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Is it ever wise to lease? Paging Dentist not really (1 Viewer)

ragincajun

ragincajun

Footballguy
A bit of a story behind all of this so I will try and abbreviate.  I typically buy.  My current ride is a 2005 CRV which is essentially my drive to work and back car and that's it.  My wife's 4Runner was set to be paid off last month but we lost it in the August floods.  Once it was paid off I was going to take it and trade the CRV in on a new family ride while it still had decent KBB value.  Well over the last month I slapped new tires, new shocks, new battery, and a new starter in ole girl.  She is sitting at a Honda dealer right now with her computer fried apparently.  Honda told me that it will be $1400 to swap the computer but that may not be the cause for the car currently not starting.  So it's essentially a shot in the dark to get the car mobile again however there may be other issues.  Other than that I know I need one CV shaft which I can change out.

Bottom line is I wanted to make this bad boy last another 3-4 years till her new Pilot is paid off and then I was going to go buy a new Heep.  A few options are on the table:

a.  Take shot and fix CRV computer at $1400.  BB private party is around 5-6

b.  Trade it in on something I don't want.

c.  Lease a car for 3 years then buy my Heep?

I guess at what point do you stop sinking money into a 12 year old car?

 
I would first Google how to swap out the computer – and a couple of cars I've had and it's literally just snap out and snap in. Go find a junkyard that has a CRV computer and slap it in there. 

 
I always want my wife leasing a car. I'm fine knowing I'll always have a car payment for her but also knowing that it's almost guaranteed she won't break down because she will be driving a car that's always just about new.

 
Depends on how many miles you drive a year. We drive too many miles a year to lease, but we have some friends that live right down the road that lease everything, but they average about 6 to 7k miles a year. Without doing any of the math I would have to say our car expenses minus gas are similar. 

They have lower monthly payments and little to no maintenance on the cars. 

Our payments are higher, but we get breaks. We haven't had a car payment in almost 3 years, but we do have to fix things here and there. 

 
msudaisy26 said:
Depends on how many miles you drive a year. We drive too many miles a year to lease, but we have some friends that live right down the road that lease everything, but they average about 6 to 7k miles a year. Without doing any of the math I would have to say our car expenses minus gas are similar. 

They have lower monthly payments and little to no maintenance on the cars. 

Our payments are higher, but we get breaks. We haven't had a car payment in almost 3 years, but we do have to fix things here and there. 
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If you only drive 6-7k then theoretically you will be I'm the sweet spot of no car payment and no repairs for a long time.

 
kutta said:
I always want my wife leasing a car. I'm fine knowing I'll always have a car payment for her but also knowing that it's almost guaranteed she won't break down because she will be driving a car that's always just about new.
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Stay away from Avery's though.

 
I'm not sure that it is ever wise to lease in terms of Total Cost of Ownership, but there are certainly other benefits to it.

 
I'm not generally a big fan of leases--but there are probably instances where they make sense. If you drive low miles and you own your own business--my understanding is that you could probably write off a lot of the lease payments for taxes (as it could qualify as a company car).  I drive too many miles to ever consider leasing so I've never really had to make that decision. Either way--good luck.  

 
If you don't have cash to buy a car, leasing can be better than financing a purchase, especially if you're saving to be able to buy when the lease expires. It's important to understand the components of a lease, which are somewhat confusing by design, and negotiate just as if you were purchasing.

 
My wife and I only ever lease. It's nice not to worry about anything but oil changes and it's really nice to always have a new car. 

 
ragincajun said:
I would be right around 10-12k a year
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I'm a big fan of leasing.  It's not ideal for everyone, but it certainly makes sense for some and it's not the poor financial decision that many think it is.  If you drive a lot of miles, typically keep your cars for at least 7-8 years, or are looking at a vehicle that doesn't keep its value well, then you're better off buying for sure.

However, there are times you can get more car for less by leasing if you understand how it works.  We started leasing about 10 years ago and it's ideal for us.  We don't go over 12K miles per year.  While I used to keep my other cars for quite a while, I love being able to change every 3 years and have new technology in cars today.  And one of the biggest things is that I haven't had to bring my car for any repairs or even worry about any of those expenses for almost 10 years.  Because leases are almost always on new cars, any repairs are covered under original warranty and pretty rare to begin with. 

First of all, you should read this to get an understanding of how leasing works.  It's about 15 pages long but worth the read if you want to seriously consider.  I also wrote a bit about it before here in this post

Nicer luxury cars that retain their value are ideal for leasing.  In fact, as I mentioned above, if you know how to negotiate a lease, you can have a lower monthly payment on a higher priced car because of that fact (i.e. a $50,000 BMW can have a lower monthly payment than a $35,000 Ford).

