New Car: Buying vs Leasing: Who Is Really Getting Ripped Off?

It's your choice.

But, why would you choose the more expensive option?

Leasing is for wealthy people. They like to drive a new car every 2-3 years. Who can blame them? It is fun. Those beautiful driving machines are not cheap. Well, let's just say it: they are very expensive. The person driving one of those cars probably wouldn't admit it. They will tell you, “Oh, I didn’t buy it, I’m just leasing it for $900 a month.” Psychologically, I guess it feels good to drive a $75,000 car for “just” $900 a month.

Of course, dealers just love these customers. You want to know what the leasing requirements are?
High credit score, full insurance coverage, low mileage at the time of return and a hefty down payment... And they come back every 3 years.

Did I mention the clause about the condition of the vehicle? Leasing agreements clearly state that the vehicle has to be in same condition at the end of lease as in the beginning. The same! It sounds ridiculous, but it’s true. Can you do it? I can’t. There is no way a regular driver could avoid "wear-and-tear" scratches on the vehicle. So, every scratch becomes a penalty. More money for the dealers!

Finally, do not forget over-mileage penalties! Usually, 10,000 miles a year is offered for free. However, every mile over the limit is extra from your own pocket. Wow!

Can you see how this all starts to add up? "Not cheap" is an understatement.

Amazingly, the dealers are getting back the cars with no scratches, low mileage and in perfect condition to sell them again!

TV commercial advertisements are mostly for leases. AMAZING DEAL: ONLY $199 A MONTH.
But, is it really an AMAZING DEAL?
It never is. You don’t have to have an accounting degree to figure it out.

There is one very important number you have to pay close attention to.
By law, a leasing company has to figure out the “RESALE VALUE” of the vehicle for when the lease expires. And it has to be clearly printed in the leasing agreement. No wonder they know exactly how much it will sell for.

This is the only number that’s negotiable when leasing.
So, let’s try to lease a regular HONDA CIVIC. We will round the numbers for ease of calculation.


MSRP: $20,000 (sticker price)

36 months x $200 = $7,200 (Monthly payment)
Down Payment: $2,000
Resale value: $15,000 (Determined by the dealer)

This is how much you are paying when you lease it.
$15,000 + $7,200 + $2,000 = $24,200

Again: MSRP: $20,000

An extra $4,200! AMAZING DEAL or AMAZING RIP OFF?
Once again, it's your choice.

Toyota Corolla 2013 - Last Chance for a Great Deal

The Toyota Corolla has been around forever. Conservative, predictable, solid, quiet and very reliable. Everybody knows and respects her. But CHANGE is inevitable. The Toyota Empire has no choice, but to change the COROLLA for the modern world.

The 2014 model will be here this summer. Korean design of small cars had a strong influence on Toyota.(Think South Korean Hyundai with lots of cool technology and gadgets, not North Korea with tanks and missiles) So, the NEW COROLLA will be no exception.

2013 Toyota Corolla

But let's talk about 2013. This is your last chance to get a Corolla for an exceptional price. There are LE and S models. S stands for Sport, but it only means an added body kit for about an extra 3k and is rarely on sale. On the other hand, LE has everything you need and nothing you don’t.

MSRP (window sticker price) is about $19,000. And here is the best part: $5,000 off!

So, for around $14,000 you can drive a totally trouble-free car for a very long time. No warranty extension, please.

Also, every TOYOTA dealer still has plenty of these cars. And Toyota Empire is giving strong financial support to the dealers to say "Good-bye" to the QUEEN.

So, while you're sipping your favorite latte on Saturday morning at Starbucks, be sure to look at the Los Angeles Times marketplace ads. Right on the front page you will see TOYOTA COROLLA LE on sale. First, grab the ad, and then grab the QUEEN. You will be glad you did.

Cheap Jeep - The 2013 Jeep Patriot

I'm talking about the Jeep Patriot. It’s not really the traditional JEEP, but with about 30% off, this baby is worth looking into. You are getting a four-door cool looking wagon for a price that does not exist on any decent car. And if you can live without power windows, doors and remote, $12 grand is the target price.

But the savings don't end there. Insurance is cheap, and the resale value is mysteriously the best on the market. So, enjoy your NEW car for three years and when the factory warranty expires, you can sell it for the same price you paid (excluding sales tax and licence fees). Sweet deal!

Here is how to get it.

2013 JEEP PATRIOT - Every Jeep dealer still has them in stock. The 2014 model has a new transmission, so the 2013 model becomes a victim. That’s when you come in and make an amazing deal.

But don’t just walk into a Jeep car dealership. It will not work. Every saturday, the LA TIMES has tons of ads for new cars. Find the one You like and present it to a salesperson. And boom, you are driving a brand new car for less, much less.

Leave a comment if you had any luck.