Lease to own and modify?

[Krak-A-Pat]

If it were up to Dave Ramsey, we'd all be living in tents, eating Top Ramen, and walking, while the rich just have their way with everything.

That guy is far too extreme. Although I wouldn't modify a lease at all and leasing isn't a good bet these days, you're spot on with milage, as it's best to get more than you need.

Young man may not actually be able to afford an expensive Bronco, but hey, you only live once and we've all done it, recovered, and learned from it, so as long as it doesn't ruin your life, have some fun!

I've leased for the last few years due to waiting on the bronco. I always got more miles than needed to make sure I wouldn't go over, and while I can "afford" to buy it with getting a loan. my thought is, that if I could lease it and just get lower payments for a bit great. My intention is never to trade it in. It will be to purchase afterwards and finance on 25k rather than 50k. Ultimately just trying to get creative with payments.

Sponsored

 

[HotdogThud]

If it were up to Dave Ramsey, we'd all be living in tents, eating Top Ramen, and walking, while the rich just have their way with everything.

That guy is far too extreme. Although I wouldn't modify a lease at all and leasing isn't a good bet these days, you're spot on with milage, as it's best to get more than you need.

Young man may not actually be able to afford an expensive Bronco, but hey, you only live once and we've all done it, recovered, and learned from it, so as long as it doesn't ruin your life, have some fun!

And i'm not even in the camp against leases. I kinda wish I could do them, because I want to try every car there is. I just drive too damn much to ever get away with it

 

[Krak-A-Pat]

Leasing with the intent to own it in the end is the worst way about procuring a vehicle. Especially, a high residual vehicle like a Bronco. You will make payments to a residual value of 50% with a pretty stout money factor over three years and save $40/month and then have to pay more to actually take it off their hands with zero negotiation since the buyout was determined on day one of the lease. Run the numbers both ways but make sure you understand the tax, title, and registration implications in your state around leasing.

If you want to own and modify and have zero restrictions, buy it outright on day 1. Almost always, extending the purchase loan term longer to lower payment is better than the strategy you propose.

awesome, Thanks for the response!

 

[HLD93]

Does anyone know if I were to lease my Bronco (lower down payment and lower monthly payments) and then added upgrades to it (i.e) bigger tires, skid plates rock rails etc) would I have to remove it all when my lease was over and I went to buy the vehicle? Or can I keep it all on and just sign some papers?

I have only bought out a lease with GM. assuming it would be same process, you can do either at dealer or online/by mail. If you do with dealer, there might be other fees. Doing online/mail was very easy and no fees. Either way they don’t care what condition the vehicle is in, as long as you can provide odometer and payment for what you owe- which includes any remaining lease payments, and then the buyout. And then they will mail you the title. Again, I don’t know if this is different with Ford- so maybe someone else can confirm

 

[Krak-A-Pat]

someone else brought up a good point and that was that the bronco holds its value longer, So, then my next question would be if I paid 15,000 total over the lease term would my buy out price be 15k minus the value of the bronco when lease began? or would it then be on say the bluebook value...

 

[MadMan4BamaNATL]

I've leased for the last few years due to waiting on the bronco. I always got more miles than needed to make sure I wouldn't go over, and while I can "afford" to buy it with getting a loan. my thought is, that if I could lease it and just get lower payments for a bit great. My intention is never to trade it in. It will be to purchase afterwards and finance on 25k rather than 50k. Ultimately just trying to get creative with payments.

I get what you’re saying, but I’ll point out that in the end, you’ll be paying more money by leasing then financing the residual at lease end. Unless, you finance for only 24 months, but do the math first on what those payments would be. Caution on speculating on lower interest rates, as it’s best to do a worst case analysis. If rates are lower later, good.

To your original question, that will vary by dealership and it’s possible they’ll play funny business with you at lease end.

Again, you shouldn’t modify a leased vehicle. Something happens to it, you loose it all.

The entire purpose of a lease isn’t to lower monthly payments, it’s to minimize risk and debt exposure; nothing else. I also think it’s bad to put money down on a lease; any at all is a bad bet.

Anyway, Ford lease terms are terrible right now, so not sure what savings there would be, but again, do the math because at the end, you’ll notice the savings are minimal.

 

[cbrenthus]

Here is the balloon calculator, it won't tell you the residual but will give you an idea of the payment. Make sure to select Ford Trucks, not Ford for the Bronco:

https://secure.autofinancialgroup.com/AFG/index.jsp?CUID=99999

Here is the info on CapEd specifically, fill out the app and they will contact you. It was very easy to get set up, the woman I worked with was very professional and supportive. I had to get a notarized power of attorney and send to them with tracking before they would release the check, and they sent the check immediately and sent me pictures of the check and tracking.

https://capedcu.com/_assets/files/loans/payment-saver-program.pdf

 

[FreddieLee]

Folks actually lease Broncos?! That just seems.... wrong.

 

[Krak-A-Pat]

I get what you’re saying, but I’ll point out that in the end, you’ll be paying more money by leasing then financing the residual at lease end. Unless, you finance for only 24 months, but do the math first on what those payments would be. Caution on speculating on lower interest rates, as it’s best to do a worst case analysis. If rates are lower later, good.

To your original question, that will vary by dealership and it’s possible they’ll play funny business with you at lease end.

Again, you shouldn’t modify a leased vehicle. Something happens to it, you loose it all.

The entire purpose of a lease isn’t to lower monthly payments, it’s to minimize risk and debt exposure; nothing else. I also think it’s bad to put money down on a lease; any at all is a bad bet.

