Rubicon DEAL...Buy or Lease ????

[sobeit69]

Ok 2019 JLUR
Finally a local dealer....is willing to deal
57,800 MSRP

Dealer knocked off $6900 with tread lighlty.

So 51,173 is sale price

Lease I can get is 575x42 w $1600 down....
549x42 w $2600 down
523x42 w $3600 down
Residual is $36,400

Or I will just finance with Credit union at 2.24% x60

what do ya think...lease or finance????

any help is appreciated

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[shane h.]

Do you keep your cars for years? Or do you regularly trade?
Keep = buy
Trade = lease

 

[Jrbrannan]

Ok 2019 JLUR
Finally a local dealer....is willing to deal
57,800 MSRP

Dealer knocked off $6900 with tread lighlty.

So 51,173 is sale price

Lease I can get is 575x42 w $1600 down....
549x42 w $2600 down
523x42 w $3600 down
Residual is $36,400

Or I will just finance with Credit union at 2.24% x60

what do ya think...lease or finance????

any help is appreciated

At the end of the lease you will have paid $25,750 and you will turn in the Jeep and have nothing. If you go over mileage or damage the vehicle it will cost you more. The advantage is that you have lower payments.

If you were to finance it over the same period you would pay about $900 a month. So over that same 42 month period you would pay about $37,800 (about $12,050 more than a lease) but you would still have the Jeep. You would still owe about $16,000 on your loan. Now assume the Jeep is actually worth the $36,400 residual then you would have around $20,400 in equity in the Jeep.

So you when you consider the higher payment for the purchase but also consider the equity that you have in the Jeep after 42 months you would be on the plus side of $8,000 by buying over leasing.

This is why IMO leasing is almost never a good idea-

 

[ThirtyOne]

At the end of the lease you will have paid $25,750 and you will turn in the Jeep and have nothing. If you go over mileage or damage the vehicle it will cost you more. The advantage is that you have lower payments.

If you were to finance it over the same period you would pay about $900 a month. So over that same 42 month period you would pay about $37,800 (about $12,050 more than a lease) but you would still have the Jeep. You would still owe about $16,000 on your loan. Now assume the Jeep is actually worth the $36,400 residual then you would have around $20,400 in equity in the Jeep.

So you when you consider the higher payment for the purchase but also consider the equity that you have in the Jeep after 42 months you would be on the plus side of $8,000 by buying over leasing.

This is why IMO leasing is almost never a good idea-

That's true but a little oversimplified. You have to do a Net Present Value on the $12,050 which would reduce the gap somewhat. Also while you are way ahead on a loan after 3 years, the equation changes as you get further out. If you lease another vehicle at a similar rate versus continuing to pay on the loan, the maintenance and depreciation on the loan starts to get more expensive and closes the gap further. Once you pay off the vehicle then you get ahead again. That is why it is relevant how many miles you drive and how many years you generally keep a vehicle.

 

[lonz]

At the end of the lease you will have paid $25,750 and you will turn in the Jeep and have nothing. If you go over mileage or damage the vehicle it will cost you more. The advantage is that you have lower payments.

If you were to finance it over the same period you would pay about $900 a month. So over that same 42 month period you would pay about $37,800 (about $12,050 more than a lease) but you would still have the Jeep. You would still owe about $16,000 on your loan. Now assume the Jeep is actually worth the $36,400 residual then you would have around $20,400 in equity in the Jeep.

So you when you consider the higher payment for the purchase but also consider the equity that you have in the Jeep after 42 months you would be on the plus side of $8,000 by buying over leasing.

This is why IMO leasing is almost never a good idea-

Completely agree! For some vehicles, leasing makes sense, but definitely NOT for Wranglers. They hold their value too well to lease them. As your math correctly shows above, you'd be far better off (in the long run) to buy the Wrangler.

 

[Jrbrannan]

That's true but a little oversimplified. You have to do a Net Present Value on the $12,050 which would reduce the gap somewhat. Also while you are way ahead on a loan after 3 years, the equation changes as you get further out. If you lease another vehicle at a similar rate versus continuing to pay on the loan, the maintenance and depreciation on the loan starts to get more expensive and closes the gap further. Once you pay off the vehicle then you get ahead again. That is why it is relevant how many miles you drive and how many years you generally keep a vehicle.

You are right about making it over simplified- I did not want to get into the NPV and confuse people.

It is actually the NPV of $325 a month for 41 months, then 40 months, 39, etc. So it is not the NPV of $12,500. Considering the abysmal rates of savings accounts the NPV of those extra payments are minimal.

There is a higher maintenance costs of a 4 year old vehicle over a new one but the highest total cost of ownership of any vehicle is the first two years (mostly because of deprecation) so IMO your thought on leasing another car at a similar rate loses weight, it actually increases the gap.

But regardless most financial experts will tell you to only buy cars with cash and never lease. They are a depreciating asset- never extend yourself with debt to buy a depreciating asset.

 

[sobeit69]

At the end of the lease you will have paid $25,750 and you will turn in the Jeep and have nothing. If you go over mileage or damage the vehicle it will cost you more. The advantage is that you have lower payments.

If you were to finance it over the same period you would pay about $900 a month. So over that same 42 month period you would pay about $37,800 (about $12,050 more than a lease) but you would still have the Jeep. You would still owe about $16,000 on your loan. Now assume the Jeep is actually worth the $36,400 residual then you would have around $20,400 in equity in the Jeep.

