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3 footin' through life
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How bout never being upside down on a loan? Therefore not needing gap insurance.

How bout buyout options which ensure that you don't pay more than the total cost of the car?
 

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How about the mileage charge ? Average charge is over .15 cents per mile over allowed usage. That would be another $3K per year minimum for me. How about wear and tear that for some reason is considered beyond normal? Unless I was leasing a sunny Sunday vehicle the costs are far too high and not nearly as clear cut as the dealer would have you believe. Especially if it turned out I didn’t want the vehicle at the end of the lease.
 

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3 footin' through life
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There is no mileage overage charge if you buyout through FCA
 

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What’s the sense in leasing then? You may as well have bought it outright to begin with. Probably at a more favorable interest rate.
 

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Make no mistake; The bank, dealers or car manufacturers are not your friend.

Lease, rent or buy, they are out to make money. Nothing wrong with that but the fine print is where they get you either BIG or small. Lol
 

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3 footin' through life
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What’s the sense in leasing then? You may as well have bought it outright to begin with. Probably at a more favorable interest rate.
Just spreads out the expenditure over 9 years vs 6 if you take the longest terms on everything. Example: We have now bought 2 new Grand Cherokees. Both roughly $44k. Bought one on a 72 mo loan and its paid now. Newer one is leased. The lease results in $220 lower payment for the lease term and about $300 lower for the loan term or alot more car for the same payment and very little additional total cost. For those of us who have fairly static income but plan to work 40 more years it works great. hahaha Maybe you know but a $640 car payment hurts alot more than $420.

Effective lease interest rate comes in below .5%. And you get to guarantee yourself you don't have a lemon because many leases include service rentals. Small price to pay to have a 3 year test drive on a car with absolutely zero risk of additional expenses. If you use Chrysler Capital for the lease buyout there are also other incentives available that would not be through normal banks such as continued 0% interest.

Another side benefit, you get to implement and pay for the extended warranty at the lease buyout. So you've had a chance to really research and decide if you actually need the extended warranty or not.

Finally, Leasing has a much smaller impact on temporary credit. So if you are looking to refi or buy a home, you are much better off to be mid lease than be upside down on a hefty loan. This is a main reason we choose the lease on the 2nd car.

And the most powerful piece of anecdotal evidence, many large, very successful companies lease for these reasons. If it were not cost effective they wouldn't do it.
 

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everyone I know except one person has taken big hits on leases.
I know of 2 people right now that have leased cars parked because their wives ran up the mileage and they do not want to pay the mileage charge.
One person is going to have it sit for a year.
 

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3 footin' through life
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Obviously leasing and racking up the miles is terrible. If you can't buy out or choose not to you get absolutely ripped. This is why we keep miles in check on the lease even though we plan to buy out. If life happens and we can't buy out we lose nothing.


If you’re financing for 9 years we have no more to discuss.
Amortization and/or depreciation schedule. Look it up some time. :thumbsup:

We finance our equipment at work for 7-15 years depending if it ranges from $100k to $2mil. If its more expensive than that allows then we lease. Same same... Time is not a negative factor.
 

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Obviously leasing and racking up the miles is terrible. If you can't buy out or choose not to you get absolutely ripped. This is why we keep miles in check on the lease even though we plan to buy out. If life happens and we can't buy out we lose nothing.




Amortization and/or depreciation schedule. Look it up some time. :thumbsup:

We finance our equipment at work for 7-15 years depending if it ranges from $100k to $2mil. If its more expensive than that allows then we lease. Same same... Time is not a negative factor.

Don’t flatter yourself. I’ve been financing equipment for the last 35+ years. If you really understood the situation you wouldn’t finance 5 year property for more than 4 years. Financing long term equipment is far different than long term financing on a short term investment.
 

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Leasing - Aussie Style

Leasing makes a lot of sense in Australia. I'm leasing my RAM 2500 Cummins and did so with my VW Amarok V6 TDI before that. All lease costs, fuel, servicing and maintenance are paid out of pre-Tax dollars. If it's a car you pay 20% fringe benefits tax (FBT) to the ATO (our IRS) compared to maybe 30-45% income tax. If it's a truck/ute/pickup/SUV then you pay no tax as it's FBT exempt. A few years ago there were mileage considerations but that's all gone now. The net effect to me is that I use the Ram for work and pay about 4-5% for the lease (interest and administration) and pay for it all out of pre-tax dollars which saves paying 45% income tax on that amount.

