Lease vs. Purchase, Never leased before. HELP

[miweber929]

They're right, this is a very, very expensive sport model and you should start there for sure
This is easily Willys Extreme Recon territory at this price which anyone would want more than this, the crap this dealership picked out.... let him get stuck with it

Not sure why the hate on a nicely equipped Sport S. Mine is almost exactly the same spec as the one listed above and I love it: not everyone wants to bounce down the road, listening to wailing tires howl, have big ballon wheels and a need to be the biggest, baddest mall crawler at Starbucks to compensate for inadequacies.

A Sport S is a VERY capable hunting, fishing and off-road vehicle as it sits, they have nothing to prove to anyone.

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[TheNewGuy]

Not sure why the hate on a nicely equipped Sport S. Mine is almost exactly the same spec as the one listed above and I love it: not everyone wants to bounce down the road, listening to wailing tires howl, have big ballon wheels and a need to be the biggest, baddest mall crawler at Starbucks to compensate for inadequacies.

A Sport S is a VERY capable hunting, fishing and off-road vehicle as it sits, they have nothing to prove to anyone.

THIS!

 

[blueweb]

There is a lot that goes into a lease and the picture does not show the full picture. But what I can say is that you should triple-check and make sure how many miles a year you are planning on driving. The lower the miles, the higher the residual value (higher is better). Also, I would not do 4 years, because the standard "bumper to bumper" factory warranty expires after 3 years, so if anything breaks during the 4th year of the lease, it will come out of your pocket. Additionally, If you possibly can, I would do a single pay lease, compared to the month-to-month. Doing a single-pay lease should cut your money factor (APR on the lease) by half.

The best thing to do before leasing/buying a vehicle is to see what you are going to do with the vehicle when it finally is time after the 3/4 (or the 7 if you financed) years are up. For example, after the lease is over with, what are your plans? After a lease is about to expire, you can either: buy your current leased vehicle, sell it, just return the vehicle, or lease another vehicle. Typically people will want to sell the leased vehicle for positive equity, if that is the case, then it doesn't matter how many miles are on the vehicle or not. So bumping the time of the lease and mileage to 15,000 will just be a waste of money down the drain if you were to sell this said vehicle after the lease is complete. If you financed, do you really want to be paying 4.24% in interest for the next 7 years?

I hope any of this makes sense. Honestly, look at your finances and the times we are in currently. No one can predict what is going to happen in the next couple of years. You may want to keep this vehicle long-term or maybe the next-gen of Wrangler will come out, and you would want that instead. Last thing. I would take my trade-in vehicle to CarMax, Vroom, Carvana, etc to see if I can get a high value out of my used vehicle than at a dealership, and then bring that price to the Jeep dealership to see if they can give me more for my trade-in.

 

[laroo]

Not sure why the hate on a nicely equipped Sport S. Mine is almost exactly the same spec as the one listed above and I love it: not everyone wants to bounce down the road, listening to wailing tires howl, have big ballon wheels and a need to be the biggest, baddest mall crawler at Starbucks to compensate for inadequacies.

A Sport S is a VERY capable hunting, fishing and off-road vehicle as it sits, they have nothing to prove to anyone.

Nothing wrong with a Sport S. I had plans to replace my 19 Sport S with a 22 Sport S or Willys. But once I optioned mine out, it was very close to the price of the 4xe Rubicon that I eventually ordered, at least with the $7500 tax credit applied. When I was looking at all the models, it was sometimes better value to get the Sahara or Rubicon model with more standard features.

I also priced out my exact 19 Sport S in 22 prices, and the price increase was $5k, 2019 was $43k MSRP, 2022 was $48k MSRP. If I hadn't gone with the 4xe, the Sahara probably would have been the better value.

 

[The Last Cowboy]

A Sport S can be very highly optioned. They really need to rename the package. Resale is based off the original MSRP and not simply the package. A friend of mine is looking at one that has a bunch of packages including Tech, Cold Weather and Mopar leather. He wants a 2 door, so a Sahara is not an option. I was shocked at how many options were on the sticker, and that dealer has 3 equipped the same way.