So you when you consider the higher payment for the purchase but also consider the equity that you have in the Jeep after 42 months you would be on the plus side of $8,000 by buying over leasing.

This is why IMO leasing is almost never a good idea-

So if i finance for 60 months at 2.24 % thats cheap money now a days. My bank is giving 2% interest on whatever is in my account. So Essentially my loan is costing me .24 % for 60 months.
The lease every time I run the numbers seems to cost me over 3k more. And that’s comparing it to the original 2.24%

Others say lease is good because Jeep just hasn’t ironed out all the issues yet. This has a build date of 2/18/19

Hmmm

 

[Jrbrannan]

So if i finance for 60 months at 2.24 % thats cheap money now a days. My bank is giving 2% interest on whatever is in my account. So Essentially my loan is costing me .24 % for 60 months.
The lease every time I run the numbers seems to cost me over 3k more. And that’s comparing it to the original 2.24%

Others say lease is good because Jeep just hasn’t ironed out all the issues yet. This has a build date of 2/18/19

Hmmm

Well if Jeep is right about the residual value then you would have around $20k in positive equity in the Jeep after the 42 months- so if things are not ironed out then you could sell it. Furthermore if you buy the Jeep you have many more options if it is something you did not like- you could sell it outright after 2 years. Getting someone to take over a lease after a couple years can be a real headache.

 

[sobeit69]

Do you keep your cars for years? Or do you regularly trade?
Keep = buy
Trade = lease

Well we sold our two JKs to get this one Rubicon. My health kinda sucks so taking even the t-tops off is a huge chore. That’s why this one has a Sky One top.
The over all goal is to keep her.....but with jeeps unpredictability these first two years has got us wondering....a lease is a easy way out....right?

 

[ChrispyJL]

I leased my 18 JLU because I do not plan on keeping it longer than my term.
I didn't have a ton of money for a down payment, and a $700-900 car payment is way out of the question at this time in my life.
At the end of my lease, I will be in a better financial position to finance.
Also I needed 4 doors for a few years because my kids are in a car seat and a booster.
When My lease is up, my daughter will be out of a booster and my son will be in a booster, so a 2dr will work for me and I will finance a 2dr then.

Also by 2021/22 who knows what wranglers will be, but hopefully it doesn't come from the factory with bugs, death wobble, bad welds and electronic gremlins.

Sometimes it is just better to lease, it really depends on your situation.
Obviously if you can afford the payment or have a shit ton to put down it makes sense to buy.
Personally I would not lease a Rubicon, lease a sport s if you have to lease.

Do what makes more sense for you, it is not a decision anyone here can make for you.

 

[YYCSahara]

Completely agree! For some vehicles, leasing makes sense, but definitely NOT for Wranglers. They hold their value too well to lease them. As your math correctly shows above, you'd be far better off (in the long run) to buy the Wrangler.

Vehicles that hold their value well as exactly the perfect ones to lease. I leased my Sahara because the residual is so high. Otherwise I wouldn't consider it. I am paying $510 Canadian with 0 down for 39 months. In Canada that's on par with what a 4 cylinder Camry or a mid level CRV would lease for. They are a huge bargain to lease. I do switch cars every few years so buying them or financing them would make it a lot harder to get rid of them and not lose much more money in the process.

I could pay cash for it, but would rather not have all that money tied up in a vehicle when I can put it to work for me elsewhere. But, yes if you know you want to keep it for long term, leasing may not be the best.

 

[piloto]

Mind naming the CU that's offering 2.24% financing for 60 months? Thanks.

 

[sobeit69]

Mind naming the CU that's offering 2.24% financing for 60 months? Thanks.

https://www.bcu.org/rates?tab=2

 

[sobeit69]

I leased my 18 JLU because I do not plan on keeping it longer than my term.
I didn't have a ton of money for a down payment, and a $700-900 car payment is way out of the question at this time in my life.
At the end of my lease, I will be in a better financial position to finance.
Also I needed 4 doors for a few years because my kids are in a car seat and a booster.
When My lease is up, my daughter will be out of a booster and my son will be in a booster, so a 2dr will work for me and I will finance a 2dr then.

Also by 2021/22 who knows what wranglers will be, but hopefully it doesn't come from the factory with bugs, death wobble, bad welds and electronic gremlins.

Sometimes it is just better to lease, it really depends on your situation.
Obviously if you can afford the payment or have a shit ton to put down it makes sense to buy.
Personally I would not lease a Rubicon, lease a sport s if you have to lease.

Do what makes more sense for you, it is not a decision anyone here can make for you.

While the $970 x 60 is ok. It looks much nicer in my head at $575. Haha.
But i just ran numbers a bunch of ways...and if we lease for 42 months than finance the $36,000 residual at the end assuming 2.24% interest for say another 48 months. I will end up paying $8000 extra in interest and fees.....
I think...haha...ugh.

Taxes are 7% in IL . But you only pay tax on lease amount up front. Than you have to pay tax on the 36k amount when you buy it at end of lease. But my math still comes out to $66k 90 months ..ouch
If I just finance the $55k for 60 months.......................................... I’m at $58,500 for 60 months

 

[ChrispyJL]

Yeah, if you plan to buy it out, a lease is always a bad idea.
I would never buy out a lease.
I got a great lease deal, and did the math, it wouldn't be wise to buy it out, even with the great lease I would be paying a few thousand over MSRP.

Certainly go with the finance if you financially able to, and plan to keep it

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