Lease pricing....

BlueCrayon · April 20, 2017

Not wanting to argue, but some things to think about.

Let's assume you can buy this LT truck new for $40K out the door and finance for five years at 2% interest. This gives you 60 payments of roughly $700 for a total of $42K over five years. Let's assume at the end of your five years you sell/trade/etc the truck for the $17K you mention. You have spent $42K to receive $17K of trade in. In other words $25K of your payments have been eaten up by depreciation. If you account for the possibility of an accident that dings your trade in value or the expense of an out of warranty repair you come out even worse.

But for the sake of argument let's assume the truck is perfect for five years. It has cost you $25K in depreciation or $5K a year. With the lease mentioned on the Denali you are paying roughly $18K over three years or $6K a year. With this option you are driving a nicer trim level truck. The truck basically is never out of warranty. If you have an accident the lease provides for GAP coverage. If your lease is a lemon it is someone else's problem at the end of the term. Since your monthly payment is $200 less a month than with purchase, put this cash in a savings account every month and at the end of the lease (36 months) you have $7200 to put on your next lease. (Personally I'd hang on to the cash, putting lots of money down on a lease is not smart)

With new vehicles there is no way for a buyer to "win." My dad used to say that if someone gave you a brand new car/truck, you'd need a full time job just to keep it on the road with insurance, gasoline, maintenance etc. As I've gotten older dad's words seem to be more accurate every day.

Leasing doesn't make sense for everyone. If you drive a lot or are especially hard on your vehicles it won't work.

Anyway my $0.02... Peace everyone.

Well said. Leasing may cost more in the long run, but I'm one of those types that prefers the peace of mind of not owning anything. I totally understand why some people hate that feeling and would rather have something at the end. I don't have to worry about anything and I can have a brand new vehicle every 3 years. I also only drive around 10k/year.

ewbldavis · April 20, 2017

My guess is part of the higher lease payment is the higher truck cost.

We leased for $428/mo. on a double cab. Love the truck. May buy it, may get another, may get a 2500.

I figured it out - and it costs more to buy the lease out then if I just bought it, but the cost impact is minimal (maybe $2000) and if there is serious issue or I just want a different one, I can walk away after 3 years.

I have a year left to decide

mxzeatr · April 20, 2017

Our lease on our 17 GMC DBL Cab ends up costing us 11,460, this is for a well optioned SLE and 12k miles a year. It's our first lease, so we will see how it goes.

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Back in a Bowtie · April 20, 2017

i leased because i would never have been able to afford the payment if i bought it from day one. Love the truck so im going to buy it at lease end. Yea i know it costs me more over the life of the loan but so what... so does a 30 year mortgage vs 15 years but you have to be able to live during those years so you stretch it.

jrhoyt84 · April 20, 2017

Part of what drove me to lease was the cost of used pickups. 30k+ for 14s or 15s with 50k miles? No thanks

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arkenzo · April 20, 2017

Leasing is not only for people who can get a much higher end vehicle for a low monthly payment, it's also for people who telecommute 2 days out of the week (my wife), and drive to work 3 days, round trip is 40 miles (my wife) and likes to change vehicles often (my wife). We opt'd for a 12k lease, could have gone 15k, but 12k still allows for a nice buffer zone in mileage.

Ianwelch001 · April 20, 2017

I got my 17 Denali CC for $457 a month with 0 down and 0 out of pocket. Would have been $444 a month. It I wasn't a fan of the 22" chrome wheels so I agreed to pay an additional $13 a month for the 22" black wheels

dasimmon · April 20, 2017

Part of what drove me to lease was the cost of used pickups. 30k+ for 14s or 15s with 50k miles? No thanks

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its absurd right now...right there with u

jrhoyt84 · April 20, 2017

its absurd right now...right there with u

When I bought mine, the dealer had it's twin, used, with 17000 miles and a year older, for like 3k less than a new one with the rebates. Even the salesman lagughed

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Havvkeye · April 20, 2017

i leased because i would never have been able to afford the payment if i bought it from day one. Love the truck so im going to buy it at lease end. Yea i know it costs me more over the life of the loan but so what... so does a 30 year mortgage vs 15 years but you have to be able to live during those years so you stretch it.

