Just curious if buying out a lease is ever a good idea or if there is a better time during the lease to buy than waiting until the end of lease term to buy? (man, thats a long sentence )
I have been researching and the PeopleFirst rates seem to be nice, but I made the devil's deal when I originally leased the car (traded in my wife's car which had negative equity) and I have a fairly high lease-buyout balance.
I love the car and the way we've been working things in my family is my wife typically 'inherits' my car so we will probably buy-out the lease at the end of term anyway.
Should I buyout the lease now? (btw, it was a 4yr/12k lease on a '02 S2k with about 29months remaining)
Should I wait a year or so longer?
or should I wait until the end of the lease to buy? (buyout is $19k)
Thanks for any help or tips
Love my car, but I made a bad financial decision when I made the deal and I would like to make lemonade out of the lemons

 

It really makes no difference. If you have time remaining on the lease you're liable for the balance of the payments + the buyout anyway. Unlike a mortgage, there's no break from the leasing company for paying down early. The only way it makes sense to do this is if the buyout+balance of payments are equal to substantially less than the wholesale value of the car. In that case you could even sell it and make a few $ but I suspect that's not the case.

Leasing to buy is usually a losing proposition unless you managed to get an incredibly high residual % and the car depreciates substantially less than calculated by your leasing company.

 

if you do the math, the payments with the lease (4 years) and the buyout (assuming you finance that over another 4 years) will come out the same is you lease for 2 years, and finance the rest over 4 years, or just bought from the beginning for 4 years....

The total cost comes out about the same give or take a few hundred dollars!

 

There is always a buyout for the car, much like if you financed it.... Get the figure from the leasing company, and go from there.. Now is as good a time as any, because peoplefirst.com has lease buyout financing at 5% APR. It will go up sooner or later.......

 

Sorry guys, but that's not correct.

The earlier you re-fi or buy it out, the more it's gonna cost you. You have a lot of negative equity at first and slowly goes towards being more even at buyout. In most cases the buyout is roughly the book value of the car. If you got your payoff right now and got a book value on your car, you would realize the huge difference.

Wait until the end.

 

What Slick Rick said... even at the end, I'd just lease another car... now-a-days, a car without a warranty... eeeeks

 

That's the whole premise of leasing. That's the price you pay for having lower monthly payments.

 

Buy it straight up. then you run less of a chance of getting ripped off.