal. Typically there is a seller’s agent and a buyer’s agent. They might be the same person, but that is rare. When we sold our mother’s house, the buyers kept nickel and diming us. Our agent brought the new, lower offer every time we agreed to something. After a couple rounds, I said I was tired of the crap and wanted to raise the price. If they buyer didn’t like it, they could walk. It seemed to me that our agent was working for the buyer at that point. This was at settlement, BTW.