And this is what is wrong these days. You can't afford something you shouldn't "stretch it" and take the more expensive option (especially on something as long as a mortgage), you should find something within your budget. The whole have to have exactly what I want RIGHT NOW is not a good mentality.

edit: This was the mentality that made balloon payment mortgages seem like a good idea and really wrecked a lot of people financially.

Silverado Steve · April 20, 2017

Sure leases work for some people. However, ever wonder why dealers are so quick and persistent to push them on buyers? One dealer wouldn't discuss purchasing options for 30 minutes when I bought mine, but was pimping leases. Are dealers really looking out for you, or are they highly trained in the arts of fuzzy math with the intent to make sure you leave as much of your hard earned cash in their building. Dave Ramsey has outlined this many times over, leasing makes little sense only you are an LLC and can write off the payment as a business expense on your taxes. Buying used and driving it until the wheels falls off is the most economical, buying new and driving until the wheels falls off is the next. If you can't afford either, you are looking at a vehicle you cannot afford.

OP has asked every possible question regarding buying...4.3 vs 5.3, used, lease, buy from Canada, model year leftover...etc. You are either very indecisive or very thorough in your research...lol

dagwood2001 · April 20, 2017

Never understood the lease haters.....as said multiple times above, ever second I have the vehicle it's under warranty and the interest is nearly nothing. Yes I know (at least in PA) there's an extra point in taxes, but I look at it this way-there are some things it's important to me to own: my house.....my clothes...my guns.....get what i'm saying?

A truck, and mine was MSRP 48K, so not cheap (at least by my standards) is just not something critical for me to own........to each his own.

Tribs77 · April 20, 2017

^^These 2 gents get it^^

There are some smart shoppers who lease based on their needs/uses out of the vehicle. Don't drive a lot of miles, want a new vehicle every couple years, don't plan to mod, in need of cheap/affordable transportation to get from A to B...a lease could be the smart decision.

The buy vs. lease debate...I get the sense that too often people (I know) are leasing because they WANT a higher trim, more expensive model and are drawn into monthly payment buying. Dealerships/ sales people love these buyers because they always come out on top. But I hear all the justification of why it (seems to) work for them.

My friend recently traded his already paid for perfectly fine '10 Silverado with 65K miles because he "wanted" a new 2016. He leased because he's saddled with other expenses. Then he tells me that he'll just buy it when the lease is up. It's a short sighted financial decision and all he did was kick the can down the road. But hey...it's his money, right?!

CFRED70 · April 21, 2017

OP has asked every possible question regarding buying...4.3 vs 5.3, used, lease, buy from Canada, model year leftover...etc. You are either very indecisive or very thorough in your research...lol

I was hoping no one would notice....trust me, I'm a geek, lots of research whenever I buy anything....it just took me 6 weeks to buy a TV. I exhaust every possible piece of research I can find before making a purchase.

The lease vs. buy debate is always a fun one....I like the lease options sometimes....other times I think the buy route is the best. I was just confused on why the double cab leases so well and the crew cab they kill you on. If I'm paying a lease payment that is close to a buy payment, its a no brainer, but the lease route can be nice when they run specials on some of the nicer trucks. There is one dealer I saw in michigan running a $397 a month lease on a denali crew cab, no way you are getting into a crew cab on a purchase close to that price, and at the end of 3 years if you want to buy the truck there is a good chance the purchase price is cheaper than any 3 year old truck you will find for sale and you know the history of the truck, if not you hope to be sitting in a good spot to purchase new/used or lease again. I like the comfort of knowing when i lease my trucks are basically always under warranty.

mxzeatr · April 21, 2017

If the used market stays the same for 3yrs due to our incentives etc our buyout is 25,580. That's cheaper then I can get a 3yr old truck with 36k on off any lot right now, so why not lease. We won't buy this truck anyway, but for 230 a month, why not drive a brand new truck. With leasing your basically buying the depreciation that you use of the truck. If the "sale price" is low on a high MSRP like ours was (incentives etc) took our MSRP of 48k to around 36k, it puts us in a good spot. I may "buy" the truck and sell it prior to the lease ending if the market stays similar in the next 3yrs, I'll put a few k in our pockets and step into another one...

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