My husband and I need a new car (old one was stolen and cannibalized) for about 3 years only. What experience have people had or what advice can they offer about leasing a new car?
Leasing makes economic sense for some business situations. It seldom is a good economic tool for obtaining a car. Usually a conventional loan will cost you a lot less in the long run. Of course cash is the cheapest method.
If you can write off some of the lease expenses as business expenses a lease can make financial sense. If you are a salesperson without reimbursed sales expenses a lease can work for you.
Otherwise, not a good option. A lease is a lessor monthly payment, but you’ll end up spending more the car in the long run. Still, to get a reliable car with the lowest monthly hit on your budget is the “lure” of a lease. Look carefully at the allowed miles on the lease contract. If you exceed these miles then you a pay an expensive penalty. A lot of folks feel 12K miles a year isn’t a problem, but if you commute and use the car daily you will burn through 12K miles a year in a big hurry.
If you know exactly how long you’ll need the car, you can avoid some of the risk associated with buying, but only if the time is exactly known. It’ll cost you a little extra money compared to buying new and selling. However, leasing will cost a LOT more than buying a 2-year old car and selling it when you’re done.
Leasing or buying is not the only choice. Buying a used car is better than both. Leasing can be a big waste of money.