Lease VS Purchase

[Anonymous]

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@CostantinoA wrote:

My credit isn't good because of medical bills.  My auto history and credit cards is perfect.  I have a bunch of inquires because of the 3 autos I have purchased in the last 11 months.  I make almost 100k take home a year now.  I know I am losing a bunch of money with buying new cars all the time.  I know I will have at least one of the  auto loans paid off in 6 months.  My wife and my goal is 2016 Cadillac Escalade for me and 2016 Cadillac ATS for her.  Since one of my loans on these Chevy cars is from GM Financial, I am sure I can get some nice terms after 6-12 months of payments.

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But if you want a better rate, let your inquiries fall off first or at least wait until your score goes up.

[Anonymous]

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@CostantinoA wrote:

My credit isn't good because of medical bills.  My auto history and credit cards is perfect.  I have a bunch of inquires because of the 3 autos I have purchased in the last 11 months.  I make almost 100k take home a year now.  I know I am losing a bunch of money with buying new cars all the time.  I know I will have at least one of the  auto loans paid off in 6 months.  My wife and my goal is 2016 Cadillac Escalade for me and 2016 Cadillac ATS for her.  Since one of my loans on these Chevy cars is from GM Financial, I am sure I can get some nice terms after 6-12 months of payments.

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@CostantinoA wrote:

Yes! I have 90 inquries on my Experian.  I have purchased 3 cars in last 11 months.  By the end of the year, I will only have 77 inquires and 27 will be older than a year.  Out of the 77 remaining, 24 were from buying the 3 cars.

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You have 50+ inquiries still from seeking new credit. Your auto history is not perfect, as you yourself have stated you don't keep cars long. Without those 2-3 years of payment history PER LOAN you aren't building car credit. My scores were lower, with one paid and unpaid medical collection, and I was given 1.9% financing on a new Escape from Ford, which means there is more going on with your credit than you are letting on. That's fine, you don't have to tell us it's your business, but clearly there are bigger issues you have to resolve. 

I don't think anyone on this board is going to tell you you're on the right path, until you show willingness to actually try to build your credit, as that is the focus here, no matter how many ways you rephrase the question. I realize it's hard to be patient, but if you want a strong credit profile, you have to be. If your medical bills are all paid, you should be focused on GW efforts. If they are not paid, you should be focused on paying them instead of buying new cars. I make a significant income, but because we have 20K in outstanding medical bills (not in collections) I chose to buy a ford instead of an Audi. It's the kind of choices we have to make in life, especially when we have children (I have 1, you have 3). If you make larger payments you'll have both of these cars paid off in 2 years, you'll have significantly better car credit, you won't pay too much interest, and if you keep the rest of your finances in order paying on time and building and stop seeking new credit, you'll be getting 0% offers on new vehicles. 

[Anonymous]

OP I sell Cadillacs and to be honest without a hefty down payment there is no way to get a 700 payment. People leave at 1200-1600 a month when buying an escalade with no down on a lease. When my customers are looking to lease I tell them to put the monthly payment they want and times it by 36-48 months and see what that totals too. Typically aim for 50%(to be safe) of the cars msrp see if you like the payments so when you go into buy it's a little more/less for example

700x48=33,000
700x36=25,200
Rough estimate msrp of one is 85,000 neither of those payments/terms is 50% of msrp.
85,000/2= 42,500/36= 1,150(that's a lot closer to what it will really be) dealers like to pull you in with low payments but they aren't real. Or they are and require 10,000 down.

[9CLINE]

Wow.. so much great advice and info given already...You know working to improve credit gives best terms....but in the end some people are gonna do what they gonna do,,,then ask how to get out of that fiasco next.....
@dabrian mentioned the diff. posts, that sounds determined to do your own thing..That's the great thing about this forum people give the best advice whether it's what we want to hear or not.....Wishing you the best now and later....

[9CLINE]

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@Anonymous wrote:
OP I sell Cadillacs and to be honest without a hefty down payment there is no way to get a 700 payment. People leave at 1200-1600 a month when buying an escalade with no down on a lease. When my customers are looking to lease I tell them to put the monthly payment they want and times it by 36-48 months and see what that totals too. Typically aim for 50%(to be safe) of the cars msrp see if you like the payments so when you go into buy it's a little more/less for example

700x48=33,000
700x36=25,200
Rough estimate msrp of one is 85,000 neither of those payments/terms is 50% of msrp.
85,000/2= 42,500/36= 1,150(that's a lot closer to what it will really be) dealers like to pull you in with low payments but they aren't real. Or they are and require 10,000 down.

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Thanks for the info and data points,,follows a lot of what I was thinking based on research I've done...

[Gmood1]

OP makes sure you stick with a preapproval's through your personal financial institution in the future. Some of these dealers run your inquiries up when going through their finance department.
Also in certain states it's legal for them to tack 1% extra on to your rate. Sometimes the dealer isn't the best option for car loans.

Also its not always what you earn..its what you do with it. Just ask all of the former millionaire athletes that are broke today. 😉

[CostantinoA]

What I was meaning by auto history is perfect is that I have had 12 auto loans in the last 12 years and never paid late and never a repo.  I only keep my loans 10 months max which I have learned from here and the dealer, is not doing me any favors on my auto score.  I am not hiding anything else about my credit. It is all medical bills!  There is about 10 of them that total 60k.  There are few that are about a year old but most are 2-3 years old.  I did have a BK in 2008 but it is only showing on one of my 3 reports thanks to Lexington Law.  I just started caring about my credit again in September 2014 when I purchased auto loan.  That is all I had.  Then March of this year, I obtained my frist credit card again since my BK in 2008.  I am very new to rebuilding.  Why would I hide anything here?  This is a site to put the info out there and help evach other build and learn from each other.  I had 531 score September 2014.  Now I have 2 of my 3 scores in the 600 range.  I think a 70 point jump with obtaining 15 credit cards and 2 auto loans and a **bleep** load of inquires is going in the right direction in 11 months.  Every week my score is going up around 5 points latley.  I have no desrie to pay those old medical bills as they are aging. I am leaving the past in the past and moving forward.  Everything from March 2015 has been paid in full and will contiune to be paid in full.  As for "stop seaking new credit".  That is the plan until my scores are over 660.  Then I will try for some prime cards and get rid of these subprime and secured cards.

[CostantinoA]

I was going to put 20k down on a lease with gap coverage.  I heard it is a bad idea to put that much down on a lease but it will get the payment where I want it.

[CostantinoA]

I have always depended on dealer to take care of the financing.  I think moving forward, I might come in with my own.  I know that I am with GM financial, I should be getting those advertised interest rates and payments.  I have heard from numerous sources that if you do the right things with GM, they will treat you great after 6 months on good payments.

[Gmood1]

Patience is a virtue! Hold on to your loans for at least 18 months if you can keep the car buying bug under control. lol

I made the mistake of paying one of my vehicles off way too early(10 months). And no it didn't do my credit much good.

I'm holding on to the second vehicle payment for a couple of years as my credit lines age, before I pay it off.

I have a friend that was doing the same as you. I finally convinced her to ease up on the car buying.

She earns close to $400K a year. I talked her into buying rental property and focusing on that instead of investing in depreciating items.

Those items don't amount to a hill of beans when all is said and done. At the rate she's moving, she'll be able to retire before she's 50 years old!

She's 42 now. Think about what you can do with that $20K, you're considering throwing away on a leased vehicle.

It's your money, but one day you'll look back and wish you'd held on to it just a little bit tighter.