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Old 03-16-2018, 09:47 AM   #61
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This is mostly true, with clarification. "The entire price" is the sum total of the lease payments over the life of the lease, not the sticker price of the vehicle. So, if you are paying $300 a month for 36 months the total of your lease payments would be $10,800. This is the amount your state sales tax is based upon. So if your state sales tax is 6%, you would pay $648 in sales tax.
I'm not sure how the other 5 or 6 states taxing leases upfront administer the tax, but this is not correct here in Texas:

Quote:
Texas laws require that the lessor (the lease company) pay sales tax on the full value of any vehicle they buy from a dealer and lease back to a lessee (you and me).
Texas Sales Tax On Car Lease

The lessee may pay the tax up front or roll the sales tax amount into their lease payments. Either way, this WTF (World Trade Federation ) tax treatment makes the financial premium one pays for leasing even more painful. Here leases are generally limited in popularity to the wealthy or arithmetically challenged.
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Old 03-16-2018, 10:16 AM   #62
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I must say as the OP, I am pleasantly surprised to find such a split amongst us. Getting some good info on the ins and outs of leasing and what to look for. I really thought there would be a lot more buy and holders than leasers.
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Old 03-16-2018, 10:41 AM   #63
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If you get down to it, leasing is nothing but financing a car with a balloon payment, and you are not liable for the balloon note.

You shouldn't worry about the cost of the vehicle, and you don't worry about the balloon payment of you are going to walk away at the end. All you are negotiating is a monthly payment--and that is fully negotiable.

Those with a high FICO score can also request a waiver of the security deposit which is usually the base monthly payment rounded off to the nearest $25.

The biggest plus to leasing is low monthly payments. Second plus is low capital outlay. Third is you don't worry about selling the car or trading at Lease End. You just turn it in and get another vehicle. And if you happen to use the car in your work, your payments are partially tax deductible--simplified bookkeeping.

I would never lease from a dealer charging termination or inspection fees on the back end. I will pay for any damages and excessive mileage, but that is it. Otherwise, I will take my business elsewhere.
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Old 03-16-2018, 10:56 AM   #64
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. I really thought there would be a lot more buy and holders than leasers.
If you really want to know the "split" between car owners and leasers, perhaps a poll might be a better means of determining that.

I feel a lot of lifelong owners simply haven't gotten into this discussion, fwiw.

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Old 03-16-2018, 11:10 AM   #65
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If you really want to know the "split" between car owners and leasers, perhaps a poll might be a better means of determining that.

I feel a lot of lifelong owners simply haven't gotten into this discussion, fwiw.

omni
At a macro level, leasing accounts for about 1/3 of all new car sales, so any poll would be tilted towards buying.

Also, a poll would need to also account for new/used and even those who have car vs. no car. And then there is the whole business vs. non-business use.
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Old 03-16-2018, 11:12 AM   #66
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I'm not sure how the other 5 or 6 states taxing leases upfront administer the tax, but this is not correct here in Texas:



Texas Sales Tax On Car Lease

The lessee may pay the tax up front or roll the sales tax amount into their lease payments. Either way, this WTF (World Trade Federation ) tax treatment makes the financial premium one pays for leasing even more painful. Here leases are generally limited in popularity to the wealthy or arithmetically challenged.
Wow, that would make leasing a very bad deal in Texas. Thanks for the info.
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Old 03-16-2018, 11:19 AM   #67
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Wow, that would make leasing a very bad deal in Texas. Thanks for the info.
Not only does it make it a bad deal to lease here, it also makes it a bad deal to move here with leased vehicles.

After my BIL retired he moved here from Ohio with two leased cars. When he registered them he was charged $1,500+ in additional sales taxes - the difference of what he paid on the leases vs. the full value of the vehicles.