In the end, most lower priced cars, particularly domestic vehicles, are better off being bought and taken care of.  If you're looking for something more, then leasing is something to seriously consider.  I'll add that I've never had any issues returning a leased vehicle (actually typically turn it in a little early and get something back as a result).  I've also now done leases with several different brands and there are certain companies that are much better to lease from than others.

 
The Big Guy said:
If you set the lease up right and they calculate the residual wrong, then you can win big. 
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Can you explain this more in depth? I haven't had a car payment in over 20 years, but am thinking about leasing when my vehicle starts eating money.

 
gianmarco said:
I'm a big fan of leasing.  It's not ideal for everyone, but it certainly makes sense for some and it's not the poor financial decision that many think it is.  If you drive a lot of miles, typically keep your cars for at least 7-8 years, or are looking at a vehicle that doesn't keep its value well, then you're better off buying for sure.

However, there are times you can get more car for less by leasing if you understand how it works.  We started leasing about 10 years ago and it's ideal for us.  We don't go over 12K miles per year.  While I used to keep my other cars for quite a while, I love being able to change every 3 years and have new technology in cars today.  And one of the biggest things is that I haven't had to bring my car for any repairs or even worry about any of those expenses for almost 10 years.  Because leases are almost always on new cars, any repairs are covered under original warranty and pretty rare to begin with. 

First of all, you should read this to get an understanding of how leasing works.  It's about 15 pages long but worth the read if you want to seriously consider.  I also wrote a bit about it before here in this post

Nicer luxury cars that retain their value are ideal for leasing.  In fact, as I mentioned above, if you know how to negotiate a lease, you can have a lower monthly payment on a higher priced car because of that fact (i.e. a $50,000 BMW can have a lower monthly payment than a $35,000 Ford).

In the end, most lower priced cars, particularly domestic vehicles, are better off being bought and taken care of.  If you're looking for something more, then leasing is something to seriously consider.  I'll add that I've never had any issues returning a leased vehicle (actually typically turn it in a little early and get something back as a result).  I've also now done leases with several different brands and there are certain companies that are much better to lease from than others.
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Exactly. I lease a Lincoln and it's not much more expensive than a Fusion. Plus, every bell/whistle that I add has only a small impact on the price because that bell/whistle will still be valuable in 2-3 years when I am done with the car. 

 
Uruk-Hai said:
Can you explain this more in depth? I haven't had a car payment in over 20 years, but am thinking about leasing when my vehicle starts eating money.
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When you lease a vehicle, one of the biggest factors on how good a deal it is is the residual.  The residual is what the car will be worth at the end of your lease (typically 3 years).  The residual is expressed as a percentage, so if you lease a BMW, for example, the residual might be 60%.  If the car is $50,000, then it will be worth 60% of that at the end of the 3 years, or $30,000.  When you lease, you are paying for that difference in value ($20,000) plus interest.  That's it.  That's why you can understand that if you were to buy a similarly priced Toyota, for example, and the residual is only 50%, then the car will only be worth $25,000 at the end of the lease and you are paying that $25,000 difference + interest over the length of the lease.  Same cost of the car ($50,000), but higher payments on the Toyota.

The kicker is that residuals are predictions of what the vehicle will be worth in 3 years.  If you're leasing a Honda Accord, a car that has been around forever, that's a stable vehicle and that residual is going to be pretty spot on.  But, if you're leasing a new model vehicle, then they are guessing how popular/successful the car will end up being and will typically err on the lower side of the residual.  And here's the reason....

At the end of the lease, if your car is worth less than the residual, you are not responsible for that.  The leasing company eats that.  You lease Vehicle X and they predict the value of the car 3 yrs from now will be $25,000 but, at lease end, you look up the value of that vehicle and the number of miles you drove and it's only worth $20,000.  You turn the keys over and wash your hands of it and the car company eats that $5,000 loss in value.  However, if the vehicle is worth MORE than the residual because they were conservative, you actually can profit from that.  If the residual was $25,000 at the end of the lease, but you can get $30,000 for the car, then at the end of the lease you can pay the payoff amount (i.e. the $25,000 predicted residual value) and the car is yours.  You then sell it for $30,000 and get $5,000 in profit.

