A friend told me that when I lease a car it is actually worth it.
1. He said when you lease you don't pay the full amount of the car's tax.
2. At the end of the lease you can negotiate the price of the car, sometimes the price is lower.
Is this true? Should I lease the BMW? Or are there other factors I should consider?
2007-07-08 18:02:47 · 5 answers · asked by desperatehousewife 2 in Cars & Transportation ➔ Buying & Selling
"1. He said when you lease you don't pay the full amount of the car's tax."
- Depends on which state you live in. Some charge sales tax on the full value of the vehicle, while others only charge tax on the capitalized value of the lease.
"2. At the end of the lease you can negotiate the price of the car, sometimes the price is lower."
The purchase price at the end of a lease is called the "residual value" and this is negotiated up front as part of the original lease agreement. I suppose it's possible, but this presumes you're going to buy the car at the end of the lease (if so, why lease in the first place?) and that the dealer will be willing to negotiate (a big "if").
Dealers are going to make their money one way or the other. If they quote you a low residual value it's because they're charging you a higher monthly payment during the lease, and vice versa.
If you are OK with trading in your car every 3 years and having a perpetual monthly car payment, leasing may indeed be cheaper than buying & trading in. But keep in mind this is a very expensive thing to do; much more expensive than car ownership really needs to be.
2007-07-08 20:53:23 · answer #1 · answered by nevergonnaletyoudown 4 · 0⤊ 0⤋
I cannot comment on the tax situation, that varies state to state. I cannot imagine your local politicians have not found some way to get money out of the deal though.
A BMW is one vehicle I probably would not lease. Leases are very expensive to get out of early. Even if you stay in the lease the entire term, you still walk away with nothing. If you keep the car, you will need to finance it, and now you have 5 yrs of payments on a 3 yr old car. In essence 8 yrs of payments. And since BMW has such a great maintenance plan for the first 50k miles (everything is paid for), and hold their values so well, a lease is just not necessary. BMW is one of the few cars you will not get upside down on the loan.
2007-07-09 03:36:51 · answer #2 · answered by XUSAAAgent 5 · 0⤊ 0⤋
Look at your financial situtation, how many miles per year you can drive the car, along with the complete terms of the lease.
Bmw had a good lease going for their 335Ci, but some others are not so great.
The mileage in most cases is incredibly low, and you will probably need more than that alotted mileage. That can get expensive.
Maybe you should just finance a lesser car? like an Accord V6 EX-L. Still, a very nice car.
Like I said above, take a look at what will fit you best. Your finances should be key. Nice cars are exactly that...nice. They are not a neccesity.
2007-07-08 18:12:41 · answer #3 · answered by threelightsago 1 · 1⤊ 0⤋
Your better off getting a loan and buying it out right. if you lease it it will be around 1-10 dollars cheaper a month but you have to spend a few hours negotiating with a sales representative.
On the up side of leasing you can can get a different car if you dont like the car you have or you can just get a newer model. If you want to lease it and then you fall in love with the car then buy it out right, or try to convert it to a lease if possible.
2007-07-08 18:18:40 · answer #4 · answered by Anonymous · 0⤊ 0⤋
Dont stress over this one, leasing is much better. U get a new car every three years, its maintenance-free, and that itself is precious.
2007-07-08 18:50:48 · answer #5 · answered by Anonymous · 1⤊ 1⤋