leasing a car

Discussion in 'Chit Chat' started by deviltrader, Mar 13, 2007.

  1. I've always purchased my cars with cash, but for the next car I'd like to lease it for 24 months with as little down as possible. The reasoning is that I don't want to tie up capital in the car, especially a car with a high price tag. There are a number of websites that give lease quotes. What are some tips for leasing? (especially an "exotic")
  2. ajna


    Good free leasing guide is leaseguide.com. Covers the basics.
    Edmunds gives reliable invoices so you can negotiate better with dealers.
  3. Doesn't the way you structure your income (through a corporation or not) determine how much of a lease you can write off? If you're interested in leasing an exotic, I assume your income is flowing through a private corporation of some kind. I believe there are some minor tax implications that you should know about.
  4. Is this to preserve cash flow or for tax purposes?

    And out of curiosity, what model are you looking into? :)
  5. Number 1 rule ... EXPENSES depreciate. A car is an EXPENSE.

    There's a simple rule of thumb. Much like a competent CFO would create the capital structure of his corporation....YOU NEVER BUY AN EXPENSE.


    Then you use your the generated revenue to pay for your expenses.

    Thus .... you ALWAYS lease or rent your expenses. You ALWAYS lease or rent your cars. To otherwise is moronic and an inefficient use of your revenue. Assuming of course that you're skilled enough to generate a higher rate of return with your assets than your interest cost capital. Though if you're not you should not be trading for a living.

    Of course Don Bright doesn't agree with this. But he was a CPA...so what can I say. :D

  6. lindq


    Don't open your conversation with a dealer by telling him you want to lease. Negotiate price first, and the lease payments will be structured on that.

    If they ask you "buy or lease" when you first begin looking at a vehicle, just tell them you haven't made up your mind, and the overall price is the most important thing to you.

    Dealers just love it when someone walks in and announces they want to lease. An invitation to a sucker deal.
  7. Doctor Z: Great advice as always!

    I'll post a link when I get home but on Edmunds message board (I think) there's a section where guys are very specific about what they've paid on leases. My parents leased an STS several months ago and I got them a great deal by using that info. lindq is very correct. Find out on Edmunds what a 530i (for example) is selling for, what BMW's lease rate is, the residual and voila you know the "arb" value of the lease.

    Another terrific option is leasetrader and swapalease. These are new forums for people who are trying to get out of their existing leases. If you're flexible as to what car you'll drive there's always something trading on the bid. Unfortunately many of the cars only have several months left on their leases.

    Another viable option is locating a lender who will allow you to lease a pre-owned. You find the car and the bank pays the seller. The equation is simple. Purchase price minus residual value x interest rate divided by 36 months (usually 36 is required).
  8. Hey, that's why the broke stay broke and the rich get richer. (and they always have new cars).

    I don't know anything though, I'm 24 years old and essentially broke myself...

    This is how I explain Option Arm (MTA or COSI index of course no LIBOR ARMs). But you know who are the hardest people to explain this concept to? THe 'highly educated.' I've said it before and I"ll say it again.. PhD= Permanent Head Damage. Life gets rough when you're always bitter about having all this 'education' and you're still broke.....
  9. Yes sir, leasetrader is awesome. I have buddies who have picked up some pretty sweet deals on there. :) Solid advice!
    #10     Mar 15, 2007