True! The MSRP was $63,400. Ended up at $58,267 and trade in at $23,228. Tax rate here is 6% on the net amount ($35,039) so was $2102.34. We went ahead and did the deal today--picking it up tomorrow. I think we did pretty well!
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True! The MSRP was $63,400. Ended up at $58,267 and trade in at $23,228. Tax rate here is 6% on the net amount ($35,039) so was $2102.34. We went ahead and did the deal today--picking it up tomorrow. I think we did pretty well!
crowdedstr
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Funny that the voice of reason is a guy who purchased 24" rims for his vehicle...
Compelling arguments could be made for both purchasing and leasing... at the end of the day, it comes down to what works best for an individual. Leasing worked for me and I got a great deal on the purchase price, the lease terms, and even the tax situation since I researched the heck out of it all before I pulled the trigger.
On another note, it's probably the wrong forum to be judging one another's financial decisions seeing as though we all seem to want to drop 55-75k on depreciating assets that slurp down gas faster college kids with a beer ****.
Cheers.
---------- Post added at 05:31 PM ---------- Previous post was at 05:16 PM ----------
Tough to say without knowing how all the numbers break down. You'll need a sticker price, a sales price, residual value at the end of the term, current money factor for the lease, tax rates, etc. $605 sounds good at face value but without knowing how all the factors play into it, it is impossible to say if it is a great deal.
This was a really great site for me when I was researching as the mods share each month's lease terms if/when requested (this info is NOT published by the leasing companies). This will keep the dealers honest in terms of what money factor (APR) they're charging you... if you have great credit, there is no reason why you should not be able to get the buy rate. My dealer originally tried jacking the rate up by almost a full point, ~$40/month or nearly $1600 over the life of the lease. That didn't fly with me and I got the buy rate when I asked.
http://forums.edmunds.com/discussion/17265/gmc/x/2015-gmc-yukon-lease-questions
Once you have all that info (negotiate every step along the way separately), plug the details into this calculator and then you'll be able to truly be able to tell if you're getting the right deal. http://www.theautoleasecalculator.com/
Most people here think you're a dummy if you lease, and that it's all about playing with numbers to hit a certain monthly payment... in many cases it is, but if you approach it methodically enough, you'll be able to determine whether or not it's a good deal based on fact... not just the perception that $600/month sounds good for a $57k vehicle.
Good luck.
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Yes, please people....I can't explicitly recommend This Book because there is a lot of fluff in there and some of the info is a bit dated. But the principles hold absolutely true.
Negotiate every step of the process as its own separate transaction. The minute the dealer has you talking what amount you want to pay every month he is manipulating in his head how to disguise money in the trade in price he's giving you and making it look like it's coming off of your MSRP. Or he's adding it back into the financing costs (if you're not paying cash).
1. Shop your trade in before you pull the trigger.
2. Don't discuss the price of the new vehicle until the dealer has given you what you want on the trade price.
3. Don't discuss financing until you have negotiated the price you want on the new vehicle.
3a. Get pre-approved (if financing) and don't reveal that you're pre-approved
4. Tell dealer they have 30 minutes to match your financing. Or they can run with your bank/CU. Or the deal is off
5. Decline all ******** after sales offers on fabric protection, et al
6. Don't be scared to walk away at any time. There is another Yukon/Tahoe down the road.
Negotiate every step of the process as its own separate transaction. The minute the dealer has you talking what amount you want to pay every month he is manipulating in his head how to disguise money in the trade in price he's giving you and making it look like it's coming off of your MSRP. Or he's adding it back into the financing costs (if you're not paying cash).
