Lease a Car with No-Money Down? - Mothering Forums

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#1 of 20 Old 07-15-2009, 12:15 AM - Thread Starter
 
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Does anyone have any BTDT experience with or suggestions on how to lease a car with no money down?

I will be going this Friday to try and get a car and I need to know if there are any techniques or tips that may help me?

My credit score is about 709- is that too low to have a no-lease deal? Also, I'm in NJ if that matters at all.

Will they run my credit and tell me that day whether or not I qualify?

Any help is much appreciated!
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#2 of 20 Old 07-15-2009, 02:02 AM
 
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Yes they will run your credit that day. Your score is going to depend on what reporting agency that dealer or bank is using. The lease is going to depend again on what the dealer and bank is willing to do in this economy. Zero down on a lease is high risk... expect high monthly payments and possibly a large payment due at turn in.... If you have zero down what type of monthly payments are you comfortable making? Do you have income to allow for the lease? What type of mileage will you be doing?
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#3 of 20 Old 07-15-2009, 09:15 AM - Thread Starter
 
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Can you explain why I would have a large payment due at turn in if I have a zero-down lease?

I am comfortable making payments around $250 which is a bit more than what I pay for my current lease.

My income over the next few years will be able to handle a $250 lease but not much more.

Yearly mileage will probably be very low, between 8K-10K if not less. The lowest mileage contract I will probably get is 10K though.
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#4 of 20 Old 07-15-2009, 12:47 PM
 
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Why do you want a lease?


It's a no win deal. You get screwed by them.

Resistance is futile Matey
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#5 of 20 Old 07-15-2009, 01:07 PM
 
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Originally Posted by Thystle View Post
Why do you want a lease?


It's a no win deal. You get screwed by them.
:

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#6 of 20 Old 07-15-2009, 01:41 PM
 
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Don't lease! Leases are nothing but a profit maker for the dealership and a no win situation for you. Trust me I worked for Toyota for awhile. Add up the payments for the term you would be paying them and it will amaze you how much you will have paid and how much you owe plus all the charges they tack on for extra mileage and wear and tear. Here is how they work:
http://www.daveramsey.com/etc/askdav...ntItemId=10367

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#7 of 20 Old 07-15-2009, 02:44 PM
 
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I didn't want to be the first to say anything, but I agree. Leasing a car, unless it is a business that is leasing it for an employee, is absolutely the WORST financial mistake you can possibly make. Leases to individuals should be illegal, as they border on being predatory.
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#8 of 20 Old 07-15-2009, 03:07 PM
 
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Originally Posted by excitedtobeamom View Post
Don't lease! Leases are nothing but a profit maker for the dealership and a no win situation for you. Trust me I worked for Toyota for awhile. Add up the payments for the term you would be paying them and it will amaze you how much you will have paid and how much you owe plus all the charges they tack on for extra mileage and wear and tear. Here is how they work:
http://www.daveramsey.com/etc/askdav...ntItemId=10367
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Originally Posted by velochic View Post
I didn't want to be the first to say anything, but I agree. Leasing a car, unless it is a business that is leasing it for an employee, is absolutely the WORST financial mistake you can possibly make. Leases to individuals should be illegal, as they border on being predatory.
ditto. Lease = LOOSING money and being fleeced.

Why not take that money, save it for a few months and buy a beater. Then save for a year and buy a better beater, and so forth.

I don't understand having a new car one can't afford when a used "beater" can be within range, but I am out there on this one as I find new cars to be real $$$ wasters and will never buy one again (I have, so I'm not a genius of course).

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#9 of 20 Old 07-15-2009, 03:22 PM
 
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If you have good (or decent) credit, but no down payment and need a car ASAP, why not check out BUYING a new car? Dealerships are desperate for customers, there are lots of good deals with incentives, and if you have good credit, might get a really cheap interest rate, too.

