Tell me about car leases

I’m thinking about leasing a car. The setup:

My car is turning ten years old next month, which is like 800 in dog years or something. It runs fine but a little rough as you may expect from a car of this age (115K miles), it doesn’t have hi-fi gear like a line-in for my iPod (I use one of those FM transmitter deals), and it has a couple mechanical issues (the worst is the A/C is out, everything else is extremely minor). It gets about 30mpg on the highway and has a manual transmission. I own it free and clear and am thinking of fixing the minor issues and selling it.

Starting in September, I’ll be putting about 300 miles a week on the car as I’m living in Sacramento but attending school on Saturdays in San Fran. Each Saturday will involve approx 4 hours of driving, round trip, which means I’d like a certain level of comfort, smooth riding, mp3-ability for audio books, etc. I’d also like to not have a manual transmission while I’m spending so much time in San Fran, City Of. I don’t mind the shifting during the occasional trip like I make now, but not with every week (the school I’m attending is nowhere near Bart, Cal-Train, or the freeways, so many surface streets are involved).

Also, I heard on the radio yesterday that California car dealers are running smoking hot deals on leases in terms of monthly payments, like $150/mo for three years type deals. Doing some basic math, this would mean $5400 (plus tax, etc) to operate a new car with no concern for mechanical breakdowns, smooth rides, and hi-tech gear to simplify my days for three years. Drive it like it’s stolen then give it back, right?

I understand going in to the lease that I want to be careful about yearly mileage limits, and I am fully aware I will not own any equity whatsoever in the car at any point. What else should I know about leasing? Is this a truly shitty idea for any reason? Any anecdotes about leasing in the current economy (I have great credit)? Is it a good idea to take over someone else’s lease through one of those swap sites rather than start up my own?

There are good lease deals to be had, but all of them likely have very low mileage limits, to the tune of 10,000 miles/year with heavy fees for going over. 300 miles/week is no joke, so you’d end up having to pay more for the lease to get up to a 15k/year limit (they’ll let you pre-negotiate that rather than paying overage).

I’ve leased several cars and it’s just fine. There are websites that will tell you what to look out for. Not every lease deal with a nice-sounding monthly cost is a good deal - you’ll need to negotiate the purchase price and residual value (the price the dealer gives the car at the end of the lease term) and there is an effective interest rate as well.

CW on leases is that the dealership makes you pay off the car (their cost) in two years, and then you get to buy it again. However, with that much driving and the current environment, this is the first time I would suggest that a lease is probably a good idea. Just make sure you’re getting it for 60% of what it would have cost before the crash.


Yep. It’s pretty much only good for people who wear out a car with driving and would lose all equity on it anyway. Otherwise, it’s pretty much always better to buy last year’s model (or a 2 or 3 year old used car). I think you would do well to lease under these circumstances.

I would identify some of the smoking-hot deals to make sure they truly exist before making any plans (so you’re saying these lease deals involve ZERO cash down up front? That sounds crazy). If it were me, I would keep driving the current car and start socking money away for a future purchase/lease when it became necessary (for reference, our two cars have 240K and 126K miles on them and I am praying we get 2 more years out of each).

Leasing a car will only lead to you wasting lots of money because they will fuck you over so bad you’ll walk funny.

And you won’t even know it.

My car is 16 years old and has 200k miles on it and has an iPod-in jack (cost like $65 and was easy to self-install).

Hooray 1993 Toyota Camry!

Sooner or later I’m going to have to buy a new (or at least “new to me”) car, but it is really nice not having any car payments.

Though you do have to keep a bit set aside with the older cars, for when they decide to flake out and die. Usually it’s something repairable, but it’s annoying if you get caught unprepared.

Why don’t you take the train from Sacramento to SF instead of driving? IIRC there is one on weekends, although perhaps it doesn’t fit your schedule.

I’m on my second lease and I love it. Hassle free driving, no taking it in the ass from crooked mechanics and a new car every three years. I’m never gonna buy a damn car again. One extremely important note is to know your annual milege. I put about 13K a year on the car, so I got a lease that allows for 15K a year.

If you are really putting 300 miles a week for just your commute that really is a bit too much for a lease. You basically have to buy all the miles that you think you will use and there is a point where it is more cost effective to buy the car, I suspect that for you this is the case.

There is no way you should go with one of theose cheap leases since they are more than likely 8k a year for milege, and you use double that for just your commute. That being said you can certainly get a decent lease with no money down, but for the milege you need I’d expect to pay sometyhing in the $300 dollar a month range for a midsize sedan.

Keep in mind that if you do BUY a new car, the taxes this year are deductible on next year’s taxes.

I just got a lease on a Honda Accord for approximately $7,000 including all fees for 2 years. 12k miles per year, they have no other option. There weren’t any cars I really wanted to buy right now, and I figured maybe in two years there will be some more electrics to choose from.

Has anyone ever used a lease trading service like or where you can basically take over an existing lease from someone else? It seems a good way to avoid the worst of the reaming associated with a lease (someone else paid the up-front fees already, etc) but still getting a dealer-maintained car with defined payments over a defined period. The only disadvantage I can see is less choices of cars since you’re only able to pick among those who are trying to get out of a lease.

I’m thinking of having my Mom lease instead of buy. She puts almost no mileage on a car and wants as low a payment as possible. We have been quoted $2200 down(incl. first month) and $199+ tax a month for a 2009 Corolla LE( Sticker $17,500), no security, 36 months.

Good deal, bad deal? I assume this also would be negotiable as a sale would?

Bad deal…payment isn’t bad, but that’s too much down. Push them much, much harder.

What is the annual milege?


Not a problem. Her current car is a '96 with 28K mileage on it. :)

It’s failing anyway, but not from mileage!!!

If she’s comfortable driving a car for 12-13 years, maybe she should consider buying instead of leasing?

Yes, this. Buy a used car that’s just a couple of years old (or low mileage for up to 4 or 5 years).

Leasing is never a good idea, unless as others have said, you plan to get rid of it after a couple of years. And then, it’s really the lesser of two evils. Instead of hemmoraging money by replacing cars too fast, you are hemmoraging slightly less money by leasing.

If you are looking to cut costs, do it by buying someone else’s costly mistake: a slightly used car that was probably leased or owned for much too short a time. With dealers desperate to sell, you can probably get a damn good warranty too.

Case in point:

Why on earth would she pay $9,600* for a $15,000 car** for three years when she could own the car for a lifetime (well, 15-20 years Corolla lifetime at least) for less than than twice the price instead?

This is why leasing makes no sense.

*Assuming only a 6% tax.
**That’s my rough guess based on the percentage over what any dealer will sell for without special rebates. That link will make car buying much less of a headache, new or used.

If she lives in Gainsville, look into a car share program instead as she drives only occasionally. Save tens of thousands.