car lease vs car loan vs outright purchase
Question: So, I can do the above or buy the car for cash at $15,000 less $1000 >>for my tradein. Buying it now would be done with my existing home >>equity line of credit (no fees) and thus give me a tax writeoff on >>the interest.
I would buy it outright. I’ve never found a lease where you’re not getting screwed.
Answer: Not true. There are many great lease programs out there, and many really bad ones as well. It all depends on the “Money Factor/Interest Rate” and what the “Residual/Buyout” value on the car is. For a lease, such as VW’s recent Jetta program written through VCI or some of Bank One’s programs, you can lease a car and purchase at the end of the program and have a total amount invested equal to or less than a conventional finance program. Added bonuses are that you know what your car will be worth in 3-5 years, and you’ve gotten to use and enjoy your money in the mean- time, you’ve had a lower monthly payment, and can delay a full purchase decision for quite a while. You must not have had leasing explained to you very well… Either that or you haven’t listened! I sell new cars, and I am familiar with these type of programs and why people lease instead of buy. Its a great way to bury inequity, you have none of your own money invested so if something drastic happened you could walk away, and the tax incentives for businesses are fantastic.
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Filed under: Home Equity Loan
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