By on January 16, 2010

Go figure...

Doug writes:

I currently lease a 2008 Ford Fusion SEL 5 speed, loaded with heated leather, sunroof, SYNC. It has under 20,000 miles with 2 payments left. The lease end buyout is $14,100. I am debating whether to buy out my lease for cash, or just by a beater – I was thinking of a 1998 Ford Contour SVT in the $2500 range. I am about to start a 5 year sprint to pay off my mortgage, so I don’t want endless repair bills during this time. Buy the lease, or buy the beater?

Steve Lang: We have an old saying in the horse country of upstate New York. “It’s not the horse, it’s the rider.” When it comes to cars, it’s not really the type of car that’s important, it’s the driver. How a used vehicle is driven and maintained before you get the keys will usually be the biggest factor in your own ownership experience.

Having said that I’m not a personal fan of Ford Contours. However your current ride is a bit overpriced as well and given that you have the desire to pursue a debt free life, I would pursue the beater route. Just find something that is comfortable and mildly entertaining if you must. But to be honest your footwear is going to have a far greater impact on your life than the car that you drive.  I would save the money and smile forever.

Sajeev Mehta: I’ve never been a fan of leases for individuals who can’t reap it’s inherent tax benefits. Your buyout is close to the asking price of a used Fusion at retail pricing, which isn’t terribly thrilling to Steve Lang.  I’d buy the Fusion to ensure having a solid car with a service history. If you don’t have the time to hassle with buying someone else’s problems, that is.

And the Contour SVT is a stunning little sedan. Smooth engine, sorted suspension, unbelivably wonderful steering, great seats and decent room for European-sized Americans. Too bad you can’t have it: take it from the guy who recommended two of the last Mercury Cougar V6s to my mother and my best friend: their Duratecs grenaded after 75k of use. Oops.
Or don’t take my word for it. Ask Michael Karesh of TrueDelta fame: his Contour had the same fatal flaw. The silver lining is Hot Rodder specific: a set of MSDS headers removes the faulty pre-catalytic converter at the exhaust manifold, or gut the cats DIY-style.  Too bad that requires working in a cramped, FWD, quad-cammed engine bay. If you need a beater, better look elsewhere.

Like to a 2004-ish Taurus. They are close to indistructable with regular fluid changes so you can live debt free. And fast of foot with the Duratec motor, if you grab some SHO suspension bits for next to nothing. You might not even miss the Contour if you go this route. If I’m wrong, console yourself with the money you’re saving every month. That usually works.

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50 Comments on “New Or Used?: Lease Or Beater? Edition...”

  • avatar

    Check too see if your Ford dealer will give you some sort of “certified used car” warranty on the Fusion if you buy it, and check with various lenders for your terms and monthly payment, that would help too make a decision.
    I’ve realized looking at used cars that most of the exciting ones have been beaten within an inch of their lives, especially as they get older and the years go by.  The 2nd or 3rd or 4th owners tend to be teenage boys or people down on their luck who can’t afford to maintain them.  I’m assuming one reason for the Taurus suggestion is there aren’t to many people auto-crossing Tauruses or jumping them off the local hills.

  • avatar

    Good God, do not buy a 2004 Taurus. This is absolutely not an equivalent purchase to a 5-speed Contour. It weighs significantly more, the transmissions universally suck and there is nothing sporty about it, SHO bits or no.

    You could pick up a CPO Mazda3 manual for around $15k (or less if you don’t need the bigger engine). It’s the Ford Europe thing (plus rice), and you’d have a warranty. There are plenty of other cars with real sporting feel and good reliability in this price range (with CPO coverage) and with similar interior dimensions to the Contour. In fact, I’d say $15k is right near the money spot here. 

    Also, don’t pay $15k for that Fusion, it’s waaaay overpriced and I’m assuming the warranty doesn’t have much left in it. It’s the final sucker play at the end of an ill-advised lease. 

