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#1 Jul 09, 2019 8:55 pm

Expat
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Leasing cars in the US

I see the adverts on CNN, about Lease this car put down $3500 and pay $300 a month fro 36 months.

If I lease a car in the UK although there may be options to buy, generally you are renting a car or vehicle for a term during which they maintain it, and at the end of term you hand it back.

I never see adverts that say BUY this car over 3 years.... Is that what they mean?

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#2 Jul 10, 2019 7:35 am

Real Distwalker
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Re: Leasing cars in the US

No, it's a lease.  You give it back at the end of the lease.  That said, there is usually a depreciated "residual value" applied to the vehicle at the end of the lease for which you can purchase it.

There is a concept called "rent to own" that is usually applied to things like furniture and televisions.  If you rent it long enough, you own it.  It usually costs two to three times the retail value of the product to rent to own.  Needless to say, it is only used by people with such poor credit that they can't get a loan and such poor finances they can't save up.

Car leases aren't like that.  They can be a good value for certain people.

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#3 Jul 10, 2019 6:55 pm

houston
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Re: Leasing cars in the US

I've heard the good and the bad about leasing. It works for some, especially as a business vehicle. Others will lease for 2 to 5 year contract so they are always in a good, reliable vehicle. I agree that it is more like a long term rental.
The contracts can vary and there are strict mileage limits. If you drive more than the agreed contract, there are penalties to pay.
There are a lot of people that lease. They always have sharp wheels to drive. The price of purchasing a new vehicle these days is ridiculous. Especially when their value depreciates so much once driven off of the dealerships lot.

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#4 Jul 10, 2019 9:36 pm

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Re: Leasing cars in the US

Real Distwalker wrote:

No, it's a lease.  You give it back at the end of the lease.  That said, there is usually a depreciated "residual value" applied to the vehicle at the end of the lease for which you can purchase it.

There is a concept called "rent to own" that is usually applied to things like furniture and televisions.  If you rent it long enough, you own it.  It usually costs two to three times the retail value of the product to rent to own.  Needless to say, it is only used by people with such poor credit that they can't get a loan and such poor finances they can't save up.

Car leases aren't like that.  They can be a good value for certain people.

OK, thanks, got it... Leasing in the UK is usually a commercial proposition often for large companies to have their fleet of probably 2 years or a specified mileage. As per the insurance company I worked for, where the Senior Managers got a band of vehicle they could chose from, or pay a supplement to go up a band. The loss assessors just got what they were given. For me it was a pain in the butt as the managing company at one point controlled servicing etc on my Lexus 430, and they would sanction work I as a qualified mechanic knew didn't need doing. Ultimately I got the car taken off management, and either put it in the garage when it needed it, or if something simple like brakes I just did them myself.

HP is the usual route for domestic vehicle owners. Servicing etc is all on the renter who will at the end of say 3 years be the owner. It's not cheap, but people are not low life's with a poor credit rating, it's just how it's done, unless you are LOADS OF MONEY, in which case you just drop a bundle on the counter. Then the police come round to see if you are laundering money  smile

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#5 Jul 10, 2019 9:49 pm

Expat
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Re: Leasing cars in the US

houston wrote:

I've heard the good and the bad about leasing. It works for some, especially as a business vehicle. Others will lease for 2 to 5 year contract so they are always in a good, reliable vehicle. I agree that it is more like a long term rental.
The contracts can vary and there are strict mileage limits. If you drive more than the agreed contract, there are penalties to pay.
There are a lot of people that lease. They always have sharp wheels to drive. The price of purchasing a new vehicle these days is ridiculous. Especially when their value depreciates so much once driven off of the dealerships lot.


If you think the price in North America is ridiculous don't check UK prices. It will make you weep. Its at least pound for Dollar, and with the drop in value of the Pound it is probably worse again.


Having said that I just did a quick comparison on Range Rover Sports and maybe if I went to the trouble of currency conversion it might not have been that different. Maybe the British customers have bitched enough to get better vehicle prices these days?

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