New Truck Buy or Lease?

[garyp4951]

I'm still looking at new trucks (first time in 17yrs), and wondered if leasing would be a good option or not. I went and drove the Ram, and next will try the Ford, and Chevy. I do kind of favor the Cummins diesel, but will check out the Ford 6.2 gas model.

[JALLEN4]

Walaby wrote:

guidry wrote:
There is a reason salesmen push leasing over buying; ever wonder why!?

Actually my experience is just the opposite. In my 40 years of adulthood, buying multiple cars I have never had a salesman mention leasing. Im confident the salesman makes more on purchases, as does the dealership.

Mike

I can assure you that the salesman and the dealership make every bit as much money on a lease as a sale. In most cases the gross average on a lease will be higher than a purchase. Many salesman do not bring up leases because they are not properly trained on them or their area is not a very lease active area. Leasing is growing rapidly in the past few years and is up to more than 30% of the sales.

The popularity of leasing is very simple. The monthly payment is 30% less than a purchase payment on average. New vehicle loans are now up to an average of 66 months to make the payments affordable for the majority. Most people are never going to pay off the vehicle before trading and will need to make somewhere around 50 payments before they are even in value to balance. People can disparage leasing all they want but, until vehicles start getting cheaper or people start making a lot more money, leasing is a fact of life.

[mich800]

time2roll wrote:

2001400ex wrote:
One advantage to leasing is you can deduct it on your tax return if you own a business. I lease my wife's vehicle for that reason.

Either way the business use is deductible. Total deduction comes out about the same. If the lease gives a bigger deduction it is because the lease was more expensive.

This misinformation comes up all the time. I don't know where this started that a business expense or asset is only tax deductible if it is leased.

[time2roll]

2001400ex wrote:
One advantage to leasing is you can deduct it on your tax return if you own a business. I lease my wife's vehicle for that reason.

Either way the business use is deductible. Total deduction comes out about the same. If the lease gives a bigger deduction it is because the lease was more expensive.

[garyp4951]

Since I am retired, and due to the cost of repairing late model diesels, I would not keep one after the warranty expires, and thus the reason for leasing.
If I get a gas burner it will probably be my last new truck purchase, but for now I'll keep my 03 for a while longer, and save up some cash.
Thanks for the great info

[Ron3rd]

garyp4951 wrote:
I'm still looking at new trucks (first time in 17yrs), and wondered if leasing would be a good option or not. I went and drove the Ram, and next will try the Ford, and Chevy. I do kind of favor the Cummins diesel, but will check out the Ford 6.2 gas model.

Regardless of what some will tell you, Buy vs Lease is a simple mathematical equation. Leasing makes sense in some cases based on how long you keep the truck, miles driven, etc.

Do you want to own the vehicle eventually? Do you want to be always driving the latest and greatest? Do you want a truck that is always in warranty? All questions to ask yourself.

I keep all me vehicles for 10 yrs or more so buying is a better option for me.

[2001400ex]

IT_Burnout wrote:
When I had agreed to purchase after all the haggling on my trade. I was looking at all the numbers I told the fiance guy I wanted to take over night and discuss all the purchase options with my wife. I figured we could think out our purchase options clearer and see what fit us the best with out an audience. During one of my conversations with the owner of the dealership on leasing he told me the leasing companies amortize the diesels trucks at the same rate as gas vehicles. They just lump them all together. But diesels don't deprecate at the same rate as gas trucks they retain value longer. He said typically you can purchase at the end of lease and capture some equity that just goes back in the leasing company confers if you turn it in. He said we (the dealership) used to buy out all the diesel leases that we could ourselves when people turned them in and then resell them to grab that equity. The leasing companies got wise to us and put a stop to it, they wanted those $$$$. He said typical that equity is $5K to $10K at the end of the lease on a diesel if the vehicle is well cared for. I asked if I could just purchase on paper and trade right back in and lease another and capture that equity. He said you sure can I got a lot of people that do just that. I am not sure I buy all of that, but something to consider at the end I guess.

We did that on our first lease. Was a 2006 Impala SS. We bought the lease out at the end of the year for 12,500. We drove it another 18 months and sold it for 13,000. Our current 2015 Highlander we leased as well, the buyout is 27,500 next summer. It'll be worth over 30k. I'll probably buy it out then sell it and lease another. Ask I said before, I want a lease to write it off for our business.

