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Saab incentive quirks..... Posted by Mike Lynch [Email]  (#81) [Profile/Gallery]
(more from Mike Lynch) on Sat, 2 Oct 2004 13:30:19
In Reply to: Leasing *then* buying same car - Always a bad idea?, Larry, Sat, 2 Oct 2004 09:50:40 Members do not see ads below this line. - Help Keep This Site Online - Signup |
9-3 and 9-5 sedans have almost the same incentives for lease and purchase for October. For a 9-3 Linear the incentive is actually greater for a lease.
For October there is no 0% OR the incentive, the incentives have stayed the same, but I betcha' Saab Financial didn't write any 0% contracts as it was always cheaper to take the incentive and pay a market rate which always resulted in a lower payment than the 0% and no incentive.
Saab leases have always COMBINED a generous incentive and a super low rate, so when lease and purchase incentives are close you can lease for 36 months and purchase for 24 months and have a lower deferred total than if you just purchased for 60 months.
With the 9-5 Wagons there's up to a $1,500-2,500 LOWER incentive for leasing, so it doesn't work out. The sedan lease incentives are all close, the same or in the case of the 9-3 Linear even better, so it works out.
For example the interest on a 36 month loan of $30k for 36 months is $2,320
For a lease of a Saab the costs $30k after incentives, say a 9-5 or 9-3 Arc, the lease rate of in the range of .00050 (an equivalent of 1.25%) result in a cost of money of only about $22.32 a month for a total of $803.52, so if the price of the cars is the same, lease or purchase you saved about $922 in the deferred payment total, after you account for the $595 acquisition fee of a lease.
Plus you have the option to purchase the car or not, insulating you from diminished value in case of a major collision or the diminished value of the market (as in Exploder Firestone tire rollover fiasco situation), but you can still participate in any equity if that's the case.
Plus you paid lots less sales tax if you don't buy the car, only about the same if you do.
Plus your payment was lower.
When the end of your lease comes up then you can decide it your car is a good buy. The past couple of years leases written in 99, 2000, and 2001 residuals have been too high which is what your hearing about it being a bad idea. Beginnning in 2002 residuals went way down and will be much fairer so that leases that are beginning to terminate now will see a shift.
I have lots of happy customers who have bought their lease returns. It's a case by case basis and it should be getting much more favorable for buying your old lease beginning with lease written in for 2002's and newer.
I can slice and dice the deferred payment #'s lease vs purchase, but whether you'll be happy buying your lease return is always up to you. I say your always happier with a new car!
posted by 63.197.222...
, Sat, 2 Oct 2004 13:30:19 <-- Viewing This Message, Sat, 2 Oct 2004 17:12:59, Sat, 2 Oct 2004 20:18:47
, Sat, 2 Oct 2004 16:41:09
, Sat, 2 Oct 2004 11:09:56
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