    • 0 avatar

      dwford = Doug

      The Taurus is a non starter. If I am getting a beater, I will need some driving excitement. As far as spending $15k on a CPO car, I would most likely just keep the Fusion rather than someone else’s used car. My biggest concern is the 5 year depreciation of the Fusion. What’s a 7-8 year old stick Fusion goin gto be worth? Money down the drain. I think I would be better off with 1 or 2 10 year old cars that aren’t going to depreciate much more, but will have some added maintenance expense

  • avatar
    Justin Berkowitz

    Leasing companies are often open to negotiation on the buy-out price at the end of the lease. I agree with Tedward that $14,000 seems too high, in spite of it being a loaded car (and being *your* car with a familiar history).
    In addition to cruising eBay, etc, my frame of reference on the price is backed up in person as well. My local Lincoln Mercury dealership is selling a 2009 Milan with the stick for $11,000 and it has only 7,000 miles on the clock. That’s pre-bargaining, too.
    All of that said, I fall on the side of paying off your mortgage sooner rather than later. Getting out of debt is the single best investment a person can make (and I say this as someone with a filthy pile of student loan debt). Once you own the house you’ll have some money to play with, and maybe can buy outright a really desirable car for yourself.

  • avatar

    Buy a used Buick Century or LeSabre from an old person.  They are babied, usually garage kept and because Buick has such bad resale value (not because of quality but because of demand) the used price is extremely inexpensive.  GM 3100 or 3800 pushrod V6 will last you forever as well as the uninspiring but bullet proof 4 speed auto.  From, 2003 Buick Century with 75k miles in excellent condition private party sale ~$4300!  Now if you want a manual transmission…. look elsewhere.

  • avatar

    I would agree on the Century. They are practically bullet proof and if you do need to repair it parts are dirt cheap and a one armed mechanic with a room temperature IQ could bolt them on while drunk. I was recently in Arizona and saw them going for give away prices, like $2500 for clean one. What is more, the are in fact a comfy freeway cruiser.
    Unfortunately, fun to drive and cheap are usually mutually exclusive.

  • avatar

    Buying high performance beaters can be risky.  Unless you can verify that the previous owner took really good care of it, and you know how to look for evidence of past rice or other hack-job mods, you could be in for more than you’re expecting.  Also, the Contour was never the most reliable car to begin with.  If you’re dead set on the Contour I would get a second beater along with it so you have something to drive when the Contour is down for repairs.  One of those Buicks or the Taurus would do well in that capacity.  Extra points if the beater is a pickup or SUV that can tow the Contour on a dolly.

  • avatar

    +1 for that, radimus – I got a better laugh here than from the metacars post!

  • avatar

    Doug,  What do you want, a performance car or an inexpensive car?

    Go cheap but reliable…  Go look at the 6-year experience for everything ranked in CR, pick something reliable but priced low in the market segment (the Century might qualify) and get a copy of that a year or two newer, if you can.   You should be able to do this for $5K, maybe a bit more.  External cosmetic damage is OK.  Bank the rest of your $14K (or buy a quality, dividend-paying stock*) against the possibility of repair (which should be fairly low) and in five years you’re likely to still have most of that money plus interest.   Lean towards cars with good fuel economy, as gas is likely to go higher.

    * – Of course, your best rate of return comes from paying off any debt you may have that has a high interest rate and/or is not tax-deductible

    • 0 avatar

      I want an inexpensive performance car (doesn’t everyone?). I agree that my best money making plan is to elimiate interest payments, which is why I want to get rid of my mortgage!

    • 0 avatar

      Just a thought (and dwford, you may already know this): While it’s true that the “best money making plan is to eliminate interest payments,” be sure to do the math before you completely eliminate the payment of mortgage interest.

      I say this from experience as I’m about to become ineligible for itemized deductions, because I’ve paid my mortgage down. If you’re paying 4.00% to 4.50% APR on a 15-year mortgage (as I was) and your Federal and state income taxes eat up 40% or so of your income, your effective borrowing rate is between 2.40% and 2.70%.

      Granted, your standard deduction makes up for part of this but if it’s between borrowing more to buy a car and using more cash to pay down your mortgage OR using more cash to buy a car and paying your mortgage off a little more slowly, the numbers tend to favor the latter.

