Leasing a Car

civic
honda

#1

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?


#2
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.

#3

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.


#4

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.


#5

Leasing or buying is not the only choice. Buying a used car is better than both. Leasing can be a big waste of money.