In practical terms, you can use that extra value as "trade in value" for your next vehicle.  But if a dealer isn't going to give you enough of that value, then do it yourself and make money.  I leased a new model vehicle the second year it was out and at the end of the lease, it was worth almost $10,000 more than predicted and I got to pocket that profit.  And again, it never goes the other way against you so you're in a win/win situation when it comes to this.

 
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http://sharplease.com

This free website has a lease calculator and an explanation of how the leasing payments are setup.  It's my site and the true car stuff is outdated, but the calculator can be a help when negotiating payments as if you were buying the car.

 
I can give an example that shows how leasing can be a poor deal.  We looked at a Hyundai lease for their crossover sized vehicle.  The residual was about 15-16K and the purchase price was about twice that.  Now since you are paying for the years that you lease the car, a very low residual is not good as you are in essence paying for more car than you are using.  I asked the sales person if there was anyway on the planet that a 3 year old Hyundai would sell for that price, she said there was no way it could be worth that little and yet could not understand that they price of the lease was way too much.

Someone already said that you have to look at this like any other car purchase and figure out what your percentage of the car purchase value will be to negotiate your total amount of payments that you are going to make.  Don't be fooled by monthly pricing.  They can make that number anything that they want with using your trade in as a cash downpayment towards the price.

 
gianmarco said:
When you lease a vehicle, one of the biggest factors on how good a deal it is is the residual.  The residual is what the car will be worth at the end of your lease (typically 3 years).  The residual is expressed as a percentage, so if you lease a BMW, for example, the residual might be 60%.  If the car is $50,000, then it will be worth 60% of that at the end of the 3 years, or $30,000.  When you lease, you are paying for that difference in value ($20,000) plus interest.  That's it.  That's why you can understand that if you were to buy a similarly priced Toyota, for example, and the residual is only 50%, then the car will only be worth $25,000 at the end of the lease and you are paying that $25,000 difference + interest over the length of the lease.  Same cost of the car ($50,000), but higher payments on the Toyota.

The kicker is that residuals are predictions of what the vehicle will be worth in 3 years.  If you're leasing a Honda Accord, a car that has been around forever, that's a stable vehicle and that residual is going to be pretty spot on.  But, if you're leasing a new model vehicle, then they are guessing how popular/successful the car will end up being and will typically err on the lower side of the residual.  And here's the reason....

At the end of the lease, if your car is worth less than the residual, you are not responsible for that.  The leasing company eats that.  You lease Vehicle X and they predict the value of the car 3 yrs from now will be $25,000 but, at lease end, you look up the value of that vehicle and the number of miles you drove and it's only worth $20,000.  You turn the keys over and wash your hands of it and the car company eats that $5,000 loss in value.  However, if the vehicle is worth MORE than the residual because they were conservative, you actually can profit from that.  If the residual was $25,000 at the end of the lease, but you can get $30,000 for the car, then at the end of the lease you can pay the payoff amount (i.e. the $25,000 predicted residual value) and the car is yours.  You then sell it for $30,000 and get $5,000 in profit.

In practical terms, you can use that extra value as "trade in value" for your next vehicle.  But if a dealer isn't going to give you enough of that value, then do it yourself and make money.  I leased a new model vehicle the second year it was out and at the end of the lease, it was worth almost $10,000 more than predicted and I got to pocket that profit.  And again, it never goes the other way against you so you're in a win/win situation when it comes to this.
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Thanks. A couple of questions:

1. Is there an "official" residual book that leasing companies adhere to?

2. You can really sell a car you've leased at the end of the leasing term?

3. In relation to #2 above, can you use the "profit" to re-lease (a "down payment", I guess) on your next leased car? So, in your example above last-paragraph, could I take your $10k in profit and pay down the lease cost on my next car?

Apologies if these are dumb questions, but this is new territory for me

 
How to get a great lease deal:

1)  Residual is probably the biggest factor -- Forget just about anything 50% or lower.  Anything 60% or higher is excellent.  Cars that retain their value have higher residuals and certain brands overall have higher residuals than others.  Looking at a Ford, for example?  Forget leasing.  Also, ask what the different residuals are for 10K miles vs 12K miles.  Or 36 months vs. 24 months.  Sometimes the residual for a specific lease type (i.e. 12K miles over 36 months) can be significantly better for the same vehicle.  That's your target.

2)  Negotiate a low cost for a car.  And in particular, a car with a significant difference between invoice and MSRP, especially if you can then get that car at below invoice.  Remember, you negotiate a lease the same way you do when you purchase a car.  The reason this matters is that the residual is based off the MSRP, NOT the agreed to price.  So if you look at the following two cars:

Car A has an MSRP of $30,000.  The agreed price of the vehicle that you're going to pay is $25,000.
Car B has an MSRP of $35,000.  The agreed price of the vehicle that you're going to pay is $25,000.