  • avatar

    The lease buyout on your Fusion is way overpriced, negotiate it lower or walk away…

    Can’t support anyone going from a loaded euro-handling 5-speed Fusion to the bland, penalty box of a Century or other similar GM… talk about a punishment.

    I may take a bit of looking, but I’d go with an ’03-05 Mazda 6 with a manual…they do exist, though kinda rare. The Mazda 6 is what your Fusion was based on, good driving experience, with japanese reliability and reasonable resale prices (cheaper than a Camry/Accord).

    Just my 2 cents…

    • 0 avatar

      The reason the lease buyout is so high is because the residual was set at 61% for a 24 month lease, which was actually a mistake on the sales manager’s part that I made them honor (I worked there). So I really haven’t paid much on the car at all. That being said, if Ford Motor Credit would sell it to me for arounf $12k, I would be a much harder choice.

  • avatar

    Here’s what I would do:
    1. Let the Fusion go when your lease is up.
    2. Buy something like a $3K Taurus or Crown Victoria or Buick that should last you for a few months.
    3. Buy/lease a Ford Fiesta when they come out this summer. Private sell the beater.

    • 0 avatar

      Actually, this was my original plan, which is why I took a 24 month lease in the first place. But I know myself, and I wouldn’t be happy with a strippy Fiesta, I’d end up with the $21k model, in which case, why not just keep the Fusion and skip repeating the first yeat depreciation?

  • avatar

    Cheap used car and performance are usually mutually exclusive.  The only cheap used cars worth having are either those with really high mileage for their age (if you can verify good maintenance practices and lots of interstate miles) or exceptionally well cared for cars that are over 10-12 years old.  Anything else is just another mystery grab bag that could either be a good car or cost you gobs of money in repairs.  With those, you may as well just go to CarMax or lease another new one.
    For the cheap old car, I have to go with isucorvette or Canucknucklehead – Your choices are limited to cars owned by 80 year old suburban retirees.  In addition to the Buicks, look for Grand Marqs and Town Cars, and the occasionally clapped-out Sable.   Avoid the front drive Caddys, though.
    If you want something more popular, look for a 90s Accord or Civic, but you will be in a car approaching 200K and its history is critical.

  • avatar

    I say get the Contour SVT.  I may be one of the few people who owned a Contour ( 95 SE 5-spd ) that didn’t have any major problems.  Only problems I had was the water pump went at 60,ooo ( easy repair ) and at 80,000 it needed new front wheel bearings.
    It got totalled at 105,000 miles.  I would have drove it until it fell apart, if I had the chance.  Loved that car — had good power and handled great.
    I replaced it with an 04 Mazda 6s 5-spd.  Great car as well……..

  • avatar

    How hard would it be to turn the car in, trace it through the auction, and buy it from whatever dealer ends up with it?

    I’m guessing Ford Credit would eat the loss on the lease, and you can then buy it for less than $14,100 with a no sell manual transmission?   Is this even a good strategy.

    I know the car I traded on my 2002 Grand Marquis LSE (a 2000 Dodge Intrepid R/T on it’s third tranny and second A/C system in 67,000 miles, and an engine with very bad valve tapping) ended up at a local Ford store that bought at auction.   My Mercury dealer didn’t even want it on their lot due to the reputation.

    • 0 avatar

      These things are only worth about $10k at the auction, even with the low miles, and the 5 speed is death on the used car market. They should give me a deal, who else but me even wants a stick shift Fusion?!

  • avatar

    I love these types of threads.  I’m currently finishing a three year experiment on a 1991 Legacy I bought for 500 bucks.  Insurance is almost the price of the car every year but the savings on depreciation and tabs is hard to beat.  Not to mention it takes only a couple of wrenches to work on just about any part of the car.  As a bonus,  I sleep better knowing the college rental next door would spend more energy vandalizing it than they would get back in satisfaction.

  • avatar

    You had it halfway right: The Contour is a wonderful car.  However, not the SVT, you’re already hearing all the engine horror stories.  Find yourself a four cylinder Zetec with the five speed transmission.  Other than the lack of a tachometer, it’s a wonderful little bare bones sport sedan – drive one of those and you understand the Mondeo.
    I speak on being the service person for my sister-in-law’s ’96, and she adores the car to the point that she’s waiting for the Euro Focus before she’s going to considering getting rid of it.