 

[The Last Cowboy]

To touch on what @blueweb said, if you are choosing between a lease that barely fits your budget, or 7 year financing (7 years!) , just keep what you have. I hope you didn't do 7 years in that too.

Right now my credit union does 1.95% out to 72 months, which I'm surprised by as the best rates used to cutoff at 66 months.

Anyway, $40k at 1.95% for 6 years (72 months) is 589.26. At the rate you were given, you pay almost as much for another year just to pay interest.

 

[Pinky Tuscadero]

Not sure why the hate on a nicely equipped Sport S. Mine is almost exactly the same spec as the one listed above and I love it: not everyone wants to bounce down the road, listening to wailing tires howl, have big ballon wheels and a need to be the biggest, baddest mall crawler at Starbucks to compensate for inadequacies.

A Sport S is a VERY capable hunting, fishing and off-road vehicle as it sits, they have nothing to prove to anyone.

The question was the price of $49,000 for a Sport, no one was bashing a Sport and if you actually read this you would have seen the advice was to buy a Sport with options more in line with such vehicle instead of buying a Sport and paying for something more.
Now I'll just go back to the Starbucks outside the mall and sip my Frapachino with my therapist to work on my inadequacies which are plentiful indeed.

 

[four low]

A 6 or 7 year loan , IF IT LOWERS YOUR MONTHLY PAYMENT to a point you can pay off principal ahead of time, is a good idea. It gives you room if hard times hit , and lets you pay off early when you have extra cash.

 

[Some Random Guy]

A 6 or 7 year loan , IF IT LOWERS YOUR MONTHLY PAYMENT to a point you can pay off principal ahead of time, is a good idea. It gives you room if hard times hit , and lets you pay off early when you have extra cash.

This is a good strategy, numbers wise.

Some of us don’t recommend it because of the poor success rate of undisciplined “normal” people. If someone’s budget is in a place where they might need the extra $200/month, it is an indicator (NOT definitive predictor) that they need to decrease debt, increase savings, or find ways to increase income. If that’s the case, a new car is probably a bad idea.

NOW, if someone is doing it because their budget supports the extra principal payments most months while ALSO meeting other savings goals this is a good strategy. Then you can drop the extra payment if an emergency comes up to keep your other investment contributions going.

Sorry for the hijack, just adding extra decision info for others.

 

[mllcb42]

Also, I would not do 4 years

It's worth looking at the actual costs. On the non-4xe wranglers, the money factor on a 48 month lease is much lower than a 36 month lease through ccap, for example. You should always evaluate the different lease periods to try to find the sweet spot (which from a lease cost standpoint alone is 48 months on non-4xes, 36 months on 4xes currently). From there, it's about mitigating the warranty risks to an acceptable level and factoring that potential cost in.

 

[Hennessey17]

Serious question...

With the resale values of Wranglers what they are... why would you ever lease one?

I'm not being obtuse. When I was looking last summer, I asked my father, who's an accountant... and he said buying was a no-brainer.

I'm curious about the reasoning of leasing.

 

[TheRaven]

Right now my credit union does 1.95% out to 72 months, which I'm surprised by as the best rates used to cutoff at 66 months.

So over the last year or so i've been realizing that these long-held "rules of thumb" need to change to meet today's realities. We are watching MSRP's go up $3-5k a year now. I know it sounds tired to say because we've been saying it for so long, but now we're getting into extreme territory - vehicles are getting EXPENSIVE. Mid-trim econoboxes are pushing $40g's and Mid-sizers are routinely crossing the $50k line. A very standard 72-month loan on a compact CUV is over $600/month at this point...that's not money that the majority of compact CUV buyers can afford. We are going to start to see a major shift in vehicle financing...a lot more leasing and much longer term loans. Something has to give because as always, salaries are not keeping pace with costs.