[IT_Burnout]

When I had agreed to purchase after all the haggling on my trade. I was looking at all the numbers I told the fiance guy I wanted to take over night and discuss all the purchase options with my wife. I figured we could think out our purchase options clearer and see what fit us the best with out an audience. During one of my conversations with the owner of the dealership on leasing he told me the leasing companies amortize the diesels trucks at the same rate as gas vehicles. They just lump them all together. But diesels don't deprecate at the same rate as gas trucks they retain value longer. He said typically you can purchase at the end of lease and capture some equity that just goes back in the leasing company confers if you turn it in. He said we (the dealership) used to buy out all the diesel leases that we could ourselves when people turned them in and then resell them to grab that equity. The leasing companies got wise to us and put a stop to it, they wanted those $$$$. He said typical that equity is $5K to $10K at the end of the lease on a diesel if the vehicle is well cared for. I asked if I could just purchase on paper and trade right back in and lease another and capture that equity. He said you sure can I got a lot of people that do just that. I am not sure I buy all of that, but something to consider at the end I guess.

[TomG2]

You mean there is not one answer for everyone all the time in every situation? How interesting.

[IT_Burnout]

IMHO it really depends on your needs and situation on if leasing makes any sense for you. I just bought a new 2017 Chevy LTZ Duramax and it was my first time ever leasing. I bought a Chevy because I have a family member retired from GM and I got an employee discount. In the past leasing didn't make any sense for me. This time I feel it did. No one pushed leasing on me at all, but it was offered as a possible solution since I expressed interest. The dealers attitude was hey you going to buy a truck from us we don't care how you pay for it. I am retired and I am only using my truck in the summers to tow our 5th wheel. It sits all winter in a garage while DW and I go Florida to our condo in our other SUV. I am at a stage in my life where I want to buy a new truck every 3 years. It's either that or leave more $$$$ to my kids when I take the big dirt nap. I also pay cash for my vehicles at this point, I hate making payments. If I have to make payments I won't buy it. I could have put out $70,000 for this new loaded Chevy. Or I could have put out $30,000 to lease it. I paid the whole 3 year lease upfront, so I don't have any payment and I got a slight discount for doing that. I made approx 15% on my investments so far this year. You can do the math, by having that other $40,000 invested I make an additional $6000 this year. If I say this year is typical after 10-12 year I have saved the cost of one new truck. That assumes my investment always perform as they did this year, who knows how that will all work out in the end. Yes I can tow my 5th wheel with the new truck with no issues. I can't drill any holes in the box to mount a rail kit or anything like that. Which I don't plan on doing anyway. I got the truck with a Chevy bed cover and the factory 5th wheel prep package so the dealer just dropped in a new hitch and I was good to go. I did pay for extra miles upfront in the lease so I know I won't run out of miles. If I do run way over on miles or really like this truck I can buy the truck for approx $40,000. So if I change my mind on this approx I will just buy it outright. Did it cost something extra to lease, yes I am sure it did. But I am also sure it didn't cost $6000 each year. It really comes down to your situation and how much you drive and how long you plan on keeping your truck if leasing makes sense for you.
Bob

[Walaby]

guidry wrote:
There is a reason salesmen push leasing over buying; ever wonder why!?

Actually my experience is just the opposite. In my 40 years of adulthood, buying multiple cars I have never had a salesman mention leasing. Im confident the salesman makes more on purchases, as does the dealership.

Mike

[JALLEN4]

The major problem with leasing is that most people don't understand it. There are many many myths and misquoted facts about leasing, many of which have already been quoted in this thread. An accountant has already told you that the product makes sense. I am a retired dealer and did a one-pay lease on my personal vehicles for my entire career. It was simply the cheapest way to have the vehicles. But then again, you can be one of those who say leasing is the worst thing ever...without a clue as to how they really work.

[TomG2]

guidry wrote:
There is a reason salesmen push leasing over buying; ever wonder why!?

Purchased nine new pickups in the last fourteen years from several dealers, and not one salesmen even mentioned leasing. The finance man did last month, but only after I brought it up.

[guidry]

There is a reason salesmen push leasing over buying; ever wonder why!?

[TomG2]

At the closing on my latest truck, I trade often, the finance guy said that a lease would work well for me. The deal was already done or I would have checked into it. I am not one who follows the herd. It is all about trouble free miles, good times, and lastly cost. For me. When someone says, "Let's go", I am ready to go. I don't want to have to decide if the old pickup need a new starter, tires, brakes, or power steering unit before I can leave.

[thomas201]

When I turned 16, my Dad said I could borrow his truck, but I could not bash it up in the woods. I bought a 1948 CJ2 that we both bashed around the woods (got the money working at the local race track and sold a Honda trail 70). We each brought a vehicle to the mix, that was 1973, the Jeep is still with me, Dad sadly is not. So yep! I got the first vehicle I ever owned. My son wants it, guess it will outlive me.