Automotive

Help us settle family debate - drop by with your strong opinion ;-)

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  • May 4th, 2019 1:19 am
Deal Addict
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Jul 26, 2007
4543 posts
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Toronto
kitscha wrote: Thanks all... responses/thoughts:

- we're currently in a 2009 minivan, it served us well but it's time has come
- option #1 is Honda certified - so buying used would still give us a solid three years and 90,000kms of warranty... but yeah, it's used (then again, is $10k+ less than new - that buys quite a few brakes and tires)
- stay away from the ex-rentals, got it!
- leasing new is def an option, I'm just nervous about sinking three years of payments into something that we eventually decide we don't want = no equity... can you help me understand the benefits? (new car I guess is the big benefit)
- if we dig for more options: older RAV 4 vs older Honda CR-V - which way would you jump?

Appreciate all the assistance so far!
For leasing, if you haven't done before maybe stay away if you don't have deposable income to throw money at. It's exactly what you are thinking, no equity after the term.

If you bought the 2009 car new and drove for 10 years, leasing works totally opposite of that. Think of renting a car every 3 years. But you get to drive new ride every time.

There is some benefit of leasing like 0% lease interest rate vs 1.99% finance. In that case, better to lease and pay the buyout fees if you want the car after the term. But lease rates are usually higher then financing rates.
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Sep 1, 2004
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http://owners.honda.com/vehicle-informa ... ement.html

Remove 1 from you list as well.

If I were you OP, 5 is the only way to go.

Leasing only works if you have car ADD. If you are going to keep a used car more than 5 years and new one over 7 or 8, leasing is more expensive unless you are leasing to own afterwards.

Also, may be I'm not shopping in the segment, but I rarely see good lease deals with Minivans.

MDX has pretty good resale value in the past. A new one is on the horizon so I'm not sure if the current one will be on huge discount this spring/summer or not.
Last edited by Xtrema on Apr 26th, 2019 12:30 pm, edited 1 time in total.
[OP]
Jr. Member
Aug 23, 2014
181 posts
61 upvotes
Vancouver, BC
Also... I see down payments listed against leases - is the point just to reduce your monthly payments? Wouldn't that money be better in your pocket? (Sorry, total lease idiot, but would rather be stupid here than at the dealer.) And... when is a security deposit an option and what is it? (I'm assuming that it's a refundable down payment to lower your monthly payments... and you can apply it to the car if you decide to buy?)

Finally... has anyone here done a single-pay lease, ie. paid the whole x years up front? Advantages and disadvantages?

Honda is currently showing 0.99% on a 24 month lease term for a new CR-V LX. That's a $545 per month payment. Does that make it significantly more attractive than buying used or financing new? On the up side, we could lease for two years at a great finance rate, save up more towards paying it off, not have to put down a deposit, and take the buyout after two years - in that case we're basically just paying for the depreciation as we drive it, yes? On the down side we could lease for two years, decide it's not for us, and kiss goodbye those two years of payments with zero equity.

And... I'm assuming with leasing you don't walk into the dealership and announce you want a lease? You say you're buying and agree on the price of the car first? Or is that not the case - do you work backwards - I want to lease, so please get my payments on this new car down to an acceptable level? (which would presumably happen by reducing the price of the car)
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Jul 26, 2007
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kitscha wrote: Also... I see down payments listed against leases - is the point just to reduce your monthly payments? Wouldn't that money be better in your pocket? (Sorry, total lease idiot, but would rather be stupid here than at the dealer.) And... when is a security deposit an option and what is it? (I'm assuming that it's a refundable down payment to lower your monthly payments... and you can apply it to the car if you decide to buy?)

Finally... has anyone here done a single-pay lease, ie. paid the whole x years up front? Advantages and disadvantages?

Honda is currently showing 0.99% on a 24 month lease term for a new CR-V LX. That's a $545 per month payment. Does that make it significantly more attractive than buying used or financing new? On the up side, we could lease for two years at a great finance rate, save up more towards paying it off, not have to put down a deposit, and take the buyout after two years - in that case we're basically just paying for the depreciation as we drive it, yes? On the down side we could lease for two years, decide it's not for us, and kiss goodbye those two years of payments with zero equity.