  • avatar

    Aggessively paying off the mortgage AND keeping the Fusion are what’s mutually exclusive here.  Set the Fusion free.  Bet it won’t come back to you.

    For the next five years, make a hobby of buying and selling beaters.  Seriously.  It will give you some variety to keep your interest, and if you’re good enough at it, you could actually make money – or at least virtually drive free while you’re getting rid of the house payment.

  • avatar
    Joe ShpoilShport

    Just my $ .02……I own a 2000 Contour that I bought new.  My wife has been the primary driver (I HATE the seats).  It now has over 100k on the odo.  It has modestly cared for – still has the original serpintine belt, for ex.  The first time it was in the shop was about a year ago for a wheel bearing.  A few other minor things have been fixed by me.

    Sarcasm alert: thanks for the warm and fuzzies, Sajeev.

  • avatar

    Agree on a retiree’s babied Century as the cheapest, most practical Fusion replacement. It sounds like a good idea (in theory, anyway), and is probably better than an old Taurus (certainly better than a Contour SVT).

  • avatar

    The 2002-2005 Civics have been very cheap as of late b/c of how popular they were and best thing is since they took a huge step down in quirkyness and performance so the import boy racers didn’t buy them up and modify them to silly proportions.  The 1.7 inline 4 in a Honda is about one of the smoothest small and reliable engines you can get and the transmissions (auto or manual) are pretty bulletproof (much better than the Contour or Cougar [had a friend who wound up having 3 auto transmissions replaced in his Cougar and he drives like a Grandma]).  This car though costs a little more up front will give you years and years of dependable service.

    • 0 avatar

      I second the vote for the 02-05 Civic.  I bought a 2003 new when I was commuting 80 miles a day.  It now has 155K and it has needed ZERO work on it other than normal consumables (tires, front brake pads, brake rotors and battery).  Still has original muffler and exhaust system, rear brake shoes, etc.  Never has let me down and gets 32-36 mpg in relative comfort.  This car is a keeper and I plan on keeping it for another seven years, if not more!

  • avatar

    A) Consumer Reports says leasing is the most expensive way to operate a vehicle.  Leasing is bad for your financial wellbeing.  Don’t lease again ever.  (Wildcard: New flagship luxury often comes with manufacturer subsidized leases)
    B) Your lease buyout seems high.  A few months back I saw 08 Tauruses with similar mileage being offered for $12,000ish on used lots. Ford Motor Credit probably doesn’t want this car back.  If you want to keep the Fusion, check Edmunds and KBB and make a lowball offer.  Time your offers: 3 months out, 1 month out, 2 weeks out.  Be prepared to walk away.
    C) Try not to worry about repairs or breakdowns.  The psychological impact of a broken car, typically unexpected and with consequent random expense is probably responsible for most reckless new car purchases/lease.  It takes an awful lot of nickels and dimes to add up to the invariable drubbing a $400-600 coupon doles out.
    You’re kicking some serious butt by paying off your mortgage, so it’s obvious you care a great deal about your financial security.  Consider: if the average American bought and kept a new car for 10 years OR bought 2-year-old used cars and kept them for 5, and maintained that pattern throughout their lives they’d retire 5 years earlier than the average American.

  • avatar

    I wouldn’t even consider the ’98 Contour SVT – or any other car that is already twelve years old. Any daily driver that old is going to be on the verge of an expensive repair and a Nasser-era Ford is going to be a lot worse than average.
    But I don’t think a 2008 Fusion for $14K is your best choice, either. You can find a 2007-ish CPO Accord five speed in that price range if you shop around, or you can have your pick of five-speed Civics.

    • 0 avatar

      Why would anyone buy overpriced Honda? According to Michael Karesh of TrueDelta  (, even first year (2006) Fusion’s reliability is on par with Accord (and it was not first year of that generation of Accord).  Plus you suggesting buying at least 1 year older model.