He almost had a heart attack...
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Old 03-16-2018, 11:32 AM   #68
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I'm not sure how the other 5 or 6 states taxing leases upfront administer the tax, but this is not correct here in Texas:



Texas Sales Tax On Car Lease

The lessee may pay the tax up front or roll the sales tax amount into their lease payments. Either way, this WTF (World Trade Federation ) tax treatment makes the financial premium one pays for leasing even more painful. Here leases are generally limited in popularity to the wealthy or arithmetically challenged.
Good point, the taxation method for leases in some states may make a lease a good choice.

Illinois used to tax on the full vehicle price, then several years ago with pressure from new car dealers finally conceded to taxing on the down payment and the monthly lease payments. That saved about $40-50/mo on lease payment based on $30K car.
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Old 03-16-2018, 11:36 AM   #69
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If you really want to know the "split" between car owners and leasers, perhaps a poll might be a better means of determining that.
Just remembered - I did a poll a few years ago

http://www.early-retirement.org/foru...uto-20802.html
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Old 03-16-2018, 11:39 AM   #70
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Yes, they all came with the lease.



That is my term. No additional actual insurance, just peace of mind. These days you cannot sell a used car with a Carfax Scar, you should not buy one that has any either. If you have an accident of any kind it ruins the resale value on any car. With a lease it does not matter.
Not true. They can ding you for lost value at the end of the lease.
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Old 03-16-2018, 11:51 AM   #71
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Just remembered - I did a poll a few years ago

http://www.early-retirement.org/foru...uto-20802.html
A few years ago indeed...2006!

We were young then....

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Old 03-16-2018, 12:00 PM   #72
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Just remembered - I did a poll a few years ago

http://www.early-retirement.org/foru...uto-20802.html
Holy cow... that's 12 years ago. Many things have changed since then which have made leases more attractive today. Might be interesting to see if there's much change today.
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Old 03-16-2018, 12:09 PM   #73
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Holy cow... that's 12 years ago. Many things have changed since then which have made leases more attractive today. Might be interesting to see if there's much change today.
Poll away...
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Old 03-16-2018, 12:48 PM   #74
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If you care to weigh in, there's a 2018 lease vs buy poll here:

http://www.early-retirement.org/foru...ion-91255.html

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Old 03-16-2018, 01:15 PM   #75
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I guess what I don't like about leasing is that after 3 years I may not want to trade in my car. I know I can buy it, but maybe I have reasons to want to delay it for 3-6 months.

I also don't want to be fretting about mileage. Sometimes I'll take long road trips, and some times I'll fly. There are a number of factors, and I don't need whether or not I have room for more miles on my lease as an additional factor.

Or are leases really not that confining?
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Old 03-16-2018, 02:31 PM   #76
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I guess what I don't like about leasing is that after 3 years I may not want to trade in my car. I know I can buy it, but maybe I have reasons to want to delay it for 3-6 months.

I also don't want to be fretting about mileage. Sometimes I'll take long road trips, and some times I'll fly. There are a number of factors, and I don't need whether or not I have room for more miles on my lease as an additional factor.

Or are leases really not that confining?
We've leased 7 different vehicles, didn't find them confining in regards to mileage. Unless our driving patterns change we have a pretty good understanding of how many miles we'll drive. You can increase your miles/year, you'll pay a little more but the $/mile is much less than if you ended up paying excess mileage charges. That said, some times there are early lease turn in offers, up to 3 months in advance. So that's sometimes an option to avoid excess mileage if you are running close to the mileage cap as you save 3 months on miles driven.

As for wanting to keep the car, I actually find it's the opposite. I'm glad that I leased as my wants change. When younger we wanted a more sporty car, so had an Infiniti convertible. Then we had a grandson and we wanted a larger four door for child seat so we could transport him. When we moved away we no longer had that need and instead needed a vehicle to transport stuff, so we got an SUV. We loved each of the cars, but needs changed and glad we had flexibility of getting want we wanted every 3 years.

Also, you typically can keep the car for additional months, you just pay month to month until you turn your car in.