You're paying $25,000 for both cars.  Let's assume a 50% residual for both cars, now also the same.  The residual value of Car A will be $15,000 at lease end ($30,000 x 50%).  The residual value of Car B will be $17,500 ($35,000 x 50%).  Thus, the amount you'll end up paying for your lease (ignoring interest) for Car A is $25,000 (agreed price) - $15,000 = $10,000.  The amount you'll end up paying for your lease for Car B is $25,000 - $17,5000 = $7,500. 

Same price on a car, same residual, but lower payments on a better car.  THIS is how you can win on a lease.

3)   Money factor -- This is the interest rate.  These change monthly as well and are typically not very negotiable but they can be.  Obviously the lower the interest rate, the better the deal and the lower your lease payment.  That said, this is usually not as important as the first two.  There are also programs to help bring this down (like multiple security deposit programs or MSDs).  As an FYI, these change from month to month. 
 

 
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Uruk-Hai said:
Thanks. A couple of questions:

1. Is there an "official" residual book that leasing companies adhere to?

2. You can really sell a car you've leased at the end of the leasing term?

3. In relation to #2 above, can you use the "profit" to re-lease (a "down payment", I guess) on your next leased car? So, in your example above last-paragraph, could I take your $10k in profit and pay down the lease cost on my next car?

Apologies if these are dumb questions, but this is new territory for me
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1.  Yes, each car company has a chart for each lease type for every vehicle of theirs.  This changes monthly.  Vehicle A might have a 60% residual for 36 months and 12k miles.  It might be 62% for 36 months and 10K miles (worth more because it will have less miles, obviously).  It might be 65% for 12K miles and 24 months.  When asking about a car, ask them to give you the residuals for different lease terms for the car you want and then compare.  Any residual they give you is good for that month.  It may change the next month or it may stay the same.  One car I inquired about had a SIGNIFICANTLY better residual on the 24 month lease than the 36 month.  It made no sense to not take the 24 month if I would have ended up choosing that vehicle (ultimately I didn't).

2.  Yes, you can really sell a car you've leased.  At the end of the lease, there's a payoff quote, which is that residual value that was calculated when you started the lease.  You always have the option at the end of the lease to pay that amount and the car is yours.  The only caveat to this option of doing it yourself is that sales tax then needs to be paid.  If it gets rolled into your next lease as a trade in value allowance, you eliminate that.  That's why if there's $3K of equity on a car at lease end, I know I'm not getting that full amount and will likely be happy with $1500 to avoid the out of pocket expense, sales tax, hassle of finding a buyer, etc.  You have to determine at what point it's worth doing it yourself if they aren't giving you enough value.

3.  Absolutely and that's what I've done each time.  You have to sometimes negotiate hard because they won't want to give you the full trade in value (shocking).

I will also say that negotiating these leases takes very little time.  Find a car you like, find out the residual values for that month along with the money factor (interest rate).  Plug the numbers into a lease calculator yourself.  Negotiate those aspects.  Don't let them try to talk to you about monthly payments.  You calculate them yourself with any number of online calculators.  I've negotiated lease deals over the phone in 10 minutes.  If you know how much the car is selling for (check TrueCar, for example for invoice and MSRP), then it's pretty simple.  There are also lease deal calculators that will tell you just how good a lease is. 

 
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CletiusMaximus said:
great info in here gianmarco
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For real. Thanks so much.

I figure, if I'm going to have to have a car payment in the near future, I may as well "go nice" since a buy-payment is going to be several years anyway. I don't put many miles on my vehicles and being under perpetual warranty appeals to me. I'll just have to budget a few less 1/5s of Sambuca a month.

 
Uruk-Hai said:
For real. Thanks so much.

I figure, if I'm going to have to have a car payment in the near future, I may as well "go nice" since a buy-payment is going to be several years anyway. I don't put many miles on my vehicles and being under perpetual warranty appeals to me. I'll just have to budget a few less 1/5s of Sambuca a month.
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Oh, and DO NOT put any money down. Yes, it lowers your lease payment, but most of these interest rates are low to begin with. But more importantly, if the vehicle gets totaled for whatever reason, you DO NOT get that money back.

