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I tend to buy my cars as I like to have some equity for my trade-in down the road. That said, if you are good with your money and put the extra money you save on a lease payment (vs the purchase payment) into a higher interest return investment you will likely come out ahead.

For me, I do not like the stipulations on a lease. Things like mods, scratches, dings and extra miles can all lead to extra payments at the end of the lease.


SOLD: '99 ML320 | '01 C320 SPORT | '02 ML320 | '05 E500
'15 GLA250 - SPORT, PREMIUM, MULTIMEDIA, PANORAMA, BI-XENON
 

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Discussion Starter #3
the salesperson at the dealership is actually advising me that its better to lease the gla 250 since its a new model and they have no idea what might be the problem that this model might go thru Down the road.
 

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I could be mistaken on this but I believe the sales staff are incentivized to get you to lease vehicles. That, in itself, makes me a bit hesitant to pursue that option.

While the statement about new vehicles and repairs is true enough you do have a 4yr/50k warranty which will cover any of those defects, same as the lease.

Just make sure if you go for the lease you understand all the terms and conditions clearly. I've leased a couple cars (one MB and one Range Rover) and never really found it to my liking at the time of turn in.

Again, this is just my personal preference. Your mileage may vary... :)


SOLD: '99 ML320 | '01 C320 SPORT | '02 ML320 | '05 E500
'15 GLA250 - SPORT, PREMIUM, MULTIMEDIA, PANORAMA, BI-XENON
 

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I intend to keep this car for 6+ years. Purchasing makes more sense for me than leasing.
 

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Welcome to one of the oldest debates on the internet :)

I leased mine, because it made financial sense for me. Your mileage may vary (no pun intended) so ask your dealer to show you the full worksheets - not just a monthly payment - for both a purchase AND a lease. The line of "we don't know what kind of problems this might have" is total BS. Base the decision on what you are comfortable with, not what the dealer pitches you. Remember their goal is to make money, not become your friend.

There were a multitude of factors that contributed to that decision (I've purchased my last 2 vehicles before this one):

- I knew I'd only be keeping this vehicle a short amount of time (3 years or so)
- The total cost of ownership over a 3 year lease is much less expensive than buying outright, which is what I needed.
- We have a 2nd vehicle, so mileage wasn't an issue.
- The GLA had one of the highest residual values of all the vehicles I looked at, so contributed to a lower payment compared to other models in the class
- Likely have kid(s) on the way in a few years, and I didn't want to be locked into a vehicle with a high monthly payment, plus I'll probably upgrade to a GLK anyways.
- I was able to negotiate a very low money factor (interest rate on the lease, basically) based on my loyalty to the dealership

Good luck on your decision, and most importantly I hope you wind up with a new GLA!
 

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As TwoAlpha said… oldest debates around. Those who lease vs buy and buy vs lease can make strong cases for each. Used to be leasing vehicles (US anyway) were done primarily by businesses since lease cost could be used as a business tax write off and then spread into personal leasing due to "lower" monthly lease payments vs traditional car loan payments.

Here is one view on leasing: 8 Biggest Disadvantages to Leasing a Car

And one on buying a car: The Disadvantages of Buying a Car | eHow

One suggestion and dealers do not like this… do NOT buy into 'most car you can get purchase' based on a preconceived target monthly payment. That is a sticky wicket and in many cases ends up with someone purchasing a higher cost car based on a payment plan vs buying what you really need and getting lower payments.
 
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I purchased. Partly due to inertia, I've never leased a car, so doubt that I ever will. Other reasons for me:

1. I tend to keep cars longer than 3 years
2. My financial situation is such that I either pay cash on delivery, or if financing make a hefty down payment and pay off in a year to 18 mos. With current interest rates, not taking much of a hit in finance charges either way, and monthly payment amount isn't a concern.
3. Don't want to get hit with supplementary charges at end of lease
4. Don't want to feel restricted for miles. Yes, we have 4 cars between my wife and I, so mileage shouldn't be an issue, just don't like it on principle.
5. Despite the relatively high maintenance cost at MB dealer, purchased GLA expecting it to be a quality design that is not prone to needing repair in the out years. Plus I can always opt to do maintenance myself.
 

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Here's a hypothetical comparison.
Consider a 5 year period. MSRP for a nicely configured GLA250 = $46,830.

Lease (12k miles/year) : 5000 down payment + 509/mo = $35,540
Finance (3 %): 5000 down payment + 752/mo = $50,120

At the end of 5 years of financing, you're left with a used GLA with 60,000 miles. Whereas, if you leased, you would have spent $14,580 less.

You do the math.
 

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Discussion Starter #11
Points taken, but after the 5 yrs lease, even though I paid $14k more. The car would be mine and im out of the monthly payments. But if I lease the car, I need anoyher car to lease and the monthly payments go on. I just want to make sure im thinking straight before I make the jump with my 2 feet on the hole..
 

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Yes, exactly.
When considering the lease payment of this hypothetical situation, you should divide the total amount ($35,540) by 60 months. Your actual "cost per month" is $592, not $509. Also, read the fine print. There are a bunch of extra charges at the end of the lease term, such as a "$595 turn-in fee". WTF, right?

Good luck with the purchase!
 

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Lots of strategies for leasing, one of the biggest being that you don't want to necessarily put money down and reduce the capital cost. If you have the cash up front it may make sense to apply multiple security deposits - which then lowers your money factor - which then lowers your monthly payments.

It amounts to a 3 year loan with about 12-15% return based on the money you're saving on the "interest" (money factor), because you get that full security deposit back at the end of your lease.

Not all dealers will do this however, because they make their money on that interest. Definitely work asking about, however.
 

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Discussion Starter #14
Thank you to everyone who chipped in, I decided to go with leasing route and just finance the car if I decide to buy it after 3 years. I'm so happy with my new ride!
 

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If you have the cash up front it may make sense to apply multiple security deposits - which then lowers your money factor - which then lowers your monthly payments.

It amounts to a 3 year loan with about 12-15% return based on the money you're saving on the "interest" (money factor), because you get that full security deposit back at the end of your lease.

Not all dealers will do this however, because they make their money on that interest. Definitely work asking about, however.
That's right...My salesman in So. FL had never even heard of multiple deposits...or that's what he told me (my hubby always leases his BMWs and they DO take multiple deposits). It's a great way to earn some interest on your money and lower your MF...if they'll do it.
 

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Like others have said - it's all personal preference. Neither is right or wrong.

In general though -

The "rent" argument is typically pointless. It's a depreciating asset.

If you drive more than 15k / yr than purchasing is typically the way to go.

Never put money down on a lease other than TTL (and fees). If you get in an accident and it gets totaled you'll never see the money you put down again.

If you're hard on your rides than you're better off purchasing. You don't want to be stuck with paying crazy fees for excessive wear and tear.

If you keep your vehicle more than 3 years than purchasing is typically the way to go. I'd hate to lease a vehicle with an expired warranty. Also, it's rarely a smart financial decision to lease with the plan to purchase afterwards. You'll only be paying more money for it in the end.

The GLA does have a great residual so it is a strong lease candidate. That being said, go in prepared. Go over to Edmunds and find out what the money factor (interest rate) is before going to the dealer. They WILL try to inflate it so they can make additional profit.

It's usually smart to purchase GAP when leasing. Be aware that this is also something they will try to inflate to make money (as well as the acquisition fee).

Good luck!
 
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