I have already seen some veterans here say Subarus typically don’t lease well, but here I am. I herniated my L4-L5 pretty badly almost a year ago and after trying 10+ SUV’s, I am able to sit in this one without 4 support cushions.
I am including an itemized breakdown of the financing offer for this vehicle as well as the leasing numbers they emailed me. This is all I have to go on for now.
Numbers they gave me for leasing:
36mo/ 10k miles / year
$459/mo
$2551.66 (total out of pocket taxes and fees)
Money Factor:.00267
Residual : 65%
Aquisition fee:$595
Dispo fee: $395 will be charged at the end if you decide not to lease another Subaru.
According to Edmunds, my MF should be .00217, Residual is the same.
I am on a tight time table due to some extenuating circumstances. If anyone can please tell me which is a worse deal I’d really appreciate it.
I am not really planning to keep this forever. Ideally, I would want to drive this for 1 or 2 years and then see what else is out there depending on my finances, what new cars come out, the market, etc.
I used the VIP program to get the invoice pricing on this in case anyone was curious.
Thank you, I was kind of thinking the same thing but I was not 100% sure.
I didn’t want to overcomplicate my OP but I already financed this because the finance manager told me that Subaru does NOT allow 3rd party lease buyouts, even after I told them that my plan was to lease this and sell to a 3rd party at some point.
Since the finance manager gave me completely false information, the dealership GM is offering to switch this to a lease.
However, they said they will need me to take out a second loan for the lease first and that the dealership and Chase will remove the finance loan in 15-30 days.
I am only mentioning all of this in case you had any input on whether this will create some type of nightmare credit issue or if this shouldn’t be a huge deal for someone with a relatively thick credit file. Thanks again for your help.
After paying off 2 new financed vehicles that were both totaled right after I finished making all of my payments, I guess that left a really bad taste in my mouth. I also thought cars depreciate either way so owning a depreciating asset is never a great thing? Do you typically recommend people buy out their leases then?
I like the idea of having the option to update to a newer vehicle with potentially better safety features. I don’t like dealing with maintenance and I am saving for a house so having less revolving credit from a lease vs financing might help
Accidents are never good, but would it have made you feel any better if the car was leased, insurance paid out say $8,000 more than the lease balance and you didn’t see a dime?
It’s actually the other way around AFAIK. Lenders assume payments stop after a financed vehicle is paid off, while they assume a lease is replaced with another lease which is replaced by another lease.
That’s interesting. I figured they mainly look at overall utilization and see either $10k utilized for a lease or $30k+ utilized for a finance. I did not know they were viewed differently.
If I sell this car in about 2 years to a 3rd party like Carvana, I think the lease would put me ahead since I am not paying full sales tax and Carvana does not have to pay it either, so that difference could potentially mean more profit for me compared to financing the vehicle where I have taken on the full sales tax liability. Am I right?
Your lease balance will also have an extra $650 or whatever Subaru’s acq fee is. So your equity position isn’t that much better, but you can do the math.
And the higher tax burden of a purchase isn’t a completely lost cause. If you trade in your Forester for your next car you’ll get a tax break on your next car.
Sometimes a company like Vroom bids higher than Carvana etc. and they don’t buy out leases. So a possible inability to accept the highest bid is also a consideration.
And all that assumes the finance company doesn’t change its mind about third party buyouts in the meantime.
How common is it to find dealers willing to match the highest bid? I understand anything is possible but from my limited experience it seems uncommon. When I was shopping around for this current vehicle, I spoke with car dealers from most of the major brands and 4 or 5 Mazda dealers and every single one of them was consistently $2k+ below Carvana with no interest in matching.
It sounds like, all things considered in my situation, you would lean toward financing over leasing. Is that accurate?
