Leasing car

[khrd2]

Hi! Starting pgy1 in July and I need a new car. Been driving a 2004 Toyota since high school but it is not reliable anymore! Gave me a lot of problems over the years but it’s time to put it to rest! Can’t afford to buy a car because I don’t have money saved up. How feasible is it to lease a car for anyone who has done it

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[GoSpursGo]

Hi! Starting pgy1 in July and I need a new car. Been driving a 2004 Toyota since high school but it is not reliable anymore! Gave me a lot of problems over the years but it’s time to put it to rest! Can’t afford to buy a car because I don’t have money saved up. How feasible is it to lease a car for anyone who has done it? (On a side note I don’t have any other expenses like rent/food).

If you miraculously have no other expenses, then sure you shouldn't have any problem leasing a car...

 

[BoardingDoc]

Hi! Starting pgy1 in July and I need a new car. Been driving a 2004 Toyota since high school but it is not reliable anymore! Gave me a lot of problems over the years but it’s time to put it to rest! Can’t afford to buy a car because I don’t have money saved up. How feasible is it to lease a car for anyone who has done it? (On a side note I don’t have any other expenses like rent/food).

You can absolutely lease a car and it should be easy to find a reliable, not flashy car which is 0 (or close to 0 down) and just monthly payments. Seeing as you have no other expenses, I'm assuming that you are living with your parents or are otherwise "kept". You could always ask whoever is paying your bills for some clarity on how to lease a car.

 

[ThoracicGuy]

Hi! Starting pgy1 in July and I need a new car. Been driving a 2004 Toyota since high school but it is not reliable anymore! Gave me a lot of problems over the years but it’s time to put it to rest! Can’t afford to buy a car because I don’t have money saved up. How feasible is it to lease a car for anyone who has done it

Some car companies are offering incentives, including 0% loans to purchase. It might be worth looking into this, even if it's something cheap like a Kia. Probably better than leasing and may not be much difference cost-wise.

 

[BicepsTriceps]

Hi! Starting pgy1 in July and I need a new car. Been driving a 2004 Toyota since high school but it is not reliable anymore! Gave me a lot of problems over the years but it’s time to put it to rest! Can’t afford to buy a car because I don’t have money saved up. How feasible is it to lease a car for anyone who has done it

Look into 0% finance.

Should be easy with good credit as a resident doctor.

The Camry TRD is a cheap sexy sport sedan.

 

[Dave1980]

You'll be making like >55k as a resident. You can afford to lease or buy a car. I got my loan with 0 zero 2.9% interest. I got a mid level car and the payment is 500/month.

 

[Dr.LeoSpaceman]

I leased a car through the first few years of residency. The advantage is you can get a nicer car for a lower price vs. buying. The downside is that it's not an asset, and you can get dinged on the back end depending on how well you take care of it and how many miles you drive. For all intents and purposes, it's basically just a long-term rental. That can have its own advantages if you think your transportation needs might change in 2-3 years.

The other nice option is that you can buy the car off the lease at the end. That price to purchase is fixed based on the residual which is established at the time you initiate your lease. So I "bought" my own used car after 3 years for about 3k cheaper than I would have paid for a similar used car.

All in all, I probably paid more over the life of the deal to own it outright. However it kept my payments pretty low (~$250 on a car which was $24k). As a resident, the monthly cash flow issues took precedence so it worked.

 

[calvnandhobbs68]

Hi! Starting pgy1 in July and I need a new car. Been driving a 2004 Toyota since high school but it is not reliable anymore! Gave me a lot of problems over the years but it’s time to put it to rest! Can’t afford to buy a car because I don’t have money saved up. How feasible is it to lease a car for anyone who has done it

Im guessing you haven’t had much experience with loans of any kind? You don’t have to have “money saved up” to buy a car unless you’re taking about a down payment (which a lot of dealerships don’t even require for cheaper cars). If I were you I’d buy a certified pre owned car which is going to be much cheaper over the long run than leasing a car and comes with a factory warranty for most CPO programs. Unless you’re planning on getting a new car every 3 years or can use it to reduce tax burden (ex. Small business owner, contractor, etc), leasing is generally a bad idea.

