Return to article: How to Decide Whether to Lease or Buy a Car
on 1/18/2006 Don't ever borrow money for more than 5 years on a used car. Don't go more than 3 years. If you cannot afford the payment, leasing may be a good idea for you. Keep in mind you can buy out a lease at any time after the first year in general. If you have a change in your financial situation, you may want to convert your lease to a buy after a few years. Consult with a financial planner first.
on 11/22/2005 If you lease a car, ensure your lease is "closed-end". If "opened-end", your rate, therefore mo. payment, can change any time during the lease. Even though "opened-end" leases are supposed to be illegal, I know (personally) they still exist! Beware!
on 11/22/2005 By making a loan over a 7-8 year repayment term your monthly payment will be about the same as a lease payment. Try to get the lowest interest rate possible -- for example, borrow through a bank line of credit at prime or near prime rates.
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