Tom House

Big Bend
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Big Bend
I'm planning to lease mine for two years. Will be covered by the warranty. Let Ford get everything sorted with colors, tops, etc If like it can buy it. Or can turn it in and get another exactly the way I want it. Or move on. I'll go Big Bend and the 2.3 , prefer the 2.7 but don't want the delay. Mid package. Should give me a god idea if I like it. Be interesting to see if A PLAN gets the price down ?!

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Hadn't considered leasing. Have never leased before. Can you always buy at end of lease? And, dumb question, but the amount you've paid in monthly payments is taken into account for purchase price, yes? If so, this makes a ton of sense for a vehicle that won't sell below MSRP for years.


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Laminar

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Hadn't considered leasing. Have never leased before. Can you always buy at end of lease? And, dumb question, but the amount you've paid in monthly payments is taken into account for purchase price, yes? If so, this makes a ton of sense for a vehicle that won't sell below MSRP for years.
The "Residual Value" is what the automaker predicts the vehicle will be worth by the time the lease period has ended. If you want to buy your vehicle at the end of the lease period, you pay the Residual Value (plus a vehicle purchase fee if your dealership charges one).

Leasing is advantageous in a couple scenarios:
1. You know better than the automaker what the residual value of the vehicle will be after the lease term is up. If you feel that Ford is undervaluing the residual value, you could buy out the lease on your three year old Bronco for less than what a used three year old Bronco is selling for. But if the car market tanks for whatever reason (or if Ford overvalued the Residual Value) and used Broncos are selling for way less than your residual value amount at the end of your lease, you'd be wasting money if you bought it out.

2. Lease incentives. The dealer or automaker has specific lease rates in an attempt to move vehicles. They could have some crazy no-money-down $199-per-month deal in an effort to move cars. This won't be the case in a hot market on a high-demand vehicle like the Bronco.

Leasing is disadvantageous in a couple scenarios:
1. You might actually use the vehicle. Leasing agreements limit you to a strict yearly mileage allowance and penalize you if you go over it. Maybe you get a new job with a longer commute and you end up piling on more miles than you expected.

2. Modifications. You can't do anything to the vehicle, because it's not your vehicle. Even things like suspension or tint can get you in trouble.

3. Tires. When you turn it in, they have to be above a certain tread level and within manufacturer specs. You could be penalized or have to buy a new set of tires if you went out and put 35s on your non-Sasquatch, or they could be picky and get mad that you put all-terrains on a vehicle that came with highway tires.
 

Tom House

Big Bend
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The "Residual Value" is what the automaker predicts the vehicle will be worth by the time the lease period has ended. If you want to buy your vehicle at the end of the lease period, you pay the Residual Value (plus a vehicle purchase fee if your dealership charges one).

Leasing is advantageous in a couple scenarios:
1. You know better than the automaker what the residual value of the vehicle will be after the lease term is up. If you feel that Ford is undervaluing the residual value, you could buy out the lease on your three year old Bronco for less than what a used three year old Bronco is selling for. But if the car market tanks for whatever reason (or if Ford overvalued the Residual Value) and used Broncos are selling for way less than your residual value amount at the end of your lease, you'd be wasting money if you bought it out.

2. Lease incentives. The dealer or automaker has specific lease rates in an attempt to move vehicles. They could have some crazy no-money-down $199-per-month deal in an effort to move cars. This won't be the case in a hot market on a high-demand vehicle like the Bronco.

Leasing is disadvantageous in a couple scenarios:
1. You might actually use the vehicle. Leasing agreements limit you to a strict yearly mileage allowance and penalize you if you go over it. Maybe you get a new job with a longer commute and you end up piling on more miles than you expected.

2. Modifications. You can't do anything to the vehicle, because it's not your vehicle. Even things like suspension or tint can get you in trouble.

3. Tires. When you turn it in, they have to be above a certain tread level and within manufacturer specs. You could be penalized or have to buy a new set of tires if you went out and put 35s on your non-Sasquatch, or they could be picky and get mad that you put all-terrains on a vehicle that came with highway tires.
Ah, so you pay the residual value, regardless of what you've already paid in lease payments? My god, then why would anybody ever lease?
 

mjcutri

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Ah, so you pay the residual value, regardless of what you've already paid in lease payments? My god, then why would anybody ever lease?
The residual value affects what your lease payments will be. The calculation is something like Monthly payment * term (months) = (sales price - residual price) * interest rate

I've only ever leased 1 vehicle because I usually pay cash (unless they are offering 0% APR, nothing like "free" money)
My wife and I leased a Nissan Rogue for her the first year they came out and Nissan undervalued the residual because they didn't have much to go on for future resale values, so our monthly payment was higher but at the end of the lease we could have bought it for like $5k less than they were selling for used. Unfortunately she was between jobs at the end of the term, so she just turned it back in because she didn't want the financial obligation at the time.
 

Hornet

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Ah, so you pay the residual value, regardless of what you've already paid in lease payments? My god, then why would anybody ever lease?
You can see the total lease payments and add it to the end of lease purchase price in your lease agreement to compare to what it would be vs a purchase. Sometimes it's about the same so I like the ability to walk away. I and if you buy it's like you can buy over 5 years and get lower payments than if you purchased orginially.
I once leased a Honda minivan for the wife. At the end of the lease the payoff was $18k. Yet they had several on the used lot for sale at $24k. It was good deal to keep it vs buying new at $30K.
A good point was made about the mileage. You have to pay if you go over what you agreed to in lease so good idea to get enough miles in your agreement.
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