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Lease is killer on 9-3 Linear/Arc....tax savings... Posted by Mike Lynch [Email]  (#81) [Profile/Gallery]
(more from Mike Lynch) on Sat, 18 Jun 2005 12:41:38
In Reply to: MIke...Lease question, Sam, Sat, 18 Jun 2005 06:16:43 Members do not see ads below this line. - Help Keep This Site Online - Signup |
Let me add it up a different way. 23 remaining payments of $226 = $5,198, plus the $2,999 which is not really down, but "due at signinge" and includes the 1st payment and acquistion fee ($226+$595+$2,178=$2,999) so only $2,178 is down payment/cap reduction, anyway add the whole $2,999 and the buyout of $15,715 = $23,912
So lemme' see that's a total 24 mos 12,000 mile cost of $23,912, if you buy the car, for a $27,570 list price Saab.
You're asking what part of the lease charges don't go directly to depreciation and while that's not an invalid way to do it it doesn't really reflect the additional carrying balance of a lease. That is a 24 mos finance agreement would pay down to zero, a lease pays from the cap down to the resdiual, but the entire residual is carried for the whole term, means more money is out there to earn lease charges. That's the trade off for the money you don't put into a lease in lower payments, the 24 mos purhcase payment is around $1,000 a month.
You also have to look at the bigger picture. By leasing in some states, 'cause I just spoke with a buy from Chicago and in Illinois they charge state sales tax on the cap cost, but here in California there's only tax on the payment, about a $1,000 savings over 2 years, if you don't buy the car.
The decent, but not absurdly low lease rate, the extra $1,000 incentive, and the intrinsic advantages of leasing make owning a Saab 9-3 on the long term worthy of leasing it for the first couple of years for the economic advantages. Now it's not big money but the couple of thousand you save by leasing the first 2 or 3 years can make sense.
, Sat, 18 Jun 2005 12:41:38 <-- Viewing This Message
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