You might find this to be informative and interesting:
5 Car Lease Strategies You Didn't Know About
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Old 03-16-2018, 02:42 PM   #77
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Not true. They can ding you for lost value at the end of the lease.
Nope, been there done that. As long as the car has been repaired they will take it back.
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Old 03-16-2018, 02:47 PM   #78
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Yes, they all came with the lease.



That is my term. No additional actual insurance, just peace of mind. These days you cannot sell a used car with a Carfax Scar, you should not buy one that has any either. If you have an accident of any kind it ruins the resale value on any car. With a lease it does not matter.
I sold a vehicle that had prior damage listed on a carfax. All mechanical work was completed, body panels were replaced with factory parts, paint was factory matched by certified mechanics and workers.

Bought that vehicle for $26,900+title brand new, sold it for $23,900 after driving it for 2years with the accident.

When purchaser asked about me providing a carfax for him as some others had done during his vehicle search, I laughed, and said pay for it yourself.

He still bought the vehicle though, even knowing it was in an accident. NOW, if someone told me they owned the vehicle the past two years, and never been in an accident, and I pay for the carfax and it shows an accident 6months prior, well that's just lieing and I don't hangout with liars, certainly don't purchase vehicles from them.

I'll never forget this time I was accused of scratching a customer's car on a job site I worked at. This was back when I was a total fool, boss convinced me to drive to a homeowners house for an estimate.

It was really awkward when I showed up to do the work with my boss and she accused me of leaving a scratch all down her car. She almost had my boss convinced that I did in fact damage her property.

Thankfully he believed me. This women was absolutely hysterical that her lease return was going to be screwed up because of that scratch and I was definitely at fault and should pay.

I learned a valuable lesson that day, people will believe what they want, hear what they want, and see what they want even if its completely not true.

Can you lease a half-ton 4x4 for less than ($3,000/24+ 500 accident deductible) = $145/month ? That's how much total cost of ownership was for me on that vehicle.

My insurance rate did go up a little though.
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Old 03-16-2018, 02:52 PM   #79
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We've leased 7 different vehicles, didn't find them confining in regards to mileage. Unless our driving patterns change we have a pretty good understanding of how many miles we'll drive. You can increase your miles/year, you'll pay a little more but the $/mile is much less than if you ended up paying excess mileage charges. That said, some times there are early lease turn in offers, up to 3 months in advance. So that's sometimes an option to avoid excess mileage if you are running close to the mileage cap as you save 3 months on miles driven.

As for wanting to keep the car, I actually find it's the opposite. I'm glad that I leased as my wants change. When younger we wanted a more sporty car, so had an Infiniti convertible. Then we had a grandson and we wanted a larger four door for child seat so we could transport him. When we moved away we no longer had that need and instead needed a vehicle to transport stuff, so we got an SUV. We loved each of the cars, but needs changed and glad we had flexibility of getting want we wanted every 3 years.

Also, you typically can keep the car for additional months, you just pay month to month until you turn your car in.

You might find this to be informative and interesting:
5 Car Lease Strategies You Didn't Know About
That's helpful, thanks. My problem with the mileage is that it's not predictable. Thinking about the next 3 years if I was do get a new car now, I might make a drive 3/4 across the country and back each of the next 3 years to go on an extended ski trip, or I might fly or not go at all. Undecided. I also like to do marathons in other areas, and would drive anything 1000 miles or less round trip, and probably fly otherwise, but I don't know which ones I'll do. So I have many 1000s of miles of uncertainty. Do I pay extra for 15K miles when I may very well need 10K, or maybe split the difference with 12K but then find if I am high early, that I'm not making those trips in the last year because of the mileage costs, but I'd prefer to. I understand that there's a cost with higher mileage in an owned car, but nobody is making me predict up front how many miles I drive.
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Old 03-16-2018, 02:59 PM   #80
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Also, do they make leases for folks who put 20,000+ miles a year on a vehicle. That's where DW is at right now. Thank goodness for mileage reimbursement. At this mileage rate, the car is simply a tool to get her to her obligations. I'll buy her the Mercedes when the mileage drops
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