Hi all! Mouth vomit incoming!
I’ve been a lurker for a few years off and on, which turned us on to leasing a CX5 Touring w/tech package FWD 3 years ago when we resided in FL. Now we are in a pickle, as the deal when in FL now is an inconvenience as the lease matures in this market in February. Original deal was a 3/36 with 3400 trade in for 290/mo.
SUV currently has 19k on it so we are well under utilizing the mileage. Carfax estimate trade in is 23400.
We returned to the DMV and see inclement weather, so I will preface this by saying IF our lease was an AWD CX5 we would be buying out the lease for the RV of 16,790. Given values it would be a no brainer to avoid entering the market. Financials to noted, as FL is a tax per use state, we paid tax per monthly payment, and when returning to MD we gave the state a lump sum of the remaining sales tax on the original purchase price of the vehicle. This dropped our payment to 275/mo. No tax will be assessed on a buyout, and we can also use that sales tax as a credit against the value of a new purchase or lease.
Currently adjusted monthly being 275. If we buyout we can finance at a local CU for 1.74%, effectively keeping our monthly with little interest earned if financed for 60mo.
However this leads us to the below scenario:
Do we take the “earned” money in the CX5 and dump the entire residual equity into a new lease. We love the CX5, but most likely will get rid of the car within 3 years if we bought it out to begin with as we would have had it for 6 years at that point.
Current leasing offers from MazdaUSA imply that I could take the roughly 6k in the equity and put that towards a new uptrimmed 2023 CX5 Premium Plus AWD. Assuming I can get MSRP 35,575.00 36/10 with the equity down of 6k would net a rough 295/mo lease.
Finance through the CU or take this money I am spending 16k over the best 3 years or 17k over 5, potentially offloading the purchased car in 3 years anyways.
Am I wrong is seeing this as I have money to play with that is on the house currently? Is the lease plan sound, or am I missing something?
Thanks in advance!
The pandemic and subsequent events changed so many peoples’ net worth in so many unforeseeable ways: ups and downs in home equity, stocks, bonds, cars, raises/layoffs/promotions, etc.
None of that is “house money.” Money is money.
The people who adopt this approach are the same people who’d win the lotto and be bankrupt within a few years.
Understandable - however I that is not my situation and the only funds we are focusing on are the value of the CX5 lease in question.
If I buy out our current vehicle I am forgoing the current equity, losing a warranty, and paying MSRP from 2019 if I pay the loan to term. If I buy or lease now a new car I am “selling high and buying high”. If I aquire a deal at MSRP today I am utilizing the equity against the owner, CHASE MAZDA financial.
This isn’t the lottery and it isn’t betting so I am looking for why I should not dump the equity into the other lease with the above thoughts. I plan to use no additional funds besides the value of the lease, whether the market allowed for us to have a high equity against the lease value, or if we had no lease value.
If you’re in Metro DC or Metro Baltimore, the amount of times you need AWD during the winter can be counted on one hand. I’ve lived in the DMV for over 20 years and never had an issue driving with a FWD vehicle. I would consider buying out your vehicle and investing in a set of snow tires.
We are also MD natives, I would be fine with getting a pair of snow tires but the SO is less confident driving and would prefer the AWD as insurance. I do also commute from central to western MD, so the cutoff of snow or ice can be nothing by the bay but 7-10 where I work.
Which CU gives you 1.74% finance rate?
Tower. Although reviewing looks like they updated rates per the latest hike, I would now be looking at 2.49-2.99.
Incremental difference but the payment remains marginally unchanged.
2.99% will cost about 75% more interest over the term compared to 1.74%.
Yes, about 400 dollars more over the term.
I can still view this as cost of ownership between both vehicle choices between 3 years is similar, but the 2023 would obviously carry the warranty and AWD / more features?
Obviously if we Dave Ramsey the situation it would be buy out the car and never buy again but this is a leasing forum…lol.