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  #25  
Old 05-08-2015, 08:49 PM
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Re: Asking for help on how to not get ripped off.

My lease on a 14' Limited 4x4 with a MSRP of $38k, 15k miles/year, $1,000 down, 36 months is $480/month.

Basically $480/mo over 36 mo = $17,280 + $1,000 down = $18,280 after 3 years. You then have to add up whatever you owe if you decide to buy it outright, and determine what the market value of the vehicle is at the time of trade in/buy out. Sometimes you can actually make money on a lease, sometimes you're going to lose money.

I decided to lease because I was unsure of Jeep, having never owned one before. I wanted the option to just be able to wash my hands clean if need be. Leasing is also a great option if you don't have money to put down. Buying a vehicle is great, but try taking out a $38k loan with nothing down, yea talk about high monthly payments...

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  #26  
Old 05-09-2015, 08:44 AM
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Re: Asking for help on how to not get ripped off.

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Originally Posted by polizei View Post
My lease on a 14' Limited 4x4 with a MSRP of $38k, 15k miles/year, $1,000 down, 36 months is $480/month.

Basically $480/mo over 36 mo = $17,280 + $1,000 down = $18,280 after 3 years. You then have to add up whatever you owe if you decide to buy it outright, and determine what the market value of the vehicle is at the time of trade in/buy out. Sometimes you can actually make money on a lease, sometimes you're going to lose money.

I decided to lease because I was unsure of Jeep, having never owned one before. I wanted the option to just be able to wash my hands clean if need be. Leasing is also a great option if you don't have money to put down. Buying a vehicle is great, but try taking out a $38k loan with nothing down, yea talk about high monthly payments...
$507/mo rent for a Limited is rediculous.
Why people think it's easier to get out of a vehicle with a lease is beyond me.
It's WORSE, you are locked in for 3 years.

If it looks to expensive to "own" then perhaps you should lower your price target.
Because it's more money to lease.
You're just bending the numbers to make yourself feel better.
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  #27  
Old 05-09-2015, 09:18 AM
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Re: Asking for help on how to not get ripped off.

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Originally Posted by mswlogo View Post
$507/mo rent for a Limited is rediculous.
Why people think it's easier to get out of a vehicle with a lease is beyond me.
It's WORSE, you are locked in for 3 years.

If it looks to expensive to "own" then perhaps you should lower your price target.
Because it's more money to lease.
You're just bending the numbers to make yourself feel better.
This is exactly what I have so much difficulty wrapping my head around. If all I had in cash was $6K to $10K, then THAT is the price range of vehicles I would be shopping for....... NOT looking to rent a $47,000.00 SUV for God's sake. And we wonder why a full one third of the United States population is broke, and hanging by a financial thread?
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  #28  
Old 05-09-2015, 03:29 PM
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Re: Asking for help on how to not get ripped off.

A car is only going to depreciate, so we're only talking about how much of our money is tied up in the car. Leases lock you in and are a bit more confusing, but a purchase de facto locks you in for at least a year or two because of depreciation and length of financing. To think someone is paying advertised lease terms is like thinking they paid MSRP. It would be the person who gets ripped-off, not the mechanism of payment.

I am about to end a lease and walk away with thousands of $$ because the market value is high. If I had purchased, I would just have more of my own money coming back to me after living with higher payments for the last three years. If the market value was lower, I'd be able to walk away from the lease, a purchase trade in might leave me with some of my money coming back but some of my money would have disappeared in the value lost. I'll admit, as for lease terms, I don't quite like the timing, it's been three years and I have to do it now, but such is the lease. I wasn't tricked or fooled or ripped off or deluding myself, I knew it was coming.

Going back to my original point, the price the car is what matters, that's primarily where you get ripped off nor not. Then you talk financing, and a lease can be a desirable financing option if you fit the mold. Now to say you should only buy what you have cash in hand for, that's a philosophical position not germane to this discussion - that's an anti-financing position, anti purchase finance, anti lease. That's great if you choose to live your financial life that way, but even that person loses money in vehicle depreciation.
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  #29  
Old 05-09-2015, 03:41 PM
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Re: Asking for help on how to not get ripped off.

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Originally Posted by billt View Post
This is exactly what I have so much difficulty wrapping my head around. If all I had in cash was $6K to $10K, then THAT is the price range of vehicles I would be shopping for....... NOT looking to rent a $47,000.00 SUV for God's sake. And we wonder why a full one third of the United States population is broke, and hanging by a financial thread?
On the other hand, maybe people would be better off financially if they paid a vehicle off and kept it for a couple of years.

MY JGC had an MSRP of 42K. After negotiations, my total with all the registration fees and taxes was just shy of $39K. I put down around 4K and my payment is still only about $500/month. I can do what I want with it and there's no mileage limits.

