New vehicle leasing vs financing through dealer vs LOC finance

[westcoastrider1982]

Currently looking at possibly buying a new/er truck.
Do residential construction and although I’ve had advice from my accountant just want to see what you guys and ladies do.

I’ve never leased and only bought used vehicles and essentially write off my vehicle expenses like fuel and repairs. My trucks were always older and have never claimed any sort of depreciation.

Any new/er purchase would have to be financed somehow through leasing, financing through the dealer or through my home equity line of credit.
Heloc has the benefit of being flexible meaning I can pay as little as interest only every month or paying more if I’ve had a good month but the rate is 4.5%. Can also buy used if I want using heloc.
GM finance rate on new is 3.99% along with some great incentives on 2019’s!
Leasing equals lower monthly payments with a buyout at the end?

 

[justwannahavefun]

Take this as my 2 cents I am no means an accountant but a small business owner as well. My last few vehicles have been leased. I like driving newer more technically advanced vehicles and with leasing I know I will always have a newer vehicle without the higher payments of owning. I can go get a new car every three or four years without worrying about resale.
I also know that in the long term leasing is a way more expensive option. But the write offs help.
Someone once told me that leasing is for those who can’t afford new, but also for those that can afford new but like new all the time.

 

[badbadboy]

If you are driving it 80% for business a lease will help more tax wise. Buying has capital cost depreciation that’s a sliding scale as time goes on. In the end lease is usually best for a biz

If you are considering buying out the lease after the term, it can be negotiated up front what your buyout might be in the end. If you’re walking away at the end make sure the km overage is also negotiated up front too. I believe the magic number is still 20k kms annually.

 

[m_clock]

The best way is to purchase a 2-4 year old vehicle that has been leased and returned to the dealer. Dealers make way more money on leasing so they will probably push that on you, but you should avoid doing that. Here is the scam:

Dealer leases you a new vehicle on a 5 year lease.
At year 2 they start start contacting you about the newer, safer, faster truck with better fuel economy.
They offer to do you a "favor" and allow you to break your lease if you want to lease the newer one for only xx more per month.
They rope you into a new, more expensive lease, and they have your original truck to sell.
They do this because more than 50% of consumers will fall for this crap move.

You want to buy the lease return. It will be 30% depreciated, still new (enough) and financing should be less than 5% (I just did this on a 2 year old vehicle at 3.95%)

Toyota really makes a solid product, if you want domestic get Ram. Avoid GM.

 

[westcoastrider1982]

The best way is to purchase a 2-4 year old vehicle that has been leased and returned to the dealer. Dealers make way more money on leasing so they will probably push that on you, but you should avoid doing that. Here is the scam:

Dealer leases you a new vehicle on a 5 year lease.
At year 2 they start start contacting you about the newer, safer, faster truck with better fuel economy.
They offer to do you a "favor" and allow you to break your lease if you want to lease the newer one for only xx more per month.
They rope you into a new, more expensive lease, and they have your original truck to sell.
They do this because more than 50% of consumers will fall for this crap move.

You want to buy the lease return. It will be 30% depreciated, still new (enough) and financing should be less than 5% (I just did this on a 2 year old vehicle at 3.95%)

Toyota really makes a solid product, if you want domestic get Ram. Avoid GM.

Great info!
Let’s leave aside the Ford vs GM vs Dodge stuff as everyone has their opinions.

Is there any tax benefit to buying new vs used?
It seems like you can only claim up to a value of $30,000, which is stupid because what the hell can you buy for $30,000??
Unless it’s a regular cab 2wd work truck with hand crank windows!!

 

[JimDandy]

I don't know about leasing, but when buying new you can sometimes get very very low interest rates. My last car I bought and financed throughthe dealership with 5 year loan with 0% interest. (yes, ZERO interest !!!) . From what I understand though, the interest rate can't be negotiated, it is whatever the manufacturer is offering dealerships.

JD

 

[Wakeup]

we usually lease new over 4 years , dealer or bank with $1.00 payout at the end,used we pay up front. Seems to work.

