Lease a Prius?

I live in Northern California and I just leased an 07 Prius for 36 mos. There was an option for 24 as well. So far I LOVE the car.





<div class='quotetop'>QUOTE(cjhinpa @ Mar 6 2007, 02:14 PM) [snapback]401031[/snapback]</div>

 

As I recall--My father did most of the money talk--- If you have excellent credit the "money factor" was I believe .00099 Im not perfect so I qualified in to the 2nd tier--which was like a 17 dollar a month difference. This was for the 36 month I did not inquire about the 24 month.

I went in thinking I could afford a Matrix, but then realized with the lease special the Prius was going to be about the same price. Of course after I drove the Prius I HAD to have this and that so it is a bit more than the Matrix, but worth it. It is package four, and I put 2g down and my payment is 323 including Gap Insurance. Hope this helps!


<div class='quotetop'>QUOTE(cjhinpa @ Mar 6 2007, 05:16 PM) [snapback]401214[/snapback]</div>

 

Keep in mind that you're not eligible for the $1575 tax CREDIT that's expiring at the end of this month if you lease instead of buy. This credit is money that the federal government will give you back from your taxes. It's not simply a deduction. Also, Toyota's doing financing at 2.9% for 3, 4, or 5 years!

Personally, I am not a leaser. Take my last car (2005 Corolla) for example, which I kept for 2.5 years (about the same you're thinking you may keep the Prius).

Bought August 2004 for $14,000
Put $2,000 down (trade-in)
Payments were $229/mo/5 years
At the time lease was more $$/mo than my payments, so it was a no-brainer
When I traded it in, I got $10,500 for it and only owed $6,800
Therefore, I had $3,700 in equity
Also, the entire $10,500 was deducted from the price of my Prius when considered for sales tax. This saved me $1,000 in sales tax.

If I had leased the car, I would not have any equity towards the new car... I would not have had the sales tax break... I would have been charged if I went over the allotted miles... I would have been charged for every little ding on the car...

I am planning on keeping my Prius for a minimum of 7 years. I figure that even when the new model comes out, this car will still be way ahead of the norm as far as technology when compared to other cars. chose the 4 year loan, and am looking forward to the point of not having any more car payments! Also, I'm guessing that the new model of Prius will be ~30k, and I won't be ready to shell out that kind of cash for a long time.

Most likely, if you buy a Prius it will be worth more than you owe on it at the end of 2 years. If you do decide to get the new model, you can use the 07 Prius as a trade in, which you can't do if you lease it.

Just some food for thought. Keep us updated on your decision!

 

Why rent a car for years?

 

<div class='quotetop'>QUOTE(Rest @ Mar 7 2007, 02:08 AM) [snapback]401515[/snapback]</div>

Actually, I recently leased an 07 pkg 5 Prius and I compared the lease deal to the financing deal at 4.9% 60 mths (because monthly payment was my primary concern) and if I want to drop the car in 3 yrs and get the next gen Prius the lease was hands down a better deal based on total money out of pocket (about 3-4k less on lease vs. loan) after 3 yrs and if I want to buy the car the lease deal was still a better deal by like $500 based on how much I would owe on the loan after 3 yrs vs. the buyout on the lease after 3 yrs.

It is always important to financially compare the two side-by-side before making a decision. Of course, not all people totally understand leases and get confused by the calculations so that can be a problem at negotiation time. Some leases are total crap and not worth it at all and some are - caveat emptor!

 

<div class='quotetop'>QUOTE(cminshall @ Mar 7 2007, 06:50 AM) [snapback]401573[/snapback]</div>

You fail to account for the equity you would have in the car if you had purchased it and made those payments. On some cars, the depreciation is significant and not much equity is built up, but Prii hold their value so well that the equity gain is significant. That easily makes up for the increased cash out of pocket.

Of course it all depends on terms, cash flow, etc, but the Prius is widely considered one of the least expensive cars to buy, and in my case when I compared the numbers for lease vs purchase, it seemd like a no brainer to purchase, even if I sold it in two years. Mainly because they hold their value so well. Oh, and the new 2.9% for 60 mos didn't hurt either.