My ACTUAL Lease dollar amounts & comparison to purchase

[evnow]

Is that really the case? Wouldn't insurance pay the lien-holder the value of the car? Then they would subtract the residual and give me the rest? Not really sure how this works, but I have heard before that paying off a lease early is "risky". I'd like to fully understand why.

There were threads here where we discussed this.

It is not very clear - some say we will get back the money - others say, NMAC will ask for the book value and receive that from the insurance.

I've insured for "replacement value" - so that might cover it. You may want to check with the insurance company.

 

[DrPowell]

If you're leasing, ask your auto insurer to quote you the price of "gap insurance" which pays the difference between the artificially low residual value car companies quote to make lease payments cheaper, and what the car would actually be worth if it were totaled.

Or, just keep that much cash in the bank.

 

[Anonymous]

Same rules apply whether it's an 80k Mercedes or a $35k Leaf. The big issue is resale value. Nobody knows how much value the Leaf will lose in 3 years. It could be a small percentage, it could be huge, there are too many factors that could come into play.

Rule is the same, but $$$ are different.... would you rather loose 40% value on a $80k Mercedes or even 60% value on a 25k Leaf (after rebate)?

I still argue it's the same. It's still a focus on percentages, not necessarily the actual dollar value. A lease on an 80k vehicle is going to be significantly more than on a 35k vehicle as well, so it's basically that all the numbers just get bigger. The percentages are likely to stay the same. If the Leaf was an 80k vehicle, I wouldn't be in the market for it, the same reason why I was never in the market for the Tesla Roadster. To me, 80k and 120k are essentially the same, because they're both unobtainable. The Leaf is in my price range, so that's my target.

Think of it this way: $1000 isn't that big of a deal when you're talking about $35,000. Likewise, if you were buying a personal jet for $2,000,000, then even $60k isn't a big deal. They're essentially the same percentage. Using the same notion, $1000 on a cheap $8,000 vehicle IS a big deal, as it's a much higher percentage.

 

[linkim]

So there it is.. a gamble that I will not be able to sell the LEAF for $13,000 in three years.
IF the car is worth more than $16,000, I can buy it out and resell it.
IF the car is worth less than $13,000, then I'll give it back to Nissan and delare #Winning.
IF the car is worth between 13,000 and 16,000, then I will have paid a bit more by leasing, but such is the nature of insurance.

I purchased my LEAF so don't know much about the leasing option. I found an article that mentioned the retained value after 3 years - http://cars.uk.msn.com/news/articles.aspx?cp-documentid=157407929:

"It will retain 35% of its value over 3 years and 36,000 miles."

I don''t know if this helpful to the thread but the article also mentions the retained value if the battery is purchased with the LEAF or leased.

 

[wwhitney]

The purchase option is $15,800, so the "premium" for leasing is $3,075 (not counting TVM).

Does this purchase option figure include the sales tax on the residual? That is necessary for a fair comparison.

Wayne

 

[Coffee_Slurry]

The purchase option is $15,800, so the "premium" for leasing is $3,075 (not counting TVM).

Does this purchase option figure include the sales tax on the residual? That is necessary for a fair comparison.

Wayne

That's an excellent observation. I neglected to include that.
Sales tax on the residual (8.75%) makes the buy-out $17,157, which increases the "lease premium" significantly.

$15,501 residual
  1,356 CA tax on residual
    300 purchase option fee
-------
$17,157 buy-out

 

[electriclarry]

I need some help from you lease pro's. I am not sure a lease makes sense for me. I may? drive about 5,000 miles a year. On week days I am public transit person. I notice most leases are geared for 12,000 miles a year.

Can I get a lease that is limited to 5,000 miles a year, 15,000 total and if yes, what would the savings be?

I know enough about a lease if I bring back a car with less than the allowed mileage amount the finance company will not even say thank you, but if has a small ding they will say $2,500.

I walked by my local credit union and was surprised to find out the auto loan rate was 1.99%. San Mateo Federal Credit Union, I hate to ask, but anything better than that?

Thanks

 

[Boomer23]

I need some help from you lease pro's. I am not sure a lease makes sense for me. I may? drive about 5,000 miles a year. On week days I am public transit person. I notice most leases are geared for 12,000 miles a year.

Can I get a lease that is limited to 5,000 miles a year, 15,000 total and if yes, what would the savings be?

I know enough about a lease if I bring back a car with less than the allowed mileage amount the finance company will not even say thank you, but if has a small ding they will say $2,500.

I walked by my local credit union and was surprised to find out the auto loan rate was 1.99%. San Mateo Federal Credit Union, I hate to ask, but anything better than that?

Thanks

I may be able to help with your question a little bit.

When I signed my lease papers I asked them to check on the monthly payments for a 10K, 12K and 15K miles per year lease payment. There was a (small) difference in the monthly payment between the 12K and 15K mile monthly payments, but they told me that the payment for 10K miles per year was the same as for 12K miles per year. That sounds bogus. I have experience with leasing a BMW and they definitely have lower monthly payments for 10K mile per year leases vs 12K miles per year. However, at my Nissan dealer, they were apparently punching the numbers into some computer program, and they said there was no difference.

So I really doubt that they would even offer a 5K mile per year lease.

 

[Coffee_Slurry]

Right. The difference between 12k and 15k miles annually was $11 a month.

Basically, the amount of "prepaid mileage" impacts the Residual of the car.. 45% and 44%, in the case above.

While it's a disaster to go over the mileage (at some ludicrous rate), it's expected that you don't use all the miles. That's just part of the deal.

Really, a 3yr-old used car with 12k miles is almost identical to a 10k mile car anyway. At that point, the amount of Arby's you ate in the car makes more difference than the extra 2,000 miles.