fanatic6711

Someone please shoot me down if this doesn't look right, but if I'm correct, I found a way for recent college grads like me to own this beautiful machine. I was fooling around with the lease estimator and of course you must want to buy the car for this to work, but if you put down $8,000 for the Enthusiast, for a 1 year lease term, with 15,000 miles, your payment comes out to be 183.27! Of course if you can afford the car now, go and buy it. But for someone like me, who needs to limit his costs, this works great. You would just have to get the lease extended every year and I know dealerships would do that. Not sure how many times you could extend the lease though. I'm sure there is only a few times that they would extend the lease, but by that time, you'll be older and have more disposable income. Is this right or no? I need some feedback on this.

LordBiO

Why would you put down $8000 on a lease? On a one year lease that works out over $650 a month + 183.97 lease payment = $833.97 a month. That is how much you would be paying for the car for one year. Why not just get a 60 month loan on the car.

It would end up working out in your favor in the long run if you plan on keeping the car for years to come.

fanatic6711

Because, I plan to buy the car, but can not afford to pay to finance it. I will have enough money for a good down payment and want to keep my monthly car payments low.

Leon's Z

I agree with LordBio. You are throwing your cash out the window. With $8K to work with, that is a decent down. Finance it. Either way (leasing or buying) you will still have financing hurdles to overcome. Why not do it in such a way as to have something to show for it in the end - THE CAR!

fanatic6711

Do you people not see my point? I'm going to lease with the option to buy. Sure I'll pay some more money in the end, but by that time I'll be older and also be making a lot more money. The leasing can keep my payments down per month. Look at it this way. I could spend $450 a month to finance it, plus gas, maintance and insurance and live at home the rest of my life or spend $249 a month save $200 bucks for other things, like a house or engagement ring, etc. and backload the rest to the risudual, where when I'm 28 I'll be able pay it off with less expenses because I'll be making more money. This makes the Z affordable now. Make sense?

Monkey Man

You need to sit down and calculate the total amount you are paying out under both situations, then you will understand why everyone is telling you to buy. Yes, your monthly payment will be much lower, but your option to purchase will probably be like 25,000 or more after making payments for a full year, and paying 8,000 down. What will you do then? If you plan to only drive the car for one year, and then take your loss and move on, you have a good plan. However, after driving your Z for a year, I promise you WILL NOT want to lose it. And you will then be faced with the dilemma of how to finance the purchase option. Just do the math, and you will see that the loan is your only feasible option unless you plan to turn the car back in. Just think about it for a while and you will see, there is a reason that no one does what you are talking about doing. It makes no sense. Good Luck.

***Edit: After re-reading your post, I think the fault in your logic is that you are calulating your lease based on a 12 month lease. This means, you have to buy the car after your lease is up, or continue with the lease at a higher rate. Go back to the estimator and use 48 months as your period, that will give you a better indication. Unless of course you want to purchase the vehicle next year. ***

z texas

But if you've got $8k you could use that to make payments the first year, and still have the money you were going to make your lease payment left over on top of whatever else you planned to have extra every month. Eventually you'll need to pay more than $190 a month if you plan to buy it. That is unless you plan to finance it for the rest of your life.

Leon's Z

MonkeyMan probably took a little more time to explain where some of the thinking came from that recommended the buy route. He is correct all around. Fanatic, you are the one who will live with the decisions, and we are only offering some opinions after having been there and done that. One of your assumptions about being able to get a one year lease is problematic. I don't know if that is do-able. If you can get it - great. However, you will have to consider the ENTIRE COST OF THE LEASE, and the residual value of the car, all in conjunction with a very important factor... YOU WILL FALL IN LOVE WITH THE CAR, as MonkeyMan put it.

This is my first Z, and I KNOW that I am hooked. I KNOW that this will not be a simple "one night stand". I KNOW that me and my "Z" will be partners in sin. Maybe I'm going on too much, but here's the point. If you think that the same sort of passion for the car will be there for you, just do it right the first time and don't create a hardship for yourself. If one year will make that much of a difference, buy the 2004 model (or get a great deal from a guy like me who might be willing to sell mine to upgrade).

You're young, you got time, and where does one keep a car in New York City anyway without a lot of expense?

Bottom line: If it works for you go for it. Life without a "Z" has to be different than life with one - you just gotta figure out when and how.

Good luck.

tbcz

I think a fault in your logic (if I am understanding you correctly) is that when and if you were to continue the lease after one year that the payments would remain at what they were. Don't forget...those payments are only for one years depreciation on the car, and that amount includes the $8000 you are putting down. At the end of one year, you are 0% vested in the vehicle.

So now what do you do? Figure out the retail cosat of a one year old 350Z with 15,000 miles on it...let's ballpark and say $24,000. You are starting all over again with a car that costs $24,000 rather than $28,000. So, you could continue with payments of $183...that is if you put down something like $6000-$7000 this time. Don't think of the $8000 you give them up front as a "down payment"...it's a capitalized cost reduction, which just means you're paying for some of the one year leases's depreciation up front. At the end of the year...you still have nothing...except you're over $10,000 poorer for driving the car for one year.