  • avatar

    “… I fall on the side of paying off your mortgage sooner rather than later. ”

    Since this is partly a discussion about money, why is paying off a mortgage early such a good idea? I would argue that it’s not the no-brainer that people think it is. First, you’re trading current-day cash (which is more expensive than future cash given inflation) for an asset whose value fluctuates wildly.

    Given the current job and market conditions, I’d dump the car lease, buy a beater, make biweekly mortgage payments (to satisfy that itch but only if it still leaves you enough money each month to put into savings) and focus on credit-card debt and savings.

    Mortgage rates are ridiculously low right now, much lower than the historical average. There’s an inverse relationship between mortgage rates and housing prices. The low rates fueled the price bubble. If rates rise (as they surely will), that will put even more downward pressure on housing prices which raises the risk that the money you use to pay down the mortgage will simply evaporate should you need to sell your house. If, instead, you save it, you get the benefit of any interest that come from investing it. More importantly, it allows you to build up a cash reserve which allows you to cover the loss should you be under water if you need to sell, or to cover your mortgage for a while if you lose your job. If you pay off the mortgage early, you are making a future choice now that you may well regret. Not having the cash in that situation will make a foreclosure much more likely.

    Paying off your mortgage early might be a good idea, but it really depends on your personal situation.

  • avatar

    I guess I don’t know enough about how many miles are on the Fusion and have you taken good care of it while it was in your posession? If you have paid for all of the things one might to ensure many more miles of  cost free driving, you certainly could not buy a used ca you know any better than the one you have. The money is right and you must like the car, otherwise you would not have bought it in the first place. On the other hand, the idea of driving beaters has many pitfalls. Buy a $ 3,000.00 car, pay sales tax, register it and how long does it run? I agree with Steve Lang that it is not the plane, it is the pilot. Roll the dice on a beater or own the Fusion, and depending on how many miles you drive a year, and if you are not in the car business and have access to cars at wholesale I’d say you, unless you drive many miles per year are better to buy out the lease as ’08 Fusions have a good history of reliability and you just need to keep up with tire, brakes, exhaust expenses and get many years of use.

  • avatar

    My 2 cents…
    I don’t like the question…   Your comparing two options that are based on different budgets.
    Create a 5 year car budget for yourself.  Decide how much of your income you want to spend on a car vs. other things in your life.
    Let’s say you put $5K a year for the car.  (everything.. the car price, interest if you have to borrow, insurance, gas, repairs)
    You could get a nice beater for $3K and worst case you spend $5-7K to rebuild the powertrain like new.  Then again you might get lucky and add some oil now and then.
    You could buy the current ride for $14K and spend a few grand on a warranty.. lots of way to slice and dice, but you need to start with your budget.
    Set the budget and then go get the BEST ride for the money!

    • 0 avatar

      I missed one key point..  How stable is your income?    IMHO, you should ALWAYS own at least one car outright….
      Watch a few repo man shows and you’ll get the idea.

  • avatar

    Faced a similar situation with my Mazda 3, I liked the car enough to keep it.  You sound like a car guy,  so this decision should be about more than money.  If you like the Fusion and it is not giving you trouble,  keep it.  The car is only two years old and is fully loaded for fourteen grand, doesn’t sound unreasonable to me.
    If you are going the beater route, maybe look at a Protege which was one of the most entertaining cars I have ever had, and reliable too.

    • 0 avatar

      I agree.  Cars are important.. they should typically be more than just about money.  He should spend as much of his budget as he wants..  If you don’t own a car outright, make sure you have $3-$4K in cash to buy one outright if you lose your job.

      Life is too short to stew over a few grand, assuming you have the income/cash in the first place.

  • avatar
    Steven Lang

    Okay, now that I have a bit of a better perspective I can recommend the following question.
    What ‘older’ vehicle would represent the best alternative to a Ford Fusion w/ 5-speed?
    Part of me is thinking about an early 2000’s Subaru Legacy. They are extremely fun to drive, usually maintained quite well, and the boxer engine is truly built to last.
    Then you can also venture forth into a Volvo S70/850 Turbo. The stickshift models are rare. But the level of features in these vehicles is very competitive with the ones in your Fusion and the driving experience with the turbo is simply fantastic. This car also benefits from an extensive online enthusiast community. If you’re serious about learning about a car while enjoying a great combination of sport and luxury (and safety), I can strongly recommend the FWD Volvo. I’ve owned over 20 of them.
    A fantastic example of either car should be right around the $5k range. Throw $7k into the mortgage (or other asset) and $2k into learning about the car and customizing it to your liking.
    Drive them. They’re great cars.

