Leasing a Car

[krimynal]

hello everyone , so since we now have the date of when I need to Borden my girlfriend and I are looking at leasing a new car.  She currently own a Ford Focus 2003 which I am still surprised is still running ( let's say he had is fair share of problems and we spend way more money than we should in it ).

Currently we are looking into leasing a new car for 2 or 3 years , but my question is : let's say I lease it with 24 000KM annually , I get a 36 months lease as soon as I get to Borden for my AVN Tech course.  Let's say that in 24 months they tell me that I am posting to Comox ( I'm just making something up right now ) 

What happens with the lease ? do i have to drive it up there ? can I return it back to the garage ? how much of a penalty would that be ? Should I take 24months instead of 36 ?

We never owned a new car , this is our first move , we are looking at a Hyundai Elantra 2017.  Which is the best equipped car we found for the price. 

Thanks

 

[marinemech]

Two options, see if you can add a relocation clause to break lease early (parents have it on their Truck) or tell the finance company that you are being relocated to a new base ( have done this myself when i moved to a different province when i worked as a mechanic at a dealership)

 

[krimynal]

okay thanks I will probably go see different dealers tonight and see if they are okay with that or not

 

[QM]

You seem to have made up your mind about leasing and that's your choice of course. But financially, buying makes more sense. The experts say the best thing, money wise, is to buy a 2 year old car with good reliability ratings, that is in good shape, as you'll save thousands of dollars for a nearly-new car. If you don't like that idea, the next best thing is to buy a highly rated new car and keep it for 10 years.  Good luck, whatever you do.

 

[Harris]

I'll second that.  I recently bought a 2015 Dodge Journey Crossroad edition (so all the bell and whistles) that would have been $40k off the lot last year for 26k this year.  In great shape with 20k km on it.  I know your budget is lower than that but check autotrader for some price indicators for a 1 year old model.  I think you'll be surprised.

 

[krimynal]

I know it makes more sense to buy , or anything else but leasing ...

My problem is , I will only be in Borden for 1-2 years , then who the heck knows .... and I don't want to have to drive 2 cars cross-country if I ever get posted there. 

Hence why the 24-36 months lease.  I know that If I get sent there , Ill just give the car back , then Ill buy a new one over there ( or a recently used one )

 

[Cloud Cover]

if you are considering a short term lease, you can try leasebusters.ca  There are a lot of people who have leased and for whatever reason, want to get out from the lease. I recently took over a lease on a Subaru Impreza (5dr), loaded, for 265 mo.  The original leasor walked away from his down payment and i just took over the payments, and he pre-paid 36000 KM per year.

I have used them several times to take over the remainder of a lease, for business purposes (it's a write off for me). 

But to be very clear, these are short term commitments, usually 12-18 months remaining on a lease. If I was in the market to buy a car, it would be at least 2 years old, have at least 2 years of factory warranty, certified by manufacturer (for example Toyota certified pre-owned) and have new tires, brakes and up to date on maintenance. Buying is the best advice though unless you are not really sure what type of vehicle you want and do not want to commit to a longer term loan.

 

[runormal]

I know it makes more sense to buy , or anything else but leasing ...

My problem is , I will only be in Borden for 1-2 years , then who the heck knows .... and I don't want to have to drive 2 cars cross-country if I ever get posted there. 

Hence why the 24-36 months lease.  I know that If I get sent there , Ill just give the car back , then Ill buy a new one over there ( or a recently used one )

One thing to factor, you said your girlfriend's car will "die" and you are surprised that it runs. I'm not an expert at all with cars (I do not own a car), but could your girlfriend's car die in the next 1-2 years? Or could an expensive part go and then it no longer is cost efficient to keep it running?

Likewise do you know where you are living? Do you need two cars right away?

 

[Occam]

From personal experience, they don't care where you return the car to at the end of the lease, as long as it's one of their dealers.

Leasing makes sense in only two situations, really.  One, if you can write off part of the lease payments as a business expense, and two, if you want more car for the same amount of money per month.  As long as you go into it with the knowledge that you'll have nothing to show for it at the end of the lease, those two situations are the ones that make sense.

Watch the mileage limits attached to the lease.  They're much cheaper to buy at the beginning of the lease than as penalty kms at the end.  The leasing companies really clean up in this regard.

 

[krimynal]

One thing to factor, you said your girlfriend's car will "die" and you are surprised that it runs. I'm not an expert at all with cars (I do not own a car), but could your girlfriend's car die in the next 1-2 years? Or could an expensive part go and then it no longer is cost efficient to keep it running?

Likewise do you know where you are living? Do you need two cars right away?

we already are up that part of it costing too much to run than what it worth ...... I find mindself putting in about 6-7 000$ in it for fixing up bells and whistles .... currently the speedometer is not even working , brake lights are not working , wipers are not working , bunch of different stuff , that on their own are not that costly .... but knowing that you are putting X amount of money in a car that is worth currently maybe 1800$ on the market is just not a good thing.

