Buying vs. Leasing (cont.)
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There are benefits
in negotiating a lease. Discovering dealer holdback and incentives will
arm you with powerful ammunition for haggling a more favorable price for
either method. The advertised lease is dependent on a down payment (aka
cap cost reduction)
to deliver the juicy monthly price (note: $399 doesn't include tax), but
that contradicts a real appeal of leasing: getting into a new vehicle
for little out of pocket. The contract can be rewritten to remove that
from the drive-away cost, which will already include the security
deposit, disposition fee, and first payment.
Keep in mind, too,
that mileage can be a real problem for leasees, since the dealer will
exact costly penalties for exceeding the maximum allotment. Prepaying
for additional miles at a lower rate can save serious money, and the
surplus can be refunded.
The traditional
buyer has few tricks other than to maximize the down payment and
negotiate aggressively. Term length can be adjusted to achieve a
favorable monthly payment, but the overall cost increases with every
additional month. A $725.14 payment reflects a three-year loan (to match
the lease), but while extending the term to 48 months lowers the monthly
payment to a more reasonable $564.67, it adds about $1000 to the total
cost of acquisition. Buying the vehicle ultimately means $30,105.04 out
of pocket, but there would still be $19,230 worth of truck in the
driveway after three years.
Stellar lease deals
can be found, usually with manufacturer
subvention,
but buying will likely be more cost effective in the long run. Again,
with some significant incentives being offered from automakers, examine
each scenario carefully. If inclined to pursue a lease,
click here
to review a Leasing Glossary so you’re armed with the lingo to negotiate
the best deal. |