At this point i'd say there's nothing wrong with 72-month and even 84-month loans. My credit union gives top rates on everything up through 72-months last I checked. I would have never thought that 10 years ago but the average middle-trim econobox MSRP has gone up over 20% in that time!

 

[miweber929]

The question was the price of $49,000 for a Sport, no one was bashing a Sport and if you actually read this you would have seen the advice was to buy a Sport with options more in line with such vehicle instead of buying a Sport and paying for something more.

I did read what you wrote and a Willys XR (plus the Rubicon, Altitude and even the Sahara) is not a "step up" from the Sport S unless you will use what they come with. You literally said anyone would want that Willys XR more than a well equipped S and that the dealer should be "stuck" with it. That's just not true for everyone.

I have no plans on rock climbing, so no need for a locker, the 35" mud tires on the XR is not a better ride on the road than the AS or AT's on the S, I don't want 20" rims, I hate the red dash, I don't like leather seats and I don't like the grille accents on the Sahara. A Sport S with a great radio, heated seats, a tow package and LED lights is a "better" buy for me than any of the other trims because of what I plan to use it for.

No harm meant, just saying telling someone to buy a 1 ton pickup when they are looking to haul a 5x8 garden trailer once a year and spend the rest of the time on the highway is not really great advice.

 

[Some Random Guy]

So over the last year or so i've been realizing that these long-held "rules of thumb" need to change to meet today's realities. We are watching MSRP's go up $3-5k a year now. I know it sounds tired to say because we've been saying it for so long, but now we're getting into extreme territory - vehicles are getting EXPENSIVE. Mid-trim econoboxes are pushing $40g's and Mid-sizers are routinely crossing the $50k line. A very standard 72-month loan on a compact CUV is over $600/month at this point...that's not money that the majority of compact CUV buyers can afford. We are going to start to see a major shift in vehicle financing...a lot more leasing and much longer term loans. Something has to give because as always, salaries are not keeping pace with costs.

At this point i'd say there's nothing wrong with 72-month and even 84-month loans. My credit union gives top rates on everything up through 72-months last I checked. I would have never thought that 10 years ago but the average middle-trim econobox MSRP has gone up over 20% in that time!

It’s less about affordability of payments and more about making sure the loan is not underwater at crucial times. A 7 year loan can leave a hypothetical buyer underwater when the warranty runs out. Imagine being $5k under and having major issues not under warranty anymore.
Being underwater for 3-4 years on that long of a loan also means a buyer is stuck with that vehicle. If they have a kid or need to change jobs to a longer commute, they’d be stuck with a vehicle that doesn’t work for them anymore. That’s the real trouble.
All numbers are made up, a more knowledgeable person might correct them.

 

[The Last Cowboy]

So over the last year or so i've been realizing that these long-held "rules of thumb" need to change to meet today's realities. We are watching MSRP's go up $3-5k a year now. I know it sounds tired to say because we've been saying it for so long, but now we're getting into extreme territory - vehicles are getting EXPENSIVE. Mid-trim econoboxes are pushing $40g's and Mid-sizers are routinely crossing the $50k line. A very standard 72-month loan on a compact CUV is over $600/month at this point...that's not money that the majority of compact CUV buyers can afford. We are going to start to see a major shift in vehicle financing...a lot more leasing and much longer term loans. Something has to give because as always, salaries are not keeping pace with costs.

At this point i'd say there's nothing wrong with 72-month and even 84-month loans. My credit union gives top rates on everything up through 72-months last I checked. I would have never thought that 10 years ago but the average middle-trim econobox MSRP has gone up over 20% in that time!

Also, the manufacturers need to come out with some de contented models. Not every vehicle has to have the level of options they do at the base level. A Wrangler for instance with vinyl seats, and only a rubber floor, base or no radio ( all you really need is a good Bluetooth speaker), rear seat delete option.

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