Seeking Advice - Naperville, IL

My sister in law did it and hated it. Got slapped with a bunch of fines at the end for things broken and going over the millage allotment.

Brinker, a financial guy on 890am, says no to leasing--waste of money.
K.

You are going to be wasting a lot of money if you lease. You won't be tied to the car forever (though you WILL be tied to it for the length of the lease and will have to follow their requirements with mileage and all) and it will be a nice new car, but at a VERY high price compared to buying a car with cash. The BEST value when it comes to cars is buying a car with cash. And once you have a car paid off, all you need to do is discipline yourself to pay yourself car payments that is then money saved to buy your next car in cash. Then you are only paying the price of the car...not interest that is essentially money you have to pay for nothing in return. Your car may be worth just $2000 if you go to sell it, but it being a 98 Honda civic, it has a LOT more life left in it, so it will be the most financially beneficial to you to keep driving it. Think about if you leased a car, it would easily cost that in a year, but you could keep driving your car for several years. I've known people stuck in car leases that really didn't want the car they leased anymore, but they had to finish out the lease, so leasing won't get you out of being "stuck with" a particular car. Leasing is an idea that sounds good on the surface, but it really is not financially beneficial to the consumer. I hope that makes sense and helps with another perspective at least. Best wishes to you!!!

I have never leased myself but the finacial gurus who write books and do the TV shows say that leasing is the worst thing you can do. They say you are waisting money and not getting your total value.

M.,
I have leased my last 3 cars and LOVE it!! I love the fact that I can get a new car every 3-4 years.

I have found that my monthly payments are lower in comparison to financing to buy.

My last car was a Honda Civic and I leased another Honda this time. There was no down payment. Once your lease is up, the car dealerships fight for your business to re-lease so you can get a great deal! Since I stayed with Hondas, the re-sale value is so high, the dealerships WANT your used car back!

Good luck with your search. Do your comparisons online if you can. Some people love to lease, some people don't. See what is most beneficial for you!!
B.

I know you received a lot of good advice already but I had to respond because I have myself thought long and hard about the best financial decisions that go into car purchasing.

I beleive that the smartest decision is to BUY (not lease). This allows you to eventually own your car outright and therefore enjoy years of use without a monthly payment! Wouldn't that be nice! I don't know what your price range is, but I'm a firm believer that you should select a car that is at LEAST 1-2 years old. This way someone else pays the first 25-30% of the purchase price for you. (Usually someone who leased it and paid out the whazoo to return it!) It still feels like a new car, just has about 25-30K miles on it. Also, if you choose something like: Toyota, Honda or Nissan you will enjoy the lowest maintenance, the longest life and the best re-sale value. What else could you ask for?

The only reason I know that people choose to lease is so that they can get a new car every couple of years (not a smart thing to do), they sometimes have lower monthly payments (but pay a big upfront fee at signing, like 2-3K), and apparently they love to ALWAYS make car payments!

Be smart! Buy a Toyota, Honda, Nissan that is at least a year or two old. Pay it off & drive it free of car payments!

Good Luck!

M.,
A few things to consider about leasing a I too looked into it and thought it sounded enticing: you have to pay the sales tax on the total retail price of the car upfront plus usually a few thousand down for a total of $2000-$4000 down for a leased vehicle. Also, if you go over your mileage allowance per year you get charged a surcharge per mile, the contract is also very specific about maintenance and oil changes which must be done exactly when they specify or again you are penalized. I have seen some leases advertised for only so much down (maybe $1,500, but usually the cars are not available or are stick shift and are used to bate and switch customers with a higher priced lease once they get in there. I have never heard of anyone who leased a car outside of a person who gets a car allowance and writes it off for business expenses, that feels like they made out on the deal by driving a newer car every few years. The way I look at it, even though your 98 is six years old you can sell it outright and have $2,000 for a down payment on a new car, something you would not have with a leased vehicle. If you check on the internet on a specific make of car they sometimes have a quiz about finding out if you would benefit from leasing or buying, you may want to try that. Good Luck!

depends on how long you want to keep a car, and whether or not you want to make a monthy payment forever

leasing keeps you in a new car, and you rotate in a brand new one every 3-5 years, which is fun and cool, but you keep that $200-600 montly payment going, it never ends

buying you'll pay off a car in that same 3-5 years and then you OWN IT - you can keep it, sell it, make it a 2nd car, give it to a kid, etc. - if you buy for long term, from my experience working at carmax, the best brands for longevity are toyota, honda, nissan, and VW

with a 4 year old, and all the money you spend on him ( i have twins, so i know how expensive it is) you'd probably be better buying - i'd keep the civic, it WILL last probably 200k miles, and buy a 2nd car that is bigger for the expanding family - i like the camry a lot or the pathfinder is a great suv - hybrids may not be cost effective YET, but there are incentives

good luck,
richard

No personal experience here. My husband use to be a mechanic, so we pay for our cars up front, and he fixes them if they need something. No car payments, is a great saving every month.

However, I remember this issue from a Suze Orman show. Here is a link to an article she has on her Yahoo Column.

http://biz.yahoo.com/pfg/e16buylease/

Also--
I am assuming that $2,000 is trade in value. I would check Kelley Blue Book first, at www.kbb.com for value on your car if you were to sell it yourself(private party). In fair condition, a 98 civic EX gets around $5k. You can list your car for sale on www.autotrader.com. We did that about two years ago for our bonneville and I think it was around $50, and you could renew the ad for free until the car sold, and it came with 9 photos.

Best of luck, Hope you get the most for your money,
Melanie

Leasing to me is like renting, you pay the same you would for a mortgage, or for buying a car, but at the end of it, you walk away with nothing. At least your car you can get 2000 towards a trade in, when you are done leasing, you are left with nothing, no trade in, nothing. That is my thought on it, I would buy a car instead of leasing.
M.

Hi M.,

We are in the second year of a three year lease on a 2005 Nissan Maxima. This is the third car I have driven, having bought my last two (both Saturns.) The thing I like about leasing is that we were able to afford a rather pricey (in my opinion) car but pay a lot less per month. We also have the option at the end of the lease to buy the car outright or get a newer model for, again, less than what it would cost to buy it over 5 years. The downside of this is that the car is not ours to keep, sometimes I feel like I am renting a car (which is what a lease really is) that I don't get to keep, and I have to be careful not to go over the allotted 15,000 mile-per-year quota. My mother-in-law leases her Cadillac STS and when she leased her first one, she went over the mileage. The dealer didn't really care that she did, he just wanted her to lease another Cadillac, which she did. We plan to lease our next car, the 2008 Nissan Maxima or get a Nissan truck. Either way, I am happy with our decision.

Just another story to help with your decision. Good Luck!

S. S.