To put this in numbers, let's say your lease payments are $100/month. Your total lease cost is $3,600 over the three years. You can give them a check for that $3,600 and your lease is paid for. Two months in, the car is totaled. With your insurance, the car company is compensated the market value of the vehicle (has nothing to do with however many payments you've made or money put down) and you get to walk away. Clean slate. Except you now paid for 34 months of a car that you no longer use. You don't get that back.

Whereas I only paid $200 at that time, similar clean slate, but I haven't paid for a lease that I can no longer use.

 
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From purely a financial perspective, it's normally a bad idea to lease.  This is for two reasons:

1. Your lease period is for the years the car is depreciating the most.  Owners get the most bang for their buck when a well maintained car is past the age of rapid depreciation but still generally reliable.

2. The financing terms of the lease is set up for profitability at your expense.  And this can be hard to negotiate properly since arranging a lease outside of the dealership is very rare.  Financing expense can be lowered when buying by adding competition by using (or threatening to use) outside financing such as getting a loan through a credit union.  

Now, this doesn't mean I'm against people leasing.  You might like having a new car and the convenience and peace of mind leasing can provide.  We all spend money on stuff that may not be in our best financial interest so I have no problem with that being cars.  

 
Juxtatarot said:
From purely a financial perspective, it's normally a bad idea to lease.  This is for two reasons:

1. Your lease period is for the years the car is depreciating the most.  Owners get the most bang for their buck when a well maintained car is past the age of rapid depreciation but still generally reliable.

2. The financing terms of the lease is set up for profitability at your expense.  And this can be hard to negotiate properly since arranging a lease outside of the dealership is very rare.  Financing expense can be lowered when buying by adding competition by using (or threatening to use) outside financing such as getting a loan through a credit union.  

Now, this doesn't mean I'm against people leasing.  You might like having a new car and the convenience and peace of mind leasing can provide.  We all spend money on stuff that may not be in our best financial interest so I have no problem with that being cars.  
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This is generally the case for sure.  When you see commercials for leases, if you walk into the dealership and take those terms, you are generally not getting a great deal at all.  And because a lot of people don't understand how leases work or how to properly negotiate one, then I would absolutely agree that leasing is not a good financial decision for most people.

But, if you learn about leasing and know what to look for, then you can actually take it the other way and get some extraordinary deals, especially from a dealership that needs to move a specific vehicle in the midst of a good lease offer.

My wife ended up not liking the car, but I had negotiated terms on a 2016 Hyundai Santa Fe (limited Ultimate trim) with an MSRP of $45,000 with a monthly payment of just over $400/month with taxes and $0 down.  To compare, a normal/decent monthly payment (without tax) on a $45k car is typically $650-700/month. 

That would have been less than $10,000 to lease that car for 2 years (it was a 24 month lease).  If I could replicate that deal over and over, I could lease that car (new version every 2 years) for 8 years and still pay less than the total cost of the car.  And no repair bills out of pocket.  Now, at the end of the 8 years, I won't actually own anything and someone who bought it will have an 8 year old Santa Fe with 80K miles on it that is probably worth $8-10K.  But with the money saved in the actual cost of the car, the lack of repairs, and the "new" version every 2 years, I may have cost myself, at most, $1-2K over an 8 year period.  Plus the money that stayed in my pocket is earning more elsewhere than someone who paid that out of pocket up front to buy it.  That's a no brainer to me. 

The problem is those lease deals aren't available all the time and you have to go looking for them and know what you're doing.  If you calculated the above at $700/month, then leasing definitely loses out after 8 years.  The deal I was able to get?  Lease wins pretty easily.

 
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STEADYMOBBIN 22 said:
I would first Google how to swap out the computer – and a couple of cars I've had and it's literally just snap out and snap in. Go find a junkyard that has a CRV computer and slap it in there. 
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Thought about this, and I have all of the tools.  Problem is that I would still need Honda to reprogram it to the key system.  So another shop visit for a few hundred.

Thanks for the advice G.  Reading up now.

 
Uruk-Hai said:
For real. Thanks so much.

I figure, if I'm going to have to have a car payment in the near future, I may as well "go nice" since a buy-payment is going to be several years anyway. I don't put many miles on my vehicles and being under perpetual warranty appeals to me. I'll just have to budget a few less 1/5s of Sambuca a month.
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The perpetual warranty thing is beautiful. I haven't bought tires in a decade. No battery going dead, no belts to replace, no engine tuneups, no alternators to fix.... Nothing. Oil changes and tire rotations, that's it. That alone is hard to put a price on.

