You’ve leased car for three years, and now the lease is over, and they want to put the car up for sale.
In the meantime, you’ve named the car Emma and have fallen in love with her.
When you tell them how much you and Emma mean to each other, the dealership offers to let you buy her from them.
But is that a good choice?
First, naming a leased car might not have been the best idea.
But becoming emotionally attached to the car is something that can’t be quantified.
Here are some practical considerations when deciding to buy a lease return.
Warranty. When you were leasing, the car was covered bumper‐to‐bumper for major repairs and non‐maintenance tasks.
If the car is now yours, those repairs are yours to bear.
Find out how long the warranty is good for, and whether you can get an extension.
Incentives. Are you getting any purchasing incentives? Remember, no matter how much you leased the car for, it’s not worth that much
Most depreciation happens in the initial part of the car’s life cycle, so ask for the moon.
You might get something less grand, but if you can get something at all, it’s worth the asking.
Check with your credit union or bank: Price a lease‐buyout option.
It’s essentially a refinance, but it often offers lower interest rates than a dealership would.
It’s good to go into a meeting with the dealership and have that other option on your side.
Did you exceed the mileage limit or the time limit? In leasing a vehicle, this can create some severe charges if you’ve gone over the
agreed upon limit.
These will be waived, of course, if you buy the vehicle.
A substantial amount for a penalty might be better served applied to a down payment.
Budget: It always comes to money.
If you can pay the car off in cash, by all means, do that first.
Avoid the interest payments.
For the rest of us not so lucky to have that kind of money just lying around, find out what your budget will support.
If you have a good down payment and the monthly rates are lower, then it’s maybe a good time to buy a new car.
If not, then see if you can move into the one you have for less.
Remember, if you’re planning on buying a car anyway, it doesn’t have to be the one you’re in.
Sometimes purchasing the car you’re used to, familiar with, and enjoy makes more sense.
Try to keep the emotional investment in Emma aside and look at the purchase from a financial, realistic point of view