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#10 of 20 Old 07-15-2009, 04:03 PM
 
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I leased a car a few years ago and got an awesome deal. No money down and actually got 1k back at signing. The paymt was very low for a 30K car. My DH laughs because I'm pretty tough on the salesmen. I come from a family of dealers, studied the car business and worked in it for many years. It took me several weeks to get the deal I got though. It meant going to numerous dealers and negotiating-walking out most times. They don't run your credit unless you have agreed on a price-work a deal. You can still walk out and say you want to think about it. I knew my credit score was high so I had no worries there. I also ended up getting a car that was a demo with a few miles (2k) but that did not bother me. There was no big paymt to pay at the end and I actually purchased the car at lease end- below cost. This also took some work but the lease companies don't want all these cars back. They dropped their price 4 k in a few weeks of negotiating.
You just have to smart and stick to your numbers. Do your research before you go into the dealer and be tough. I'm sure its alot tougher out there now w leasing but it does not hurt to try.
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#11 of 20 Old 07-15-2009, 09:50 PM - Thread Starter
 
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I do not have the cash to buy a car right now. I need my cash for other things.

Frankly, I wish I didn't have to get a car at all b/c it's just so expensive overall having a car. But, I need one for school- getting to clinicals and such.

I realize not many here are fans of leases. I am leaning towards leasing b/c I have no clue where I will need be in 3 years and I don't want to drag a car with me that I won't necessarily need (e.g., if I get a job in NYC, I want to get rid of the car)

I would consider buying a new car for no money down also- that's an option in addition to leasing. Either way- whether I buy a new car or I lease a car, I need to know how to negotiate so that I put no money down. Any suggestions? Even if you don't agree with the leasing thing, if I were to buy, please give me suggestions on how to negotiate no money down. What is the process? How do I negotiate down the price? Do you have any good resources?

I feel like I am a salesman's dream. I'm young and I know nothing about negotiating car deals. Sigh.
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#12 of 20 Old 07-15-2009, 11:30 PM
 
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I have a lease that I got with no money down. Of course I wish I didn't have to have one, but I see it the same as renting a house vs. buying...what can you afford? For my family, we thought we had a great car, brought it in to fix A/C, and oh wait, now we need 5K to fix it (or it would literally fall apart). We didn't have the money. We had no savings. But we could squeeze a couple of hundred a month out for a lease. Option of waiting to save up for a clunker wasn't an option, we have two little ones that need to get to doctor apts etc....so, now we're in a 3 year lease, one year done, I realize I'm paying more for it overall. I'm an informed client. We have a brand new reliable car that we'll now be able to buy at the end of the term. So I personally have no problem with our lease, but if you can avoid it of course try to.

I mean if you think about it renting a house is even worse, they make all the profit too and if you move you get nothing. So I don't think it's a huge evil scheme, I think it's works for some people and not so much for others. It's a business, I don't think it's a secret that they're trying to make profit. I have a car, they have my monthly payments..it's a good relationship right now that will end just fine in two years.

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#13 of 20 Old 07-15-2009, 11:35 PM
 
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Just go into it with a cynical mind and see what you can get. Also go with the mindset that you are just looking, don't make a deal the same day. Go home and think about it, and if someone tries to tell you that they can only get you a good deal if you sign today then tell them "oh well then thanks for your time, I'll cross your brand off my list then and move on to the dealer across the street." and then leave. They'll get your number and be calling for sure.

All that said, I got a smoking deal on the car I leased for three years from Saturn. That was in the late 90's though, so I don't know what there is out there now.
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#14 of 20 Old 07-16-2009, 03:06 PM
 
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Originally Posted by Thystle View Post
Why do you want a lease?


It's a no win deal. You get screwed by them.

agree. You couldnt pay me to lease a car.
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#15 of 20 Old 07-16-2009, 03:09 PM
 
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The higher the residual on the car, the better lease you can get.

In this market, I think the type of deal you can get is totally dependant on your credit. They are practically giving cars away to people with good credit. Bad credit? Not so much. Good Luck.
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#16 of 20 Old 07-16-2009, 04:19 PM
 
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The higher the residual on the car, the better lease you can get.

In this market, I think the type of deal you can get is totally dependant on your credit. They are practically giving cars away to people with good credit. Bad credit? Not so much. Good Luck.
There are so many factors that come into play with leases. Not all (but most) benefit the manufacturer or leasing company.

Like what is mentioned above, lease costs are lower if the car is expected to have a high value at the end of a lease.

For example - a Volvo SUV that costs $45,000 might have a residual value at the end of the lease of $30,000.

A $45,000 GMC Yukon might have a residual value of $20,000.

A lease on the GMC is going to cost more because the car is worth less at the end of the term.