Anyway, Ford lease terms are terrible right now, so not sure what savings there would be, but again, do the math because at the end, you’ll notice the savings are minimal.

Yeah, you drop a lot of truth. Doesn't make much sense. Thanks for the reply!

 

[stickshifthappy]

Isn't that kinda like Bad Idea Jeans from SNL many years back ?

 

[vbrad26]

someone else brought up a good point and that was that the bronco holds its value longer, So, then my next question would be if I paid 15,000 total over the lease term would my buy out price be 15k minus the value of the bronco when lease began? or would it then be on say the bluebook value...

When you sign the paperwork, you will know right then and there what the value would be at the end of the lease.
Basically, they will say that the value the car is $XX,XXX after 3 years, and that will be the price if you want to buy it at the end.
That can work out well for you, or it won't. If it works out well, that means they under valued the car and you could buy it for cheaper than another 3 year old Bronco off the lot. You can even use that equity if you decide to trade in the leased Bronco on another vehicle.
Or, they over value it, and at that point you can just walk away.
Some cars lease much better than others. I have no clue what a lease deal on a Bronco looks like.
Sometimes, it is just better to finance because the monthly payment won;t even be that big of a difference in the short term, and in the long term, it may just be a better financial decision, since you know you have that "asset" at the end.
Play with the numbers on Fords website.
I just 'built" a Badlands and the difference between a 3 year lease with 12,000 miles a year or a 6 year finance is only $48.
$707/month lease or $755/ month finance, both with $4919 (10%) down.
I'd also advise to NEVER put any money down on a lease.

 

[TKE_273]

I work for one of the countries largest and oldest auto finance companies, and I personally typically lease at least one of my vehicles (usually my wife's daily).

With respect to the high demand for Broncos, leasing is not going to be a great deal, even if you can arrange lease terms that have lower down payment and lower monthly payments vs traditional financing.

The residuals and money factors on a Bronco lease aren't in the consumer's favor, basically because they don't have to be - Ford will sell every Bronco without having to offer incentives or attractive lease deals.

Leasing in general has become much less of an attractive deal since the OEMs have struggled to keep production up with demand. As soon as you start seeing $5k-$10k off MSRP and incentivized rates return to market, that's when you'll start to see lease deals that make more sense.

 

[BroncoAZ]

My wife’s Tacoma is leased for another year, we weren’t planning on buying it out at inception. The truck had an MSRP of $42K and a residual value of $30,500. Toyota had a incentivized lease deal at the time. The total lease cost for the down payment and all monthly payments is $14,500. With the current value of the truck it makes sense to buy it out and trade it or sell it privately. With the subsidized lease I never planned on having equity.

If it were up to Dave Ramsey, we'd all be living in tents, eating Top Ramen, and walking, while the rich just have their way with everything.

That guy is far too extreme. Although I wouldn't modify a lease at all and leasing isn't a good bet these days, you're spot on with milage, as it's best to get more than you need.

Young man may not actually be able to afford an expensive Bronco, but hey, you only live once and we've all done it, recovered, and learned from it, so as long as it doesn't ruin your life, have some fun!

Dave Ramsey has a plan to help those who are irresponsible with money get back on track. I’ve purchased his book and paid for his 9 week course for a couple family members. The results have been positive, those people have gotten their act together and don’t have the same dumb money problems as before. I made plenty of dumb decisions in my 20’s and early 30’s that took me until my late 30’s to dig out of. I didn’t hear Dave Ramsey until after I was paid off, but I basically did his debt snowball on my own. I did keep car loans and did keep collecting the match on my 401K, but the debts got prioritized and paid off smallest to largest.

The more advanced steps of his plan are conservative and leave opportunities on the table compared to more aggressive investments, but he has helped guide many people to millionaire status. I fully support driving a paid for car and living in a paid for house and having 6 months worth of expenses available liquid or close to liquid. I just purchased a new home last month, but before that I was debt free except for a truck lease and low interest Bronco loan with a bank balance 5X my annual income from selling our previous home. The peace of knowing I didn’t have to worry about my job security or some bill that came up was very nice.

 

[RHeinz]

OK, here’s my opinion on leasing a vehicle.
1) Ford makes their profit.
2) The Ford dealer makes their profit.
3) The leasing company makes their profit.

So you end up supporting 3 business rather than two. How can that possibly be cheaper?

OK, if you are using the vehicle for business purposes and it is a business expense, leasing as opposed to owning can be an advantage.

Please straighten me out on this. I worked with an engineer who swore by leasing. I guess you never own or have to deal with the asset, like renting.

 

[BroncoAZ]

OK, here’s my opinion on leasing a vehicle.
1) Ford makes their profit.
2) The Ford dealer makes their profit.
3) The leasing company makes their profit.

So you end up supporting 3 business rather than two. How can that possibly be cheaper?

OK, if you are using the vehicle for business purposes and it is a business expense, leasing as opposed to owning can be an advantage.

Please straighten me out on this. I worked with an engineer who swore by leasing. I guess you never own or have to deal with the asset, like renting.

The business advantage of leasing (not putting the capitalized asset on that part of the ledger, instead showing it as an operational expense) was largely diminished with a tax law change that went into effect late 2021 or so that considers TRAC leases a capitalized asset. We discovered that the lease fees charged by our leasing company for the TRAC leases were excessive, so we shifted 100% to traditional purchases.

https://www.grantthornton.com/insig...key-tax-impacts-from-the-new-leasing-standard

Sponsored