  • avatar

    By personal experience buying older used cars is always pot luck. I’ve bought low mileage vehicles under 5 years old with full service histories only for something to go terribly wrong within the first 2k miles. I’ve also bought 15+ year old $200 cars at auction with no history which have lasted for 15-20k miles… so take your pick. Although more likely to involve hassle, I’d stick to the bargain bin auction fodder – you’ll pick out the occasional heap that will lose you $200, but the rest of the cars will probably get you a fair distance before needing replacing.

  • avatar

    It’s good to hear Lang weigh in here.  This question is close to one I’ve been turning over in my own head (minus the mortgage thing).  I’ve come to realize over the last few years that yes an active enthusiast community is a prerequisite for a decent experience with a used car.  Especial for those of us who aren’t afraid to get greasy or want to know where to get the parts for our independent mechanic to install.

  • avatar

    I speak from service department experience. The common mistake (ask ford techs what they thought of the Contour/Mystique) was an absolutely dreadful vehicle. They had recalls from the moment they were launched. An utter nightmare to work on.  Could never understand how they seemed so much less than the sum of their parts. Hated to get a repair order on one. Fuel tank recall, front seat belt recall, V6 cat recall, warped dashboard recall, front crash sensor recall, water pump recall, engine compartment wiring harness recall, heater blower motor resistor recall, headlamp switch recall and the list goes on. Cracked flywheels on V6 were also a fairly common issue. I wouldn’t drive one if you gave it to me. They were shameful.

    • 0 avatar

      Now that you bring it up I recall that every single one I ever saw on eBay has the horribly warped dashboard.

    • 0 avatar

      I thought that was just what happened to pretty much every European based Ford – ever. I’ve owned Fiesta’s, Escorts, Sierra’s and a Mondeo (Contour) and every single one had a cracked dash.

    • 0 avatar

      I recall during the era of the Contour/Mystique that I could walk into the service department of any Ford dealership, and if the mechanic was screaming, cursing and throwing tools, I could guarantee you that he was working on one of these cars. I had two Contours, a ’97 and a 2000, and while I truly enjoyed driving them, they (especially the ’97) were mechanical nightmares. I was on a first name basis with several service managers at the Ford stores in the four areas I lived in while owning those cars, they were there so much. How I managed to drive that ’97  to just under 100k I’ll never know, but it was pretty much finished by then.
      My verdict: comfortable, great driving cars, but avoid them like the plague.

    • 0 avatar

      Yes they did drive well (when in the rare event of  not in need of repair)  but servicing one was an absolute tool throwing cursing nightmare.

  • avatar

    I work with a guy who has a 97 Contour, non-SVT but manual tranny with 220,000 miles on it. It sometimes stops working for days while his mechanic attempts to divine the odd, usually electrical problem that has occurred.

    The biggest problem he has now is that the availability of new parts is getting tough, and even finding used parts in the Northeast is getting difficult. He’s thinking of retiring it in the spring.

  • avatar

    I was faced with same situation 6 years ago. We decided to try leasing because we needed a car, and did not want to tie up lots of cash in down payment. (our focus was to pay off the home)
    When the lease expired, decided to buy the car. In the end, we own our home out-right, and have no car payments. I suffer everyday driving to work driving a boring car, however the feeling of financial freedom overcomes the drive.
    I understand the attraction to buying the beater. Unless you know how to fix it yourself, or have good friends who do, it would better to pass on it.

