Leasing a car

[Sirrahsim]

Pros?
Cons?
Things to look out for?

The 2008 Focus for $169 a month for 39 months seems to good to be true so it probably is but I can't figure out what the pitfall is. I would like some input from anyone who has ever leased or looked into leasing please

[Lady's Human]

Mileage and maintenance requirements, liability insurance rates are higher (Ford normally requires a $1 million liability rider), and when the lease is up you don't own the car.

[Sirrahsim]

I guess I should say that we are comparing it with picking up an older used car that may come with problems. We are looking for something we can afford and with a cap at $200/month that doesn't leave much wiggle room. We could probably afford a cheap used car up to about $5k but I don't know if that would be better or worse than leasing.

[Medusa]

It's been my experience that the pro is that you can get into a lease inexpensively, usually just the first and last month's payment. However, at the expiration of the lease, you still owe money on the car, at which time you can either purchase it or turn it in and lease another one, which doesn't make financial sense. If you lose your job or for whatever reason you can't afford the car any more, you still are responsible for the payments. You may be able to get someone to assume the lease but, if they default, the leasing company still comes after you. Cars are not an investment; they lose their value by 20% the second you drive them off the lot. I'd rather know that, if I come upon hard times, I can sell it. Hope this helps.

[Sirrahsim]

Fortunately job loss isn't a concern since my husband is in a high demand career in the military but I do see where you are coming from. What do you mean you still owe more at the end of the lease? Like if we decided to walk away at the end of the lease and buy a used car or something we would still owe something to Ford?

[Medusa]

What do you mean you still owe more at the end of the lease? Like if we decided to walk away at the end of the lease and buy a used car or something we would still owe something to Ford?

No, I meant that, unlike when you get to the end of the payments w/a car that you purchased, the lease won't be paid off. There will still be a balance. You do not owe that balance but if you want to continue w/that same car, you either have to lease it again, buy it outright (which makes no sense because you already paid on it for X amount of years) or lease another one. No, once the lease is fulfilled, you're done. For ex: my (then) husband leased an Acura legend for me. We made payments of $532 a month for 5 years. At the end of the lease, there was still a balance of something like $8,000, which is ridiculous. So I had the option of buying it and make more payments , turning it in or leasing another car. We walked away from it all and bought a car. Sorry if I confused you.

One thing I forgot to mention is that sometimes employers will lease a car for their employees and the employer makes the payments. As long as it's in the company's name and you have no financial responsibility or liability, then that's entirely different. But, again, should job loss occur, you're without a vehicle and no past history in your credit report. But, as you say, job loss isn't a concern.

[Laura's Babies]

I know nothing about leasing a car. My neighbor leases and has leased since I have lived here so for 7 years she has made "payments" but still don't own a car, that seems awfully silly to me. I looked into it once and thought they have to be crazy... I think you have to put a rather large sum of money up in the beginning and and the end? Your milage is limmitted or you pay. Research it on the internet.

Consumer reports, a good place to start
http://www.consumerreports.org/cro/c...ar-leasing.htm

This sigh should help with costs
http://leasing.carbuyingdiscounts.co...fdffd612062284

Leasing FAQ's
http://www.ertlecars.com/leasing_faq.php

[Cookiebaker]

I personally will never lease a car. At my last job, we used to lease office equipment to companies, and we got ALOT of profit through leases. In my opinion, its a win/win situation for the leasing company, and a total loss for the leaser. The leasing company gets the $ from the item sold, AND gets it back to resell at the end of term (many times in brand new/slightly used condition). If there is any damage or any repairs, the leaser paid for that as well. If at the end of the term, the person decided to keep the equipment, then they had to pay fair market value to keep it, basically paying for it twice.

You would be paying for a brand new car, and at the end of the terms, you don't own an almost-brand-new car to either keep driving or to sell. You have lost the investment.

[pitc9]

I've never leased a car and I don't think I ever would.
If I'm making payments on a car, I like knowing that one day it will be paid off and it will be ALL MINE!

But I know people that lease cars and always will. They figure that they'll always have a car payment so they might as well get a new car every few years.