1. Shop your trade in before you pull the trigger.
2. Don't discuss the price of the new vehicle until the dealer has given you what you want on the trade price.
3. Don't discuss financing until you have negotiated the price you want on the new vehicle.
3a. Get pre-approved (if financing) and don't reveal that you're pre-approved
4. Tell dealer they have 30 minutes to match your financing. Or they can run with your bank/CU. Or the deal is off
5. Decline all ******** after sales offers on fabric protection, et al
6. Don't be scared to walk away at any time. There is another Yukon/Tahoe down the road.
MortMan
Member
You know...leasing works for me financially as I can take advantage of tax breaks and so forth with my company and it also works for my addiction to new car smell. At the end of the day we are all lighting money on fire by buying new cars. If you bought the same truck that I did ($75,000 MSRP) at the same price that I did (~$65,000) and paid tax in my state (another $3,900) and then drove it for 3 years and put 35,000 miles on it you'll probably be at to sell it for around $38,000 or so you're lighting $30,000 on fire anyhow...I do it with and end date on paper and I shoulder none of the market risk that if gas goes to $8/gallon and nobody wants a 6,000lb SUV with a 6.2 l V8 any more and the value drops to $20,000 I didn't light another $20,000 on fire.
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Well said. Buying new is a bad financial move period, leasing or buying. If I am going to suffer alot of depreciation, it is better for me from a tax perspective to lease.
If I buy a new $60,000 car that I use 100% for work, I am at the IRS fixed depreciation schedule which for 2014 is $3460 for the year (and only $1975 in the 4th year).
However, assume a lease payment is $800, then you get to deduct the entire ($800*12) = $9600 as a business deduction. That is an extra $6140 in deduction over a buy, which means you don't have to pay tax on that money because now it is a business expense. Assuming someone wealthy is in the 35% tax bracket that means they get the car and pay $2150 less in tax as compared to if they bought that car. That is $180 less per month, so the lease is now only $620 per month. The depreciation for a purchase is fixed, but if the lease payment for the car is $1200, the benefit is even better.
At lease end, after enjoying 3 years of tax benefit, I have the OPTION to buy at about market value, and then I jump into the depreciation schedule, is still not great, but because the value of the car is lower, it is not so bad.
Again, IMO buying or leasing NEW is not a optimal use of money, but there are some times where leasing is at least as good as buying, if not better.
Now if I could just find a car to lease that I like and can afford !!
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MortMan
Member
Not to mention that I limited myself to a max of $27,792.00 (including tax) of which the gubment picks up 39% (always a 39% bracket for my company at the end of the year)...not a bad deal.
Well said. Buying new is a bad financial move period, leasing or buying. If I am going to suffer alot of depreciation, it is better for me from a tax perspective to lease.
If I buy a new $60,000 car that I use 100% for work, I am at the IRS fixed depreciation schedule which for 2014 is $3460 for the year (and only $1975 in the 4th year).
However, assume a lease payment is $800, then you get to deduct the entire ($800*12) = $9600 as a business deduction. That is an extra $6140 in deduction over a buy, which means you don't have to pay tax on that money because now it is a business expense. Assuming someone wealthy is in the 35% tax bracket that means they get the car and pay $2150 less in tax as compared to if they bought that car. That is $180 less per month, so the lease is now only $620 per month. The depreciation for a purchase is fixed, but if the lease payment for the car is $1200, the benefit is even better.
At lease end, after enjoying 3 years of tax benefit, I have the OPTION to buy at about market value, and then I jump into the depreciation schedule, is still not great, but because the value of the car is lower, it is not so bad.
Again, IMO buying or leasing NEW is not a optimal use of money, but there are some times where leasing is at least as good as buying, if not better.
Now if I could just find a car to lease that I like and can afford !!
Your scenario is not entirely true for vehicles with a GVWR over 6000LBS which the tahoe/yukon etc are. With these vehicles you can depreciate the entire cost of the vehicle over 5 years, with a maximum depreciation of 25000 a year.
junior1790
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Also section 179 is an option to take full depreciation the first year but it's currently expired, Feds usually vote it back in late December every year buts it's the best possible option for business owners.
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showtime1k
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Looking to possibly get an ltz for about 60k. What's people paying for these around here.
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