Opinions on leasing....

[jh50]

My local Caddy dealership is running a special right now on a CTS lease. It is a $249 a month "smartbuy" for 24 months. I am not a big fan of leasing but this one caught my attention. The ad says it is for the 2.8L engine. What are some of your opinions on this type of deal? Thanks

[JasonA]

I'm not a fan of leasing either. But I'm the kind of guy who keeps a vehicle for a long time. If you're the kind of person who always wants a new car, and doesn't mind always having a car payment (albeit a slightly lower one), leasing is probably not a bad deal.

[Willie Hank]

You may want to check into the 'Smartbuy' plan, it has some interesting features. I was looking at purchasing an Envoy XL back in December (got a Hemi Durango instead), and the salesman pitched the 'Smartbuy' plan. I don't remember all the specifics, but he stated the 'Smartbuy' plan has a lower monthly payment, but you must still deal with a 'balloon', or final payment at the end of the 24 month plan, or give the car back with a small disposal fee. I think you are also restricted to 15,000 miles per year.

In the end, it wasn't for me, giving car back after 2 years was leaving money on the table and I saw no advantage of deferring costs to the 'balloon' payment. Now, it might be advantageous if, for example, your spouse was going to go back to work in a year or so down the road, therefore the lower monthly payment the first two years might be helpful. I not sure what other scenerios may offer it has an advantage, GM also has a 'Smartlease' program.

[ted tcb]

I've leased about ten cars when I was on a business allowance, and I've purchased about ten cars. My wife and father were both CPA's, and they rode me hard re the foolishness of leasing, until I saw the light.

Up here, you can write off approximately 70% of the lease, plus expenses. On a purchase, its a sliding depreciation, starting off at 25% in the first year, then a declining balance. My write offs stayed about the same ... so much for the myth of leases being better for taxation purposes.

The real kicker was 36 month leases, $1000 down, 350 p/m payment, with zip at the end of the lease. Chrysler inspects the car closely, and often will keep your security deposit.

I finance one of my 3 cars ... a Lesabre. A $14k loan, 300p/m over 48 months, and I almost own it. With a lease, I'd have a nicer car, but never any equity ... just a viscious cycle.

Ever try to get out of a lease early, without leasing another vehicle. I've done it once, and the penalty was about 4k.

Halfway through your lease, if your financial situation requires you to reasses your budget, you're screwed ... GMAC or whoever absolutely owns you while your renting their car.

I've tried both, and ownership beats leasing every time, in my opinion.