Car leasing

[thornz]

Anybody here ever leased a car, one that is a fully maintained lease, so you dont actually own the car, just effectively renting it for a set amount of time. Is it a effective way of owning a nice car, or are you better to finance something to own it outright?

The idea of leasing sounds quite attractive, every however many years the lease is, you can upgrade to a new car, but am guessing that there must be some cons to the idea as well ie never actually owning the vehicle. However after you take into account operating costs and depreciation, has anyone got any idea how it would stack up against financing to own?

Anyone work in the idustry and could give any guides to it?

[dnalunchie]

I looked into it, its cost effective but only if you are someone that buys cars that are less than 5 years old and you regularly upgrade them.

Essentially for someone making a decent amount of money who buys a 2-3 year old car every 2nd year or so it is cheaper to simply lease as the depreciation for a car in those first 5 years is the most severe.

If your no one of those people then buying a 4 or 5 year old car which has already lost more than 50% of its "new value" and then keeping it for 5+ years works out more cost effective.

[fangsport]

Mr lunchie, do you have pics to prove your theory??

[MR2BOY23]

LOL ^

[dnalunchie]

Mr lunchie, do you have pics to prove your theory??

.........

[fangsport]

Not just cars , either

Leasing versus Purchasing

The mathematics on the Paul McCartney-Heather Mills divorce is as follows:

After 5 years of marriage, he paid her $49 million. Assuming he got sex every night during their 5 year relationship (which would NOT have happened!) it ended up costing him $26,849 per time.

On the other hand, Elliot Spitzer's call girl, Kristen, an absolute stunner with a body like no other, charges $4,000 an hour. For anything!

Had Paul McCartney 'employed' Kristen for 5 years, he would've paid $7.3 million for an hour of sex every night for 5 years (a saving of $41.7 million).

Value-added benefits are: a 22 year old hot babe, no begging, no coaxing, never a headache, plays all requests, ability to put BOTH legs around you (!!!), no bitching and complaining or 'to do' lists. Best of all, she leaves when you're done, and comes back when you ask her. All at 1/7th the cost, with no legal fees.

Sometimes renting makes far more sense.

maybe i could 'lease' the pictures of said sister???

[dnalunchie]

Not just cars , either

Leasing versus Purchasing

The mathematics on the Paul McCartney-Heather Mills divorce is as follows:

After 5 years of marriage, he paid her $49 million. Assuming he got sex every night during their 5 year relationship (which would NOT have happened!) it ended up costing him $26,849 per time.

On the other hand, Elliot Spitzer's call girl, Kristen, an absolute stunner with a body like no other, charges $4,000 an hour. For anything!

Had Paul McCartney 'employed' Kristen for 5 years, he would've paid $7.3 million for an hour of sex every night for 5 years (a saving of $41.7 million).

Value-added benefits are: a 22 year old hot babe, no begging, no coaxing, never a headache, plays all requests, ability to put BOTH legs around you (!!!), no bitching and complaining or 'to do' lists. Best of all, she leaves when you're done, and comes back when you ask her. All at 1/7th the cost, with no legal fees.

Sometimes renting makes far more sense.

maybe i could 'lease' the pictures of said sister???

huh, that was actually quite clever.

[Mr Revhead]

Mr lunchie, do you have pics to prove your theory??

.........

There is only one way to make it end....

[eskimo]

Mr lunchie, do you have pics to prove your theory??

.........

There is only one way to make it end....

Yes.. lunchie its time............................please

[Brick]

I hope she isnt from dunners to... I heard girls down south have hairy backs

[Al]

Anybody here ever leased a car, one that is a fully maintained lease, so you dont actually own the car, just effectively renting it for a set amount of time. Is it a effective way of owning a nice car, or are you better to finance something to own it outright?

The idea of leasing sounds quite attractive, every however many years the lease is, you can upgrade to a new car, but am guessing that there must be some cons to the idea as well ie never actually owning the vehicle. However after you take into account operating costs and depreciation, has anyone got any idea how it would stack up against financing to own?

Anyone work in the idustry and could give any guides to it?

The best way to lease is to write it off as an expense to your company, that way you aren't tying up capital and you cut down the amount of tax you pay.

Leasing IMO isn't the greatest option for an individual.

[levinguy]

Anybody here ever leased a car, one that is a fully maintained lease, so you dont actually own the car, just effectively renting it for a set amount of time. Is it a effective way of owning a nice car, or are you better to finance something to own it outright?

The idea of leasing sounds quite attractive, every however many years the lease is, you can upgrade to a new car, but am guessing that there must be some cons to the idea as well ie never actually owning the vehicle. However after you take into account operating costs and depreciation, has anyone got any idea how it would stack up against financing to own?

Anyone work in the idustry and could give any guides to it?

The best way to lease is to write it off as an expense to your company, that way you aren't tying up capital and you cut down the amount of tax you pay.

Leasing IMO isn't the greatest option for an individual.

what about fringe benefit tax though?

[gtpornstar]

Fringe benefit tax is a completely different topic which is present weather you lease or buy. And basically is there for anything the company owns or has rights to that you use for personal use.

I am a biz owner and suggest the same as what Al says.

[S T E A L T H]

Anybody here ever leased a car, one that is a fully maintained lease, so you dont actually own the car, just effectively renting it for a set amount of time. Is it a effective way of owning a nice car, or are you better to finance something to own it outright?

