Overhaulin'

Can I lease to buy a car or lease then buy a car?

Im thinking about getting a brand new bmw 328xi. Im thinking about leasing it so i can save money to actually buy a car. If i decide that I want to buy it in the long run, can I do that?

Public Comments

1. Yes, when you a sign a lease there is a provision that allows you to buy it for a set price at the end of the lease, called the "residual value". However, you will likely find that your (lease payments + residual value price) will be higher than if you'd just bought the car and financed the entire purchase in the first place. Leasing and then buying a car is like "renting to own", which is always more expensive than buying outright, because you are essentially paying for the convenience of being able to walk away at the end of the lease.
2. Certainly. All lease contracts have a lease-end purchase option. The purchase price is set at the beginning of your lease and is specified in your contract. Some lease companies will negotiate that price if you decide to buy at lease-end. Buying your leased vehicle at lease-end has the advantage that you know the car's history and how it was maintained. It's not like going to a used car dealer and buying a car that you know nothing about.
3. yes
4. Absolutely you can, but not recommended. The entire point of a lease is to pay only for what you use. The problem is at the end of the lease you have to refinance and it usually isn't a good deal for you unless you put less than 8k miles a year on it. Also don't forget about the property tax involved in a lease. Depending on the payment factor, sometimes this can be another payment at the end of the year. If you are considering leasing, then don't plan on purchasing it at the end. If you want to keep it then purchase it outright. It will cost you less in the longrun too. Remember that if you do lease, you can get a 2 year up to 5 year in most cases. It is recommended that you never lease past 39 months. Otherwise you should be in a purchase position. Also, make sure that you get plenty of miles, more than needed. If you go over your milage allowance, you pay out the wazoo. Be very careful when you lease, you can get taken advantage of very easily if you don't do your homework. Negotiate a purchase first and make them go back several times. Get the lowest price of the car, not the lowest payment. Then go to edmunds.com to the payment calculater and figure the lease rates. With all of the internet help, you should be able to get yourself a good deal no matter what the car. Good Luck
5. SURE, BE CAREFUL WITH THE MILEAGE.
6. Yes. You should read the lease contract very carefully. Ask lots of questions, especially about anything you don't understand. You should compare the cost of ownership with buying outright versus leasing. It's usually better to buy than to lease.
7. Yes you can buy the vehicle later if you wish but when you lease the vehicle first you are paying more for it than you think and you dont get a break from the original price when the lease has ended.