Of course, I'm no financial expert, so please feel free to point out the flaws in my logic if my head is up my ***...

z350z

Leasing or a balloon-type loan (where the residual value is still owing at the end of the term) is a reasonable way to get into a vehicle that you couldn't afford with a normal loan, but putting a lot of money down doesn't make sense. And I've never heard of a one-year lease: the one you describe seems like a lot of money down the drain for one year of ownership. Try looking into a more conventional lease with less money down (and invest the money you have and use it to live off or help with payments as you go), or a balloon loan with a good interest rate. It will still cost you more in the long run that an ordinary car loan, but as you point out, it may make the difference between being able to drive the car or not.

Good luck getting your dream car, but don't do anything stupid!

SMBRUNING

A couple things to think about:
A vehicle doesn't depreciate over 2-3 years at the same rate.
Typically, the most depreciation is over the first year (as a % of the total vehicle value) and then less the second year, and so on.
Leasing a car for one year (at it's greatest depreciation) is not in your best interest financially. That's why most leases are at least 2 years and typically better at 3 years. (your payments are equal each month for 3 years-but the cars depreciations slow down over the same term.) Think of it as your cars declining value catching up to what the leasing company says it is worth (residual) in three years.
Also, if you lease a car for 1 year, at the end of the year the leasing company (NMAC, WellsFargo,BofA,etc.) will want either the car or the complete payoff (residual,etc) at that time. Once the dealership assigns the lease, they have no way to extend the lease-it is out of their hands. All matters are between you and the company that leases you the car. Normally they want you to buy the car-(then even if you did release the car. typically at higher rates/lower future residuals-resulting in higher payments!)or refinancing the balance on payments anyway.
Consider this: NMAC has an excellent College Graduate Program that should qualify you for lease or purchase as a tier one customer (best terms). Either purchase the car straight away for 4-5 year financing or lease the car for 3+ years(with considerably less than $8000 up front.) Your are getting a great car to drive everyday, building your credit for your future (next car, house,etc)and the payments will still be affordable along the way. GOOD LUCK!

tbcz

Sound advice, SMBRUNING.

Chris S

If you can't afford a note, I'd advise you to be patient and wait until you can. I HATE leases w/ a passion, as they provide so many ways for the lessee to get screwed, and the all-in cost is almost always greater than buying.

EriksonFL

Take your 8g's and get a nice pre owned Z you’re looking at payments around 250 remember insurance 230 a month for a 20yr old. Look find a Z for 19,000 put your 8 down borrow 11,000 payments 250 a month for 60 months at even bad credit 13%

http://www.banksite.com/cgi-bin/bankloancalcdcar2.cgi

sprmario

All leases are a bad deal. Car dealers make more money on leases than they do on any sale. The reason is that the lease hides a lot of your costs in a pretty clever way.

lets say a new Z is $30,000 and in 3 years it will be worth $15,000. The lease will basically give you the start price of $30,000 and will make you pay down to $13,000 or so, covering $17,000 worth of de-valuation in those three years AND the effective interest rate is higher than market.

So they screw you on the purchase price, the residual value and the effective interest rate... HOWEVER, since you are only buying three years worth of vehicle, your payment is still lower and you think you are getting a good deal but you just got raped by the dealer and you are happy you got raped.

At the end of the three years you have nothing at all to show for it, they have a locked in profit because you paid down to $13,000, and it's worth $15,000. If you did anything remotely bad to the car they will charge you an arm and a leg to fix it and pocket more profit.

And I can go on... lets say you want out of your lease because you move somewhere that you don't really need a car like NY or DC or San Fran, or you lose your job and you can't even afford the lease and you want to get out of it.... YOU CAN'T. You have to pay all the remaingin lease payments to get out of the lease. At best you turn it in, they auction it (and they could care less what they get), and then you have to pay all the remaining lease payments minus what they got at auction. You have to make them whole anyways, so they don't do anything at all to the car and get what they can as quickly as they can, just to get it off their lot.

And they are this addictive cycle that never lets you get out. No one wants to pay $375 lease payments for a Z and then switch over to $500 lease payments to buy, or have to get a Civic for the same $375.

I can't stress enough what a bad deal leases are.

The average dealer makes an average of $600 on a sale. If they provide the financing that average goes up to around $1000 and if they do a lease they make over $2000. They are insanely profitable.

GTNPU Z

iTrader: (17)

Oh crap! Someone revived a very dead thread! This thread was originally posted in 2002!!!

lane myers

lol!!!

Jaki

iTrader: (21)

LOL I just noticed that when I read you're reply to this... I guess the person was doing a search for something when they found this thread, not sure how else he would've gone back that far and found the thread lol.

Zcarboy

a post that old should be kept dead LOL

n8236

This is one awesome post, now i'm just bumping it because i plan on leasing, but one yr haha