The idea of leasing sounds quite attractive, every however many years the lease is, you can upgrade to a new car, but am guessing that there must be some cons to the idea as well ie never actually owning the vehicle. However after you take into account operating costs and depreciation, has anyone got any idea how it would stack up against financing to own?

Anyone work in the idustry and could give any guides to it?

Couple of pointers:

1) Fully Maintained leases are almost always a ripoff (unless you do really high mileages). Difference in monthly lease payments for maintained/ non-maintained average at around $130-150/ month. If you take a 36- month term, which is pretty much the most common, that works out at around $4700 over the term. The chances of you spending that much on maintenance of a brand new car in the first 3 years of its life are very low (unless you chew through your tyres or something...)

Also within the maintained leases there are criteria such as:
- Roadside assist (make sure you DONT pay the lease company fort this as pretty much all manufacturers provide this free of charge for 3 years now)
- Number of replacement tyres youre given (you can choose to buy your own)
- Relief vehicle, accomodation etc (waste of money IMO)

2) Get quotes from a few lease companies, as they do differ singificantly. Those who own their own car yards (such as Orix, or Fleetpartners (Esanda) tend to be more competitive as they can sell their own cars after you give them back, so in effect they inflate the residual value and therefore have a bit more room to move on the monthly repayments. Those who dont have their own dealerships are basically at the mercy of other dealers when it comes to the value of the car when you hand it in thrashed and f$#ked 3 years later


Financing the car (lease to buy) is a mugs game IMO, most people I know that have done it (myself including) were almost always in negative equity by the end of term (you have a big balloon payment at the end). Especially considering the interest rates are on the rise at the moment (and will go up significantly more in a month or so)

[eskimo]

Also got to watch lease company's if anything happens to the vehicle...stolen in an accident etc things can take forever to get done.

We had a company car stolen and recovered within two weeks but didnt see the car for 3 months while orix and the insurance company sorted their Sh!t out

[AsD]

[quote="Al[/quote]

The best way to lease is to write it off as an expense to your company, that way you aren't tying up capital and you cut down the amount of tax you pay.

Leasing IMO isn't the greatest option for an individual.[/quote]

this guy is right, i'm an analyst in one of the lease companies thats been mentioned in this thread several times.

there are minimal benefits for an individual to lease a car (that is if you can even pass through the credit requirements as most leasing companies are becoming more stringent on individuals).

if you do lease, you should clearly think about the exact terms that you will be doing as you don't want to be paying excess km charges (which is typically quite high as it covers the vehicle's depreciation and maintenance, along as pinging you as well). Think about whether you have the cashflow to continue with the payments over the lease as you don't want to be early terminating the contract as it may be quite a hefty amount.

Maintained leases can be possitive as since its a new car, you are required to maintain the car according to its service intervals and at specific dealers. Leasing companies (due to the much greater volume of work done) typically get lower labour rates and better prices than an individual would. Same deal for tyres.

At the end of a lease you will be exposed to off lease charges, meaning the quality of the vehicle you are returning, if its not in a reasonable condition for its age and km's you will be required to pay the difference.

Another option, if money is tighter, is to not lease a new vehicle, but a used vehicle (typically vehicles which have already finished a 36month or 45month contract), still get the benefit of leasing, but lower FBT.

There are a few other things as well, if you are serious about it, better to give a few lease companies a call and talk to them about it.

[S T E A L T H]

if you do lease, you should clearly think about the exact terms that you will be doing as you don't want to be paying excess km charges (which is typically quite high as it covers the vehicle's depreciation and maintenance, along as pinging you as well). Think about whether you have the cashflow to continue with the payments over the lease as you don't want to be early terminating the contract as it may be quite a hefty amount.

This is a good point as well, and correct me if I'm wrong but I'm pretty certain ALL lease companies have a lower excess km rate for non-maintained leases.
Last couple of cars I've got thru Fleet Partners the difference was double ! 7cents/km vs 14cents/km.

[AsD]

Well yes,

Fully maintained lease: excess km rate covers vehicle's depreciation plus maintenance
Non maintained lease: excess km rate covers vehicle's depreciation (leasor covers the maintenance portion)

So it would be about double for fully maintained vs non maintained

[BZG Wagon]

Remember at the end of the lease you need to square up extra kms, any damage to the car, dents, dings, scratches etc. Anything which may cause it's value to decline more than anticipated.

Think what the depreciation is in year 1 & 2. The lease company will want to recover that, plus make money from their 'investment' which they've leased to you. A nice, new car can cost upwards of $20k per year to lease.

One of the main reasons companies lease is to free up capital (i.e. money) for other uses (like buying stock etc), given the expectation they can make more money from that activity than having it tied up in a car.

[20mm spanner]

The issue with an Operating Lease is (as mentioned) the damage to the vehicle upon returning the car to the lease company. Currently the Lease companies are using low residual's (due to being over optimistic with the residual value of vehicles in the last few years- hence credit crunch). Also to consider, it is very difficult to get out of an operating lease, if your circumstance's change and you need to get out of the vehicle. These are some of the negative impacts of an operating lease.

A Finance Lease on the other hand, gives you greater flexibility through the term, and you can sell the vehicle at any time, but it is generally better to do this close to the end of the term. We can work out a residual figure based on how far you will travel, and an estimate of what it will be worth in 3 years time, it would be better to be more conservative with the residual.

pm me with what you are after, and i can get some pricing for you, i'm a vehicle broker, and this is part of what we do, aswel as discounted pricing on new vehicles.