Advice on new lease - ride out or buy?

Ask the Hackrs Buy/Finance
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So, first time car buyer here and unfortunately I didn’t stumble across this community soon enough. I did plenty of research before starting a lease but made some mistakes and am looking for advice on the best path forward.

On Nov 23rd I traded in my Volvo Cares subscription (that I had for 5 months) after the S60 T8 Ultimate I ordered came in. I went with the subscription as I recently moved, didn’t have a car, and would get good rebates when rolling over the lease making it a fair price in my opinion.

I think I did an okay job negotiating originally but two things didn’t go my way (and it’s my fault for not handling it better, learning experience for me). One, even tho I said no 10 times I ended up caving and getting wheel/tire and 3,000 repair insurance for $25/month. At the time, I said okay because honestly he wore me out and when I asked if the lease ended early if I’d still be responsible for payments, he said no, so I figured if I bought the car a few months after lease started I’d not have to worry about it. The second thing was they added this “ceramic and protective coating” crap to the car I ordered without asking and insisted they couldn’t take it off and there was nothing they could do about it but it didn’t increase my payment so I shouldn’t care. I was nieve and only now I’m realizing that it increased the price of the car which will impact my buyout plan I believe.

The last piece of information I’d like to add is currently they’re in the process of backing out and re-booking the deal because they forgot to include the Costco $1,000 rebate and after a lot of back and forth they finally agreed to rectify that, I’ve not yet signed any of the revised paperwork.

So my question is, what’s the most financially savvy decision? Ride out the lease and trade in at 2.5 years (my dream car is a V60 recharge), or buy it and hold on to it for 3-4 years and then sell? My plan was to lease so I could get the 8,000 in EV credit and then buy cash but my buyout number is higher than anticipated! I think I did a decent job with all the rebate stacking at least… Here are some numbers:

Volvo S60 T8 Recharge
MSRP $57,400
TSRP: $59,845 (climate + protection package, destination charge)

Monthly Payment: 675
Down payment: 4,980 (taxes and fees)

Vehicle Only Cap Cost: 56,042
Gross Cap Cost: 61,274 (did I get screwed here?)
Cap Cost Reduction: 10,892 (not including the 1,000 Costco credit they’re fixing)
Adjusted Cap Cost: 50,381
Residual Value: 32,316
Depreciation: 18,065
Rent: 6,252

Extras that I think were my big mess up:
INT/EXT PROTECT: 1,338
ROAD HAZARD: 1,649
VEHICLE PROTECTION: 1,250

Lease Buyout Currently: 54,583

Thanks in advance for any guidance, be kind, it’s my first car purchase, I still have a lot to learn!

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Return the car, if you haven’t signed, then they can take the car back.

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What does this term mean?

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This deal looks awful, what was the sales price before all the add on BS? If you need to resign I’d insist they take off all that crap, I have I feeling you’re screwed though because if they add Costco and have you resign, they’ll just say they can’t take off the add on BS. Or they’ll just cut you a check for $1000 and eat that on the deal, I assume they made allot of money on your deal. You haven’t really broken down the sales price/incentives/MF/DAS :speedboat:

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You think it’s bad enough I should return it? I do need a car and it’s my only one.

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Total Suggested Retail Price. It was on the window sticker so I included it.

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Sales Price Before: 56,042
Sales Price After: 61,274

Incentives:
7,500 Federal EV Credit
500 State EV Credit
1,000 Loyalty
1,000 Thanksgiving
1,000 Costco

MF: 0.00292

Sorry, what’s DAS? I really appreciate the help. Trying to understand where I went wrong and how bad it is :frowning:

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I don’t think anyone on LH would take an S60 for an effective $800 per month

Well this plan isn’t a financially savvy plan to save towards your dream car. NTM wagons are unfortunately on the chopping block in the US market so your ability to buy a brand new one in the future is very unclear, at best. Or to even buy a late model used one for a nice discount.

Your best options are to buy a V60 Re now, or if the ~$14k delta is too much then buy a cheaper car now to save faster. Don’t waste time and money with an S60 in the meantime.

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Due at signing. “Down payment” is often use interchangeably w/ DAS, although they actually mean diff things.

There’s a West Coast broker offering a similar MSRP S60 PHEV for slightly more than $100 less per month w/ only first month due at signing (and presumably a broker fee). Your deal is absolutely awful.

“TSRP” is a bogus term. The dealer is marking the car up by $2.5K. And then they added $4K of BS. So your actual discount is much less than what you think it is.

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Or the OP may have misunderstood top line (base) MSRP on the sticker and the total (with options) on the bottom.

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Thanks for the frank feedback, I appreciate it.

Do you say effective price because of the taxes and fees?

Would me buying it and as a result saving ~7,500 in interest salvage the deal?

I’m not sure what my options are now that I’ve had the car for two weeks. I do like the car, it’s just the deal now. I could afford the wagon but it felt excessive to spend that much and it was a 11 month wait instead of 4. Maybe that was my real fuck up…

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Thanks!! In that case the DAS was 4,980 in taxes and fees but I guess technically the 10,000 in incentives was considered part of the down payment too?

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Yes, the TSRP as per the window sticker was just after adding the climate package, protection package, and destination fee.

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It’s all the money leaving your pocket. ($675*35 + DAS) / 36

Your lease balance is way too high to salvage this deal.

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That’s just MSRP.

The arbitrary distinction between before/after options is completely meaningless.

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Thanks again. So even tho it’s a bad deal it’s better to ride it out then to try to purchase? If return it but idk if that’s even possible at this point, I assume not…

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Understood, thanks.

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Doesn’t it need a new contract that you’d need to sign?

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If you don’t mind could you help me understand what parts of the deal are bad? Is it just the three line items that were added to capitalized cost or are there other aspects of the deal I messed up on?

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Yeah, so, they had to backout the deal with the bank and said they are going to send me a revised deal via DocuSign. Do you think this is a legitimate opportunity to try to fix it that has a chance of being successful? What would you do in my shoes that you’d never end up in because you knew better :joy: