Established Member
hrguy
Posts: 50
Registered: ‎11-06-2012
Re: So I got Approved, but have some questions on the best direction I should take (finance vs lease

I was in your situation just a few weeks ago - and I chose lease.  I was 3 months out of bankruptcy (4 now), and I didn't want to be in the position to mess my credit up again, so I chose to lease.  Why?  Because I won't go over my miles - and if I start to get close (I too chose to not give such a hefty down payment since I got good incentives), I put my money back into my investments and said "If I get too close to the max miles, I'll buy a hoopty to get me through and drive the car less. 

 

To me, this gives me time to figure out if I like my car and also gives you the ability to buy a more expensive car and get a new one more often than financing, without taking the hit for depreciation.  For me, I used it as a tool to get my credit back in order so that I could get what I really want in a few years.  A three year lease is perfect timing to me.  You're always covered under warranty for the duration of the lease.  Most times, the manufacturer will negotiate the price at the end of the term if you want to buy it at lease end.  If you buy it at lease end though, you will be without a warranty....one disadvantage.  Or you turn it in, and re-buy it after the dealer re-certifies it and drops the price some more....i.e. the lease purchase price at the end is set when you sign the original lease...mine is at 12.5K I think.  I can walk away if I want it at the end if they don't budge on that price...it's off lease, they will recertify it, and more than likely drop the price some more...so I go back and buy it for say..10.5K and it's certified so its back under warranty again.  I saved the depreciation, I got the car under warranty again without buying the add-on warranty they often try to sell you at thousands of dollars, but more importantly, when the lease is up - I have an established relationship with that manufacturer to lease or bu again when a better model comes out...even if my credit did not jump that much during the lease.  Most manufacturer finance companies give you top tier financing for life despite any credit hurdles you have down the road since you established that you at least pay them on-time....just food for thought.  In my case, I got in with Toyota since they own Lexus, when this lease is up, I plan to just port over to Lexus and get what I really want.  So in essense, I used the finance company to not only repair my credit, but I get to drive a brand new car and not have the headache of being upside down when I want to buy my Lexus, because they won't be able to low ball me on a trade since I won't have one. 

 

No you won't have a trade for next vehicle, but  my payments went from mid 400's to the 230's....I pay them their 230 during the lease, and pay my savings account the difference since I am used to that high payment as a guaranteed downpayment to use in three years, so in reality I have lost nothing.  With credit issues, and given an approval to lease, I always recommend people lease since that gives you time to reestablish good auto history for future purchases virtually for free.  Oh and did I mention, I got two years Toyota Care?  So for two of those three years, they are repairing my credit, giving me a car to use, and paying for the maintenance...doesn't get sweeter than that!:smileywink:

Filed BK 7: 2/28/2012 | Discharged: 7/24/2012
POST BK APPROVALS:
NFCU nRewards Secured Visa: $1000 7/12| Apple FCU Secured Visa: $1000 9/12
Toyota Finance Lease: 0% | 0.0008 MF 10/12
Barclay Apple Finance Visa: $2200 1/13
NFCU cashRewards Visa: $2500 3/13