The manufacturer/leasing company is going to build more into the monthly lease cost and possibly require money down at signing. They want to make sure, as much as possible, that they don't loss money. (I used to work in finance and the bank had a leasing company as well as a residual insurance company.)

Depending on ones requirements, a lease might make sense.

We leased a car about 4 years ago. We knew we would get a new car after 36 months no matter what, meaning any vehicle we got would be replaced after 3 years.

When I ran leasing costs against buying/financing costs + estimated value at the end of 36 months, leasing came out to be much cheaper, like $300 per month cheaper.

I did the same at the end of the lease and as I expected (and hoped!) we still came out better leasing, leasing was $200 per month less expensive than buying/financing/reselling the same car. (changing rates of return came into play.)

It worked for us because of the following -

We took the base model offered. Had we wanted to upgrade, the lease cost would have jumped dramatically.

I knew we wouldn't go over the milage allowance.

All maintenance was included. In three years I did not spend one dime on maintenance, tires, inspection - nothing. (the tires weren't include, I just didn't wear them out.)

It was a no money down lease.

The manufacturer was obviously desperate to get the model year off the lot before the new model year arrived.

We had good credit.

The deal we got was a good one but it took a lot of analysis. We had a set cost in our head and shopped from there. We didn't care about brand, just that we needed a 4 door sedan. Had I been hung up on a particular brand/model, the savings would have been blown.

A Google search will yield many lease versus buy calculators.

Mom to DS, born fall 05 after ,,, wife/best friend to DH We have
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#17 of 20 Old 07-16-2009, 04:27 PM
 
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Originally Posted by kimiij View Post
I would consider buying a new car for no money down also- that's an option in addition to leasing. Either way- whether I buy a new car or I lease a car, I need to know how to negotiate so that I put no money down. Any suggestions? Even if you don't agree with the leasing thing, if I were to buy, please give me suggestions on how to negotiate no money down. What is the process? How do I negotiate down the price? Do you have any good resources?

I feel like I am a salesman's dream. I'm young and I know nothing about negotiating car deals. Sigh.
Something to watch with $0 or 0% interest purchases is the price of the car -
The manufacturers/dealers will charge more for the vehicle to make up on the loss of interest income.

Mom to DS, born fall 05 after ,,, wife/best friend to DH We have
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#18 of 20 Old 07-16-2009, 05:04 PM
 
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Leases in addition to being a rip off are much less flexible than just buying a car and having a loan. If you end up driving more than you thought you don't have worry about going over in you mileage or if you don't need a car period before the three years you can just sell it.

We have bought two new cars without spending any cash on the actual date of purchase. In both instances we could have paid with cash but chose not do. Actually, the second time I wanted to pay cash and paid it off before I even made the first payment. Anyway you negotiate the price and then do the finance part second on cars purchased in a dealership. We always sell our old cars latter ourselves since we drive the same cars for long time.

Honestly, I'd go to a credit union and see what your options are. Most of the time you can buy a car 4 or 5 years old and get the same rate as a new car. I think you'd be better off with a four year old car if you are not going to own it forever anyway.
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#19 of 20 Old 07-17-2009, 01:58 AM
 
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Do you have to get a car tomorrow? I would second going and getting a loan approval at the credit union and getting a slightly used car. If you're looking at selling in 3 years be really careful that you're paying enough monthly that you won't be upside down when you need to sell!

Lisa, mama to A (3/05) and R (11/07) and L (8/10)
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#20 of 20 Old 07-18-2009, 01:38 PM
 
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I agree that leasing a car is one of the worst financial decisions you can make, especially if you don't know where you're going to be in a couple of years. If you move to NYC and you own a car, you have an asset you can sell. If you have to get rid of a leased car to move to the city, you'll have to PAY THOUSANDS to the dealer if you give it back early. My in-laws have always leased cars, but they got a rude surprise recently. Their engine blew on the GW Bridge - they were on the hook for a new engine for their leased car - it sucked.

I bought a two-year-old Toyota Corolla, and my payments are $220/month. So you don't have to get a beater to stay under your $250 price range.

If you're looking for car-buying information, check out http://www.edmunds.com/

Knowledge is power, especially when buying cars, so research research research before you make your move. I promise you it will be time well spent.

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