 

[<L>]

Look into 0% finance.

Should be easy with good credit as a resident doctor.

The Camry TRD is a cheap sexy sport sedan.

I've been borrowing a Camry SE (sort of an an earlier version of the Camry sport model) this month and it's a surprisingly fun car to drive.

 

[BicepsTriceps]

I've been borrowing a Camry SE (sort of an an earlier version of the Camry sport model) this month and it's a surprisingly fun car to drive.

I'm driving an XSE myself and honestly it's the most smooth and fun to drive compared to almost anything else in its brand.

Graduating soon myself and eyeing a 2020 Ford Raptor vs keeping my XSE until the new gen Raptor comes in 2021/2022 vs buying a more luxury brand sport sedan lol

To OP,
Get a Toyota, nothing beats its reliability which you need as a resident.
Free service for 2 years.
Almost never breaks.

The new RAV4 prime looks delicious too if you're more into SUVs (Might be too expensive for a resident though).

Or look at a pre-owned certified Lexus, used models from 3 years ago almost priced as a new Camry.

 

[Saddleshoes]

If you must lease be aware of the mileage limits in the contract.

The way most of them work if you should have a round trip commute of 40 miles or more to work you are screwed.

 

[NITRAS]

I leased a car through the first few years of residency. The advantage is you can get a nicer car for a lower price vs. buying. The downside is that it's not an asset, and you can get dinged on the back end depending on how well you take care of it and how many miles you drive. For all intents and purposes, it's basically just a long-term rental. That can have its own advantages if you think your transportation needs might change in 2-3 years.

The other nice option is that you can buy the car off the lease at the end. That price to purchase is fixed based on the residual which is established at the time you initiate your lease. So I "bought" my own used car after 3 years for about 3k cheaper than I would have paid for a similar used car.

All in all, I probably paid more over the life of the deal to own it outright. However it kept my payments pretty low (~$250 on a car which was $24k). As a resident, the monthly cash flow issues took precedence so it worked.

Leasing is more expensive than owning. And since it isn't technically a "loan," the lender isn't required to give you the truth in lending paperwork with your interest rate and expected interest payments.

The car companies push leasing because it makes them more money on the financing and it pushes people to buy more expensive cars. It isn't good for the consumer.

 

[blue.jay]

Here is the rule of thumb.
Your month lease payment (without taxes, and zero down) for 12k miles per yr for 3 yr lease should be roughly 1% of MSRP.
Certain cars lease well (depends on their residual and moneyfactor aka interest).
You can even lease a BMW for 100$ if you put 15k or more down(which is a stupid idea- don't put downpayment on a lease)

Treat it as a long term rental.
As a resident you can afford to lease cars below 30k MSRP. Nissan and Hyundai's lease well. Honda lease is expensive. Mazda and Toyota is somewhat in between. BTW Hyundai/Kia has 10 yr 100,000 mile power train warranty for new/CPO.

Good used cars - civic, Corolla, Camry, accord, mazda3, mazda6

Funny peppy cars on a resident salary - Elantra GT, Hyundai Veloster, Kia Forte GT, GTI, civic si/hatchback

 

[Dr.LeoSpaceman]

Leasing is more expensive than owning. And since it isn't technically a "loan," the lender isn't required to give you the truth in lending paperwork with your interest rate and expected interest payments.

The car companies push leasing because it makes them more money on the financing and it pushes people to buy more expensive cars. It isn't good for the consumer.

Yeah, which is why I said I paid more over the life of the car to own it. But as with anything, I knowingly made that trade-off for things I wanted at the time. If all I cared about was paying the least amount possible to own the car outright, I wouldn't have leased. But as with most things, there were other considerations.