As cars add things like braking and parking assist, I get to use those new options. With all the new improvements, phone connectivity, etc., if my current car doesn't have it, my next one in a short time will. 

And I can drive nice cars without killing my bank account.  Even when I switch vehicles, no big deposits or down payments needed. 

 
gianmarco said:
This article explains how excellent lease deals can be better financially than purchasing
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But it doesn't really explain that.  The example comparison has the buyer over $1,000 ahead.  And it even has the buyer selling the car after three years which doesn't make much financial sense.   I also quibble about a couple of the assumptions.  It is using 5% financing rate for both although, as I've mentioned, a buyer can generally do better when shopping car loan rates.  Second, it assumes the buyer is getting the same residual value after the three years. Assuming reasonable mileage and wear-and-tear, I believe a seller can, on average, get better than the residual value when selling the vehicle privately.  Lease residuals are often set to be "safe" for the lessor.

The article does state this...

However, special leases offer the greatest possibility for best deals because manufacturers can not only discount price and offer low finance rates, but can also create high lease-end residual values — all at the same time. It’s the combination of all these factors that give the edge to promotional leases. A manufacturer’s special lease deal can easily win out over a rebate or 0% loan deal.
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 ...but it doesn't give evidence for it being true nor explains how often this might be true.  

 
Where can you find info on residuals?  And are they always quoted as a percentage of MSRP?

One point that I haven't seen is that lease payments are potentially tax deductible.  Usually, you need to own a company.

 
Also, to convert the money factor to an interest rate, multiply it by 2400.  It's just another way for the auto companies to obfuscate the car buying/leasing process.

 
I am not a car person at all, don't really care about anything except that it won't break down, as I have zero mechanical knowledge or skill. My previous car of 12 years bit the dust recently so I leased a Hyundai Elantra for 0 down, 179/month. Seems great to me, small amount of money for a lot of reliability. I'm hoping to be able to do the ride-sharing thing full-time when the lease is up (I hate driving and love drinking), but if not I'll probably re-up on a similar deal/vehicle.

 
Depends on many things already posted in this thread. Honestly, a lot of the time it comes down to the "comfort" feel of always having a newer, reliable car. Not really fair to knock either side when it's such a personal preference.  The cost difference won't be massive. 

 
chet said:
Where can you find info on residuals?  And are they always quoted as a percentage of MSRP?

One point that I haven't seen is that lease payments are potentially tax deductible.  Usually, you need to own a company.
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You need to call the dealership. 

Yes, it's always a percentage of MSRP. Or they just give you the dollar amount and you have to calculate the percentage of the MSRP that it is.

 
Seems to me that if you're going to acquire a new car (which I suppose one could make a case that it is never financially proper to do so) and will keep it under allowable mileage and in good condition, that leasing is always the better option. Negotiate the lowest possible purchase price and then freeroll the residual gamble.

 
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gianmarco said:
How to get a great lease deal:

1)  Residual is probably the biggest factor -- Forget just about anything 50% or lower.  Anything 60% or higher is excellent.  Cars that retain their value have higher residuals and certain brands overall have higher residuals than others.  Looking at a Ford, for example?  Forget leasing.  Also, ask what the different residuals are for 10K miles vs 12K miles.  Or 36 months vs. 24 months.  Sometimes the residual for a specific lease type (i.e. 12K miles over 36 months) can be significantly better for the same vehicle.  That's your target.
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You can still find a deal on a lease, especially if you live CA/NY/FL.  Ford subsidizes leases on certain models and in certain areas.  There is a benefit to Ford Credit in having a balanced portfolio in short term leases, standard financing, and sub-prime lending.   They update the residuals quarterly.  Residuals are highest at the beginning of a model year, but traditionally there are less rebates.  Lease rebates will vary as compared to standard rebates if you are using a manufacturers program. 

 
CletiusMaximus said:
If you don't have cash to buy a car, leasing can be better than financing a purchase, especially if you're saving to be able to buy when the lease expires. It's important to understand the components of a lease, which are somewhat confusing by design, and negotiate just as if you were purchasing.
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only in the terms of monthly payments....but not in the total cost of ownership of the car

 
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TakiToki said:
Seems to me that if you're going to acquire a new car (which I suppose one could make a case that it is never financially proper to do so) and will keep it under allowable mileage and in good condition, that leasing is always the better option. 
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After cash for clunkers a new car isn't such a bad deal compared to a newer used car.  If you're buying a 7 year old car the used route is better. 

Also, as to the bolded, in la la land, perhaps. Total cost of ownership if you keep the car is much lower.  

 
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