Quote:
Originally Posted by Alfisti
Let's assume the same price lease vs buy, taxes in.
LEASE:
1078*48 = 51,744
Buy out = $29,130*1.13 = 32,917
= $84,661
BUY:
68700*1.13 = 77,631
Interest @ 5 yrs and 2.5% is 1,378
= 79,009
He is more than $5K up and if the car holds value, as the Mach 1 likely will, he could offload it for $50K and spend $29K in 5 years instead of $52K in 3 years.
So to your point, let's say he does the buy out as the car is worth more, so he buys her out, 33K, sells at $50K, for a 17K delta. 52 less 17 is 35K. He has still spent 4K more in 3 years than he would have if he bought it over 5 years. Now i realise 5 vs 3 years is unfair but a) the loan cost would also be less and b) I am not even counting the extra 2 years of leasing he would need to do to get to 5 years of ownership.
It's madness.
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Assuming he's financing the entire thing - interest at 2.5% would be more like $5k over the course of the 5 year loan.