Confused by some of the hate on the lease option. Seems wise for those wanting Low Down and Lower Monthly Payments

[elnorte]

Is there a significance of residuals if you're planning on buying out the vehicle? Arent those more important if you're getting rid of it and that is where you could get hit hard?

I have full intention of buying the car at lease end unless something significant is wrong or substantially changes. Hence why I am seeing lease as saving grace from large downpayment initially.

If you plan on buying it at the end of the lease. Just buy it from the beginning. If not it will be like "buying" a tv from rent-to-own and paying way more than you need to. Why lease for 48 months then get a 48-60 month car loan?

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[Cappy]

I’ve leased and bought and sometimes leasing is good. 1 mile over isn’t giving you a ballon payment. It gives you an excess mileage charge of $0.20/mile or whatever. Ford Credit has very specific rules around damage, etc. If you don’t get another Ford at the end of the lease there is a fee. This has always been disclosed to me. I’ve never had a lease turn in issue.

Most Ford leases do not have a “balloon” built in. They all have a buyout price at the end of the lease. Purchase is not required. The Mach E has a balloon option but that’s a different thing altogether.

I wouldn’t recommend putting money down on a lease though. You aren’t paying a lease down to get equity in the vehicle. You are paying for the use and the depreciation. Keep your money in your pocket and have the higher payment. If you total your Bronco on day 1 of ownership, that $5000 cap cost reduction is gone.

Ah, I pulled up the wrong lease agreement by mistake, I'm tired. I was referencing this clause:

≄17 Lessee agrees to an initial payment of $1,298.oo for the first mile of overage and $o.19 for each addition mile...

 

[atonge40]

Is there a significance of residuals if you're planning on buying out the vehicle? Arent those more important if you're getting rid of it and that is where you could get hit hard?

I have full intention of buying the car at lease end unless something significant is wrong or substantially changes. Hence why I am seeing lease as saving grace from large downpayment initially.

Yes. Lease a vehicle that you think will be worth more than the buyout price. That will make the lease buyout financing easier and put you in a better spot. I sold 4 VW vehicles that I leased. I made $1500-$4000 on each. Market value was higher than my buy price.

 

[atonge40]

If you plan on buying it out right do it from the beginning. If not.it will be like "buying" a tv from rent-to-own and paying way more than you need to. Why lease for 48 months then get a 48-60 month car loan?

It only makes sense if the lease has more cash on the hood or there are other factors involved. My Ranger would have been a good candidate since it’ll be worth more than the buy out price and leasing gave me an additional $3500 off the price. But you have to be smart about it. I don’t recommend it for everyone. I did the math and I’d save over $2000 buy leasing and then buying out my truck over buying it from the start. I am aware that this is not the norm.

 

[11Bronco1776]

I think you really need to run the solid math and get hard numbers to compare both scenarios.
I'd have trouble walking away with no car(equity) after paying them $33000.
You're also looking at financing for 8 or 9 years now? ...if you don't have the money saved to buy it outright by then.

I put on WAY too many miles to consider leasing ....

So if I financed now I was planning on the 72 month term. So if I leased for 48 months really have 3 more years until even. But I would probably buy outright then or within a year

 

[elnorte]

It only makes sense if the lease has more cash on the hood or there are other factors involved. My Ranger would have been a hood candidate since it’ll be worth more than the buy out price and leasing gave me an additional $3500 off the price. But you have to be smart about it. I don’t recommend it for everyone. I did the math and I’d save over $2000 buy leasing and then buying out my truck over buying it from the start. I am aware that this is not the norm.

I will admit I am not familiar with "hood candidates", but I think I get the jist. I guess if the dealer is giving incentives to lease (get a vehicle off the lot as fast as possible) I understand but I am not sure how many, if any, dealerships are offering incentives or hood type things(?) For broncos.

 

[atonge40]

I will admit I am not familiar with "hood candidates", but I think I get the jist. I guess if the dealer is giving incentives to lease (get a vehicle off the lot as fast as possible) I understand but I am not sure how many, if any, dealerships are offering incentives or hood type things(?)

Lol autocorrect. Good candidate.

 

[elnorte]

So if I financed now I was planning on the 72 month term. So if I leased for 48 months really have 3 more years until even. But I would probably buy outright then or within a year

Just be sure to read the 5-12 pages of fine print and may be have it reviewed by a legal professional to cover yourself and understand what all of the extra added costs are to buy at the end of the lease. In the end it is what makes you happy and fits your current financial situation.

 

[bbqbronco]

Hood candidates ftw. Only reason I buy things outright is cuz I'm too dumb to figure out the other options. ?

 

[atonge40]

I will admit I am not familiar with "hood candidates", but I think I get the jist. I guess if the dealer is giving incentives to lease (get a vehicle off the lot as fast as possible) I understand but I am not sure how many, if any, dealerships are offering incentives or hood type things(?) For broncos.

You are correct that buying will be the best option on most Broncos. Ford is not putting any incentives on these vehicles. That’s how leasing becomes a good deal.

 

[BravoV4]

Appreciate the info. Gives me more to look into involving the interest rates and how they effect things. As far as going over on miles or an hour late on turn in not worried, I am an adult.

As a safety net though my understanding is that if you go over on miles or there are wear and tear issues but are buying the vehicle out at lease end then there are no penalties. You just buy it at the predetermined price you agreed on at the initial contract. Thus making mileage and wear and tear penalties a mute point in that scenario, correct?

The only thing in that scenario I tell customers to worry about is if you're too high on the miles. Every bank has a book value for a car. Be it KBB or NADA if the miles are high and it brings the value down you may need to put money down. But sometimes you can get away with it if your credit is absolutely excellent.

 

[Russ1Bronco]

By doing the lease deal,you get more for your money up front...a base lease starts off at like 291 a month..(48 mo.).adding the hard top sound deadening adds 4.00 to 295. adding the front bumper,an 825.00 dollar option adds only 8 dollars to the payment...303. .adding the A10...bumps up the monthly payment to 317...and 1 more..adding the 2.7 to the payment is only 18.00 a month...total monthly payment is .335.00 a month...a great deal if you only keep it for 48 months...

 

[BravoV4]

Yes, but they aren’t putting cash on the hood. They hook you with returning leasee, conquest, matching down payment, package discounts, stock discounts, and other incentives on other vehicles. An F150 XLT would lease about the same as a Bronco Base. The Bronco Sport is actually higher though.

We don't what the apr is gonna be yet so we can't say anything with absolute certainty. Right now at 36 months for the Bronco sport it is 2.95 if the dealer tells you that. On the 2021 Ranger it's 4.15. Until these hit the lots we won't know for sure.

 

[11Bronco1776]

Yeah I’m not sure where that payments coming from either. I leased my challenger for whatever god awful reason for 6 months before refinancing and I paid like $628 a month for 48 months with 4K down and it was 50K. No way you’re getting a $575 payment, more like $700.

Also, I’ve never seen a lease outside of those killer deals they run for promotions that wasn’t designed to make you pay 5K+ more than the out the door price. Leases are not designed to be financially smart, if they were everyone would do that and never buy.

 

[11Bronco1776]

I’m not an expert, but i think the big error is not accounting for the interest. I know you said you are keeping it simple, but the interest you actually pay in a lease if you back calculate it is typically huge.

Appreciate that something to look into on myend for sure

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