 

[Y21982]

I lease all my company vehicles and end up buying them out after and sell them privately

 

[westcoastrider1982]

I don't know about leasing, but when buying new you can sometimes get very very low interest rates. My last car I bought and financed throughthe dealership with 5 year loan with 0% interest. (yes, ZERO interest !!!) . From what I understand though, the interest rate can't be negotiated, it is whatever the manufacturer is offering dealerships.

JD

There’s 0% and also .99% too but then you lose the cash incentive. Total vehicle price goes up $7000.
It’s actually better to take the cash incentive and the 3.99%.

 

[Theguyfromvictoria]

There’s 0% and also .99% too but then you lose the cash incentive. Total vehicle price goes up $7000.
It’s actually better to take the cash incentive and the 3.99%.

Not necessarily correct. The incentives are generally set up so that it’s basically a ‘wash’ - low APR or cash back
A $50,000 truck at 3.99 is roughly the same as $57,000 at 0%, give-or-take $500 bucks.

The cash rebate is best when you truly have $50K to pay-in-full.

 

[storm rider]

The best way is to purchase a 2-4 year old vehicle that has been leased and returned to the dealer. Dealers make way more money on leasing so they will probably push that on you, but you should avoid doing that. Here is the scam:

Dealer leases you a new vehicle on a 5 year lease.
At year 2 they start start contacting you about the newer, safer, faster truck with better fuel economy.
They offer to do you a "favor" and allow you to break your lease if you want to lease the newer one for only xx more per month.
They rope you into a new, more expensive lease, and they have your original truck to sell.
They do this because more than 50% of consumers will fall for this crap move.

You want to buy the lease return. It will be 30% depreciated, still new (enough) and financing should be less than 5% (I just did this on a 2 year old vehicle at 3.95%)

Toyota really makes a solid product, if you want domestic get Ram. Avoid GM.

When I bought my new truck 2 years ago the salesman first pointed out a lease back.It was a fully loaded Nissan Frontier Crew Cab.I turned it down,yeah it would have cost me $8000 less but it had an automatic transmission and a 5 foot box.I took the King Cab Pro-4X that had a 6 speed manual which was brand new and that truck was sold as soon as I was going up the ladder on the ramp from Sarcee onto Stony Trail....to me it was the Firefox in the form of a truck....even muttered "boy is this a machine" as I ramped up the RPM from 2000 to 4000 in 4th and laddered it over to 6th and was cruising at 100.....the salesman was holding on for dear life LOL.

Dont ever lease....it is just a really expensive car rental which fucks you in the end with a crippling balloon payment.Go over the mileage and you are fucked.

SR

 

[westcoastrider1982]

Not necessarily correct. The incentives are generally set up so that it’s basically a ‘wash’ - low APR or cash back
A $50,000 truck at 3.99 is roughly the same as $57,000 at 0%, give-or-take $500 bucks.

The cash rebate is best when you truly have $50K to pay-in-full.

I’m like most people, have a mortgage(home equity line of credit) and sadly don’t have an extra $50k laying around.
If I suddenly came across that I’d either buy the truck outright or throw it towards the LOC.
My LOC is 4 1/2% where financing through GM is at 3.99%.
LOC has the flexibility to pay off as slowly or as quickly as I feel for the most part.

 

[Theguyfromvictoria]

Leasing is a terrific idea for a small business owner if they go into the process fully informed and eyes wide open.
Have lots of people been taken advantage of and fleeced ? Yes. Not sure they fully understood the nuances of leases and makes me feel bad that they feel ripped off. Should never be that way .

PM me -

 

[Gardener]

In today’s environment 3.99% lease rate is very high. I just leased a car at 0.00%. I’ve seen tons of ads for 0.99% and 1.99% lease rate. You can do way better than 3.99%.

When leasing a car, always negotiate the financing rate and the price. Both are totally negotiable and will have a major impact on your monthly lease payments.

 

[MB Mod]

A spammer drags up a year old thread and you guys have to help him