    As for the other questions about paying off the home, don’t worry about losing the deductions. You can reduce your income by IRA, and 401k. Find a good whole life policy too boot. In time you will be able to find that fun to drive car, and pay it cash

  • avatar

    I think the first issue you need to assign values to is what is it worth to you vs. the car you drive. You certainly can’t compare any beater used car to a well maintained late model vehicle you’ve driven since new.
    The second part of the equation is the purchase price of the Fusion. While it’s on the high side it’s also a  car you’ve driven and maintained since new and obviously like if you’re considering buying it. Financially there are two ways to look at it, 1) the true market value and 2) the fact that you didn’t pay the actual depreciation for the first two years because the total of your lease payments was less than the depreciation so if you buy that car now you will pay what the actual depreciation really is. Also, there is a value to having been the original owner.
    I just turned in an 07 Fusion and Ford Credit would not lower the purchase price so don’t expect that to happen. Apparently they’d rather lose money at auction rather than reduce the purchase price and quite possibly make money financing the car for you.
    To me the overriding  answer to your situation comes from the value you place on the vehicle you drive. I lease vehicles usually every three years and have zero interest in driving a beater. Usually you are able to lease a new vehicle for less per month than the payment would be buying your current lease vehicle. Therefore I would also be considering another new lease vehicle.
    Having spent 30 years selling and leasing cars I want to point out several fallacies in this thread regarding leasing. 1) there is no tax advantage, it is a myth that leasing is advantageous only as a tax write off. If you can write off a lease you can also write off a portion of a purchase. 2) leasing with rare exceptions is always subsidized by the manufacturer whether through inflated residual values, lease rates or lease rebates, it is not only new highline vehicles. The fact of the matter is usually leasing costs less than purchasing because the payments don’t cover the actual depreciation. Also the lease payment is usually considerably less than a finance payment.

    • 0 avatar

      the fact that you didn’t pay the actual depreciation for the first two years because the total of your lease payments was less than the depreciation so if you buy that car now you will pay what the actual depreciation really is. Also, there is a value to having been the original owner.
      This should count for exactly nothing.  What he’s paid or not paid in the past does not matter when deciding how to move forward.  It’s simply a matter of comparing value for money going forward.  The fact that he got a bargain on the lease doesn’t justify a high buyout if he can do better for the same (or less) money.

  • avatar

    Having soaked all these comments (thanks for writing btw, Doug) I think you need to suck it up and drive something NOT FUN until you pay off your debt.  Get over it man, seriously.  There are so many fun cars coming in the pipeline (not just Fords, though we kinda stuck with that given your letter) and they will be so much better for the dollar than anything in your current price range.
    Buy a crap Taurus right now, get a 2010 SHO later for dimes on the dollar.

  • avatar

    One of the factors that took me from driving a $2500 ’97 Escort to a leased ’07 Cobalt was the increasing frequency of surprise repairs that seemed to come at the worst times (ie, just paid off all credit cards, just paid tuition, etc).  When the transmission started to go, so did the car.  Trust broken and wallet empty is a bad way to leave a car.
    The biggest appeal of leasing, and one I think is often overlooked, is complete, total, utter predictability. No surprises. All warrantied while you have it, no worries ever. GMAC takes their $272 a month out of my account and I know that’s all I ever have to spend to drive, gas and insurance aside.  I’d say it’s a huge boon to getting ahead on other debts to be able to call your cost of driving a relatively (and reliably) fixed expense.

  • avatar

    I’m a little late to the party, but I need to defend my beloved ‘98.5 Contour SVT.  Bought new with 34 miles on the clock.  Now have over 132k.  Tracked a few times a year, lots of ugly city driving (those who know DC streets will agree – especially in the post-Barry days), and parked outside the vast majority of its life.
    Sure, it isn’t as reliable as my wife’s ’01 Camry (same miles, nicknamed by me “the appliance”), but it is a helluva lot more fun.  Still relatively easy to work on for a compact FWD sedan.  Engine is in top shape (latest oil analysis was clean), tranny shifting nicely (after rebuild at 100k to put in revised shift forks and quaife LSD), and comfortable as the day is long.  It’s the bits and pieces that get annoying (junky ignition cylinder getting stuck, fiberglass parts held in by plastic rivets falling off, etc.) and start adding up.  But for my daily driver the past 12 years, wouldn’t trade it for the world.

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