This scheme was bought in in the 1990s to save our local car industry, and only applied to locally built cars, but now Ford, GM, Toyota and Mitsubishi have all stopped local manufacture but the leasing scheme remains and applies to imported cars. Maybe you guys (and gals) could convince your local representatives to get the Trump administration to bring something like this in, although it might end up being a state by state thing.

Leasing gets a big thumbs up from me.
 

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Australia aside.

Broaner is right on some issues but not on some.Be known I sold Dodges for 17 years.

First it is not true that you will never be upside down on a lease. In fact you are often further upside downif you do any of the following: First you are obligated for the payments for the full term of the lease, always. Second roll over from a previous upside down is part of that. You wnat out early included. You go over miles. You crash it and it is not worth what you owe on lease plus residual(reason for GAP). The only time you are equal or ahead is at end of lease and on point or better for miles.

Good reasons for lease and best methods:

IF "Money rate(lease interest) is a lot better than purchase rate. Sometimes common on good specials, but not usually otherwise.
If you are going to match miles.
You are buying a vehicle with a good residual and reseal value.
You are business with multiple vehicles and want newer ones all the time on warranty.
You are always good on miles and want a newer vehicle often and will keep them to end of lease for sure.
Know you wall always have a payment and have the necessary down for rewind.
NO 0 to one percent interest rates are available for purchase.
You can do and understand the math of both lease and purchase.

Many people are pushed into 60 month leases on the basis of lower payment to buy too much vehicle and the want out in 3 years and are $10,000 upside down, often based on negative balance from prior trade in.

So leases are fine if you fit the "profile" and can sometimes save some money or convince but make sure you are committed and it is right for you..
 
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Bigfish I agree, that's a problem here to. Once you sign the lease you are obligated to the all the remaining lease payments, even if you want out shortly into it. Have an accident and you do need insurance to cover the gap. i.e. all the lease payments. And for those people who say they want to lease and then buy at the end, be careful of how big the residual amount is. If it's too big and people still want the truck, they are often bundled into a follow on lease. You are so right in that you must fit the "profile" to make best use of the lease.
 

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I’ve leased 4 vehicles in my life. I only came out ahead (maybe) on one of them.

All of the others I had to pay at the end of the term for the “pleasure” of giving their vehicle back to them.

I’ve paid cash or short term financed since then.


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I forgot about turn in fees.. Some have them , I do not remember Chrysler ever having them.
 

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Mike, short term finance at the right rate might be best, especially if the lease is a business cost. I mentioned that we have tax advantages of paying for a lease out of pre tax pay, but you can't pay off the full vehicle during the lease period. There is always a "residual" and the shorter the lease the larger the residual. I'm doing my 2500 HD over three years but will still have about 55% to fork out at the end of lease.
 

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3 footin' through life
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Good info. Thanks.

In my eyes, Insurance is turning out to be the biggest con of leasing. They want a huge increase of liability protection. Progressive is requiring $300k coverage. You could argue you are protecting yourself with that money sure. But for somebody in my situation, the extra liability is required to be carried for all vehicles on plan(At least through Progressive). This results in +$70/mo and makes it signicantly closer to the full purchase payment for total monthly expenditure. We'll be buying from here on out but It will be a long while before I plan to buy anything brand new again due to both of us being in our planned 20 year cars. :thumbsup:
 

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Mike, short term finance at the right rate might be best, especially if the lease is a business cost. I mentioned that we have tax advantages of paying for a lease out of pre tax pay, but you can't pay off the full vehicle during the lease period. There is always a "residual" and the shorter the lease the larger the residual. I'm doing my 2500 HD over three years but will still have about 55% to fork out at the end of lease.


I hate debt so I short term finance (if I can’t or do want to pay cash) to get the debt out of my life as quickly as possible.

I’m not familiar with how much a business can write off on a purchased vehicle vs a leased vehicle. It may well make sense to lease in certain business situations but I’ll never do it again on a personal vehicle.


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