Once it's paid off, I own it free and clear and whatever time I have with it is my own. That monthly payment goes into savings.

Look, people should do what makes them happy, but don't go thinking that leasing is cheaper. In 6 years (two leases), my vehicle has already been paid off and you've caught up to me in payments and down payments.

That's why people are upside down financially: they never stop making payments.

BTW: I thought about doing what you're doing...i.e, trying out the Jeep with a lease. I also had never owned a Jeep before, much less one with so many power features and computer controlled things.

Then I did the numbers and it didn't make sense, especially if there was any chance I would buy the vehicle out at the end of the lease. The balloon payment alone would put me in the hole compared to financing.

Plus, while I haven't paid the vehicle off, it's still mine. I can sell it and get out any time after the initial interest and depreciation payments that would allow me to pretty much break even on it. That means, I can likely get out sooner than on a lease.
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  #30  
Old 05-09-2015, 05:27 PM
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Re: Asking for help on how to not get ripped off.

I just purchased my 2015 Jeep Grand Cherokee last month. I paid for it outright. The last time before that I bought a new car was when I bought my truck back in 1991, 24 years ago. I'm still driving it.

My neighbor, on the other hand, has had more new cars than I could possibly count between him and his wife, in the 18 years we've been living in our houses. (We both bought new from the builder in 1997, 18 years ago). He was always giving me jazz about my "old cars". Telling me my cars were older than his kids, how I "owed it to myself" to drive a better car, ect. I never paid it any mind.

A while back I was out spraying for weeds and I saw him out front. I could tell something wasn't right. He came over and I asked him what was up. He told me they kicked his refi on his house. He said they told him he didn't have sufficient income. I told him the banks were cracking down since they lost their a$$ in the housing fiasco. Too much borrowed money, people walking away from loans, etc.

He went on to defend, saying his new payment would be less than his old one, and how he never missed a payment, etc. Then he asked me what I new was coming..... What is your interest rate on your mortgage? I told him I didn't have one, my home was paid off. PAID OFF!, How the hell did you manage that?

I said John, I don't buy new cars every 15 minutes! I told him to add up every car or lease payment he has made on both he and his wife's cars since they moved in 18 years ago. Then subtract what you owe on your house from that. I guaranteed him it would add up to be more than enough to not only pay off his house, but both of his cars he presently owes on. He walked away grumbling.

Moral of story. The more often you buy new vehicles, the less money you will have for other, more important things. It sounds simple enough, but too many people don't follow it. And as a result they live their lives around borrowed money, and payments that never end.
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  #31  
Old 05-09-2015, 06:06 PM
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Asking for help on how to not get ripped off.

It's a long term plan without the effects of "having to get something new" to make it work. I usually do a 5 or 6 year buy with $xxxx amount downpayment and a trade in. But I also keep the vehicle for at least 2 years past the payoff. Also tend to stay in the price I know is easy regardless of what life throws at me. So far it's been working for me.

Good luck with your decision and remember! Do the math! Then Take what makes sense.


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  #32  
Old 05-09-2015, 08:11 PM
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Re: Asking for help on how to not get ripped off.

Quote:
Originally Posted by mswlogo View Post
$507/mo rent for a Limited is rediculous.
Why people think it's easier to get out of a vehicle with a lease is beyond me.
It's WORSE, you are locked in for 3 years.

If it looks to expensive to "own" then perhaps you should lower your price target.
Because it's more money to lease.
You're just bending the numbers to make yourself feel better.
And that's your opinion. Perhaps I didn't want to "lower my price target."

I was in a vehicle that was paid off, I decided I wanted something new this time around. Is it the smartest financial decision? Of course not...but you could say the same thing about anything in life. Have you ever taken a vacation? That's a complete waste of money!
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  #33  
Old 05-09-2015, 09:47 PM
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Re: Asking for help on how to not get ripped off.

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Originally Posted by polizei View Post
And that's your opinion. Perhaps I didn't want to "lower my price target."
I think you missed the intent.

It wasn't intended for you to buy a lesser vehicle, but instead negotiate better on the one you got. Too often, people seem to forget to do that on a lease.

To get a good lease, you have to haggle just as much as if you were buying. In other words, don't negotiate payments: negotiate the price of the vehicle. When the price is lower, the payment will be lower and you get the vehicle you want at a payment that is as low as it can be.

Then you get them to throw things in to make their price closer to yours if it's not quite there. Those things might be dealer added features or free service. Maybe they have the exact vehicle you want on the lot, but it has a sunroof - and you don't want to pay for the sunroof.

With a lease, get them to include more miles. Either way, you shouldn't be paying a lease payment as high as what someone can buy it for.

Finally, once you've settled on a price for the vehicle with all the trimmings you want, start talking trade-ins.

If you don't get what you want, walk away.

That goes for both buying and leasing. That's how you don't get ripped off.
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