My three year lease on a Honda Civic LX coupe is drawing to a close, and the purchase option price is a bit below $11000. It has 19000 miles, and has been problem-free. I’m leaning toward buying it, but I’d be interested in any thoughts you might have about how to make and execute this decision.
My advice don’t go for it…it has 19000 miles on it…plus you might have to pay a huge insurance on it…and also think of the resale price!!
The Civic is one of the most reliable vehicles on the planet, and 19K miles is nothing.
If you plan to keep the car, follow the maintenance schedule in the owner’s documentation and it will probably last you a long time.
There are Civics on the road with well over 200K miles on their odometers.
Leasing is an expensive way to drive, but that’s beside the point. It’s still a good car. Only you can decide.
A pretty expensive way to buy a car.
Pay rent on it for three years,
Then turn around a pay again, the used car value purchase price.
your choice .
It doesn’t matter how you got to this point, the only question is whether $11,000 is a good price for a Civic LX with 19k miles (as the others have said, Civics are very reliable). If it’s a 2008, that looks to be a GREAT price.
What year is it?
Thanks for the responses. The key insight is that it doesn’t matter how I got here, 11K is a good price for a 2008 Civic LX with 19K miles.
The poster who pointed that leasing is a less than optimal way to acquire a car is, of course, generally correct. There were financial reasons why leasing made sense for me, having to do with tax free reimbursement of leasing costs.
The Civic doesn’t make my heart go pitty-pat, but it’s a good daily driver. I’ll buy it. My kids will want it in a few years.
You paid, what, $200 a month on the Civic for the past 3 years?
That’s $7200 that you have already paid.
Add in the $11k balloon payment now, and not it is an $18,200 car.
Plus, whatever your original down payment was when you signed up for the lease.
So, when you add up all the costs, how much is the total for this Civic?
Yes, an $11k 3 year old Civic is typically a good find, but for you, it isn’t an $11k Civic.
“but for you, it isn’t an $11k Civic”
For the decision he’s making it is. No need to look at past costs, he could have paid $40,000 up till now, and the decision’s the same: is $11k a good price? The answer is yes.
Your calculations don’t take into account what the interest would be on a loan to buy the car. If the purchaser had the ability to pay cash then the numbers are OK, but very few people buy new cars with cash for the full purchase price.
With a lease the payment is for depreciation of the car plus service charges and profit for the financial institution. A five or six year car loan adds about $5,000 to the cost of buying to car. Leasing is more expensive, but not that bad if there are tax write offs for the lessee.
Bladecutter, I’m new here, but you’re wrong.
What if the OP had an opportunity to buy another, but identical Civic for $11K. You have described that as “typically a good find”. Should he not buy it?
Delaer retail on your car is #$14,000. That’s a great price, espeially if you took good car of it.
In this case I think the OP could come on a winner on this deal if she buys her own car off lease. The residual value of the car was determined at the start of the lease and is $11K. Since that was several years ago used car prices have gone up significantly so the current used car value of her vehicle is something like $15K. So, for her not to buy this car and get another used car doesn’t make sense.
Sometimes in the world of finance you win one.
How well did you do the maintenance over the years???
If you kept up on maintenance…and obviously you know it’s history (i.e. accidents and such). Then it sounds like a decent price.
Vehicle only has 19k…runs good…you like it…$11k is not a bad price.