 

[Good2Golf]

Leasing can also be used in the case of starting with a new vehicle, with precisely what you want it equipped with, with the knowledge that if, at the end of the lease period, you may choose to buy the car outright, then you may find that the overall life-cycle cost to own/operate is not that much greater than had you bought the car in the first place.  The advantage, as some might say, is that you have an off-ramp at the 24-month/36-month point if the car actually doesn't live up to your expectations or fit your requirements at that point.  It also depends on the cost of money...sometimes lease rates can be better than purchase rates, and so you pay less interest whilst 'recapitalizing' your vehicle, and then you pay the (potentially) higher finance rate, only on the residual/buy-out value, not on the original sell price.  You could run the numbers for a few scenarios: 1) lease 36 months, follow up with a 48 month finance, 2) finance for 60-72 months, 3)lease for 36 months, then lease another car for another 36 months, etc...  Some folks will liken a lease to renting an apartment, and that's not quite right.  I lease is more akin to renting a condo with an option to buy if you like the place, or walk if you don't.  The money you spend during the lease gets you to a preferential buy cost that otherwise, would likely be marked up a bit when the car is re-sold to someone else.  I have leased four cars and ended up buying two back and returning two.  One of my buybacks I kept for 12 years and 280,000km and my other I still own after a four year lease and three years of current ownership and about 190,000kms.  In both cases, my overall cost to operate I calculated as being within 4 to 7% of the outright purchase finance option, which for me was well within acceptable bounds, given the comfort it gave me of knowing I had a number of branch-plan options as to how to continue or not, with the vehicles.  Someone saying "buying is always cheaper" may not appreciate that that is not always a true statement, depending on an individual's own situation.  Run the numbers, but don't be scared to consider a lease.

As well, and nothing to do with a lease, you do know that they CAF will/may ship a car as well, so if you do still have two cars when the time comes for your next posting, driving one and shipping the other may (subj to confirmation) be an option.  Heck, if you really wanted to, I think you can ship a vehicle and travel to your new place of duty by other means (CAL, train, bus, etc...).

:2c:

Regards
G2G

 

[cupper]

If you buy, and don't want to drive two cars across country, could always sell one and use the proceeds to but a car when you get to your posting.

 

[krimynal]

well ,

Plans got changed pretty quickly haha ! ( I guess that's just the army thing )

I went on to look at leasing a new Mazda3 2016 .... and stumble upon a Mazda 3 Sport ( hatchback ) GS 2014.  Very well equipped , touchscreen display , cruise , bluetooth , electric windows and doors. 6 speed standard with the skyactiv motor.

And well we bought it yesterday haha , so now I'm the proud owner of a new car ! now just got to figure out where to apply for the immatriculation of the car ( not sure of the English term there ) and also I will need to look at insurance !!

If anyone knows where I could look to get the best  quotes I would really like that !

 

[dapaterson]

CANEX offers insurance - check their website.

 

[Good2Golf]

CANEX offers insurance - check their website.

Congrats!  The Mazda 3s are really nice cars, my son did months of research and ended up going with the 3 GS (sedan).  He loves it and I have to say its a nice driver when I visit him and he lets me behind the wheel.

immatriculation = Registration

Everybody's mileage may vary, but I have my car and house insurance with CANEX (The Personal) and have been very happy with them over the years...and I do refresh my research every couple of years).

Cheers
G2G

 

[krimynal]

I guess I'll check once I'll get to Borden with Canex directly. 

And yeah the 3's are amazing, and honestly , this car just don't want to use gas .... it's crazy .... I filled it up yesterday , it showed me I had 641KM one 1 fill ..... I drove 135KM .... and when I got home it said I still had 611KM left on the tank ....

Mind you I was going 108KM/H on cruise control .... but still ... it's just insane the amount of gas I will save in the long run !

 

[Good2Golf]

SkyActiv is pretty good.  My son was initially a bit disappointed (he had moved from a Jetta TDI that got 1100-1200km/tank on the highway, but VW's post-Dieselgate attitude was crappy), but it didn't take long for him to find that for a gasoline car, the 3 was pretty hard to beat...and fun.

Enjoy!

Cheers
G2G

 

[SupersonicMax]

We own a Mazda 3(3016) and a CX-5 (2015) and we are super satisfied with both!  Great mileage and comfy ride!

 

[Blackadder1916]

We own a Mazda 3(3016) and a CX-5 (2015) and we are super satisfied with both!  Great mileage and comfy ride!

I know that car makers keep getting more and more ahead of themselves in marketing a new model year, but that is just ridiculous. 

 

[Occam]

We just got rid of our 2009 Mazda 5 (air conditioning went, and didn't want to chase the problem), and bought a 2016 Mazda CX-5 - wife loves it.  I drive a 2012 Mazda 3 GS Skyactive for commuting 100 km round-trip daily, and it's been great too - until someone rear-ended me the other day.  Waiting to see if it's a writeoff or not.  The CX-5 gets just as good mileage as my 3 does.  All three vehicles required little more than scheduled maintenance to date.

For insurance, we used to be with The Personal, but when we found out we could get insurance through TD Meloche Monnex (group insurer, my wife qualified as McGill alumni with their Security National underwriter), we switched right away as they blew away The Personal's rates.  When I joined the PS five years ago and became an IBEW member, I qualified with Meloche Monnex under their Primmum underwriter, with even better rates than my wife got.  From a claims point of view, TD Meloche Monnex has been great so far with my claim; towing covered, had a rental car the next morning, getting my back checked out as it's a little sore from the hit.  I have their "Grand Touring Solution", which amongst other things covers $1500 in rental car coverage, and 5-year replacement cost coverage - so if my 2012 is a writeoff, I'll drive away in a new 2016 Mazda 3 similarly equipped.  Check out their website to see if you're eligible for insurance through them by virtue of being in one of their groups, and they give online quotes.