Should I trade in my car (I own it) and get this lease?

Hello all. I am trying to run the math on this transaction involving a trade in plus a new lease. I own a car (financed, close to fully paid) and I have been offered what seems to be a good deal to trade-in that car and get a lease.

Information on the car I own (factory warranty expired):

  • Total cost (tax and fees incl): 30289$
  • Downpayment: 15K USD
  • Total Loan (5% interest rate, 48 months): 15289$
  • Loan Balance: 7478$ (payments are 360$ monthly)
  • Insurance: 1420$ per semester (i know, its high)

Information on the new car lease (same car but the highest end model and brand new with warranty)

  • MSRP: 64600$
  • Final price after discounts: 58625$ (9.25% electric vehicle discount)
  • Residual value 65% after lease
  • Lease terms: 36/10 paying 400$ per month and giving 1900$ driveoff
  • Total lease cost: 15562$
  • Insurance: 1930$ per semester (yep)

If I trade in my current vehicle, they would give me 30.5K USD, and I will net around 22K after paying my loan. I would make money on that transaction. I will have the cash, which I can invest and earn a yearly return. I am unsure if doing this business makes any sense or not, as it depends on the value of the cars after 36 months. It seems like I would be taking advantage of the current all time high prices, getting a good deal because of the electric vehicle discount which probably wont exist in the future

My calculations are as follows:

Cost of my new lease is 15.5K

Remaining balance of my current car loan in the next 36 months is 7478$

Differential is -8K.

By selling/trading in my current vehicle, I will get my equity back, which I can invest easily getting 3-5% yearly returns. That would get me 22K * 1.04 (power of 3). That results in +2750$ of earnings.

Last but not least, its reasonable to expect that the car market will normalize in 36 months, and therefore my current car will not sell at a premium, but at a loss. Will that price decrease be higher than 5-6K in 3 years? Highly likely.

So according to my numbers: My worst case scenario seems to be breakeven, while driving a much better car. Reason being the electric vehicle discount on the MSRP of the new lease.

Am I completely wrong?

EDIT: this is the lease I am being offered CALCULATOR | LEASEHACKR

I’m very curious what car that costs $65k is $400/month after 1900 driveoff.

Even a Kia Niro Premium barely goes for 400, and that’s a 45k car.


That was my exact question, too. Maybe a Jeep 4xe?

Also, OP, is the dealer cutting you a check for the trade? Have you determined what selling your car to another party might get you? I think you should focus on what’s happening right now, rather than what might happen in 5-6 yrs…

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$64k msrp with a 65% rv on a 36/10 sounds like a Rubicon 4xe

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Yup I just realized that a 4xe Rubi in FL is about $400.

Yea it’s the Jeep. I just want to determine if I will break even while driving a better car or if I will be on the red

The upgrade is not necessary per se. I like my current Sport.

I haven’t checked with the dealer yet on the cash, but it seems like trading in could be worth it due to tax offset?

I’m super confused

It’s not $400 with $1900 das at 9.25% off. That’s way high.

The spreasheet I just checked was 380 with 24xx drive off on a 62k. So that can translate to $400 to me with $1900

There’s no tax credit on a lease in FL

Let’s take a step back here.

Is this an order you’ve already placed, a new order, or an inventory unit?

You keep saying the 9.25% discount is the electric vehicle discount… that doesn’t make sense to me. Are you saying that the 9.25% discount is the net discount after the $7500 tax credit AND whatever discount they’re giving?

What are 3rd parties offering for your trade?

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I don’t quite understand the thought behind this. A new car has a warranty, so that really shouldn’t make a difference in terms of your total cost of ownership.

At any rate, I’d follow @mllcb42’s advice and think about some more immediate, concrete things regarding the deal, rather than about the various things that may or may not happen in the future.

This is the deal I am being offered:

Is this on a previous order, a new order, or a current vehicle?

I assume based on the doc fee this is through an out of state dealer. Have you factored in shipping/broker fees?

This is a new order, 8-12 week wait. I haven’t factored that in, so thats something Ill take into account.

The thing is, I don’t need the ‘upgrade’. I just want to make the upgrade if it is likely that this will be a breakeven (or small “cost”) deal compared to keeping my current Jeep Wrangler Sport S.

If you have the cash available from selling your current jeep, do a one pay lease. You’ll save $2500.

Speaking of your current jeep, what have 3rd party dealers offered for it?

Carvana offered 30.5K (its a 2018 All New Wrangler Sport S with 35K miles and great condition)

I think if I invest the cash, Ill earn more than 2.5K over 3 years. This simple thing became a complex financial decision for me, LOL.


This deal is a medium term bet for me. My goal is to make an upgrade with no cost/small cost.

So I am trying to figure out if the math of trading in and leasing the Jeep Rubi works out that way.

Be sure to check the other usuals… carmax, vroom, driveway, givemethevin, etc

$2500 savings on an average balance of ~6k over 3 years (~14k 1 pay less 2k dp = 12k starting and 0 ending balance) is 13+% tax free would be hard to come close with no risk


Do the one-pay. It is a no-brainer. You’ll still get like $7k cash back. Plus, it is a REALLY safe bet that you’ll maintain positive equity in the new Jeep, so that will pay back in the end, too. Sounds like you are a student (based on the “semester” comments), and having a vehicle under warranty is tremendous peace of mind, too.

You are right. My math was wrong. That’s a solid return.