And... I'm assuming with leasing you don't walk into the dealership and announce you want a lease? You say you're buying and agree on the price of the car first? Or is that not the case - do you work backwards - I want to lease, so please get my payments on this new car down to an acceptable level? (which would presumably happen by reducing the price of the car)
You would negotiate for out the door price first then using that single price(including all discounts and fees) ask what the payment for lease or financing would be. You can negotiate anyway you want but be sure to go back to single negotiated number as it only takes a minute to calculate lease or financing on their computer.

For security deposit, it reduces % per amount like $1000 for every 1/2 %. As for deposit on lease or lumpsum payment, it's stupid imo. When you get into an accident in 5th month of the lease, some weird shit happens and sometimes the insurance just pays the leasee minus the deposit and goodluck getting any of prepaid money back.

Read some horror stories on here how some didn't get their deposit back.
Penalty Box
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Jan 27, 2014
4793 posts
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If you're only looking at keeping this car for 3-4 years remember this:

It is better to lease 2 cars over 8 year span than buy 2 cars within 8 year span.
Sr. Member
Jun 18, 2018
953 posts
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Toronto
Xtrema wrote: http://owners.honda.com/vehicle-informa ... ement.html

Remove 1 from you list as well.

If I were you OP, 5 is the only way to go.

Leasing only works if you have car ADD. If you are going to keep a used car more than 5 years and new one over 7 or 8, leasing is more expensive unless you are leasing to own afterwards.

Also, may be I'm not shopping in the segment, but I rarely see good lease deals with Minivans.

MDX has pretty good resale value in the past. A new one is on the horizon so I'm not sure if the current one will be on huge discount this spring/summer or not.
If you plan on having a new car for 7-8+ years, would it be better to finance or lease for 3 years then buy-out? I am sure there are a lot of factors but generally speaking...

It's such a tough decision
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Sep 1, 2004
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Electrah wrote: If you plan on having a new car for 7-8+ years, would it be better to finance or lease for 3 years then buy-out? I am sure there are a lot of factors but generally speaking...

It's such a tough decision
Depends on rate and discount and your financial situation.

Lease and buyout works when you can pay it off at the end in lump sum. If you can't and are not discipline with your money, do a low rate 60 month finance if available and try to pay it off before warranty is over.

If you are keeping car for 7 or 8 years, you should not have car payments beyond 5 as repairs and other wear and tear items starts to kick in and you will have to budget for those.

Leasing is all about putting least amount of cash into a depreciating asset as possible and free up your money to invest in something else. If you are doing it because you can afford next price tier of cars, you are doing it wrong. Cars that have great resale in the used market are usually not good lease (Tacoma/Wrangler).
[OP]
Jr. Member
Aug 23, 2014
181 posts
61 upvotes
Vancouver, BC
Xtrema wrote: Depends on rate and discount and your financial situation.

Lease and buyout works when you can pay it off at the end in lump sum. If you can't and are not discipline with your money, do a low rate 60 month finance if available and try to pay it off before warranty is over.

If you are keeping car for 7 or 8 years, you should not have car payments beyond 5 as repairs and other wear and tear items starts to kick in and you will have to budget for those.

Leasing is all about putting least amount of cash into a depreciating asset as possible and free up your money to invest in something else. If you are doing it because you can afford next price tier of cars, you are doing it wrong. Cars that have great resale in the used market are usually not good lease (Tacoma/Wrangler).
This was a fantastic explanation, thank you.
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Jun 19, 2001
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"- stay away from the ex-rentals, got it! "

No i would look there. a car 6 months to a year old at a significant discount, 20k-40Km or so, with lots of warranty left. A lot cheaper then leasing new and ending up with nothing.
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Sep 9, 2012
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Oakville, ON
@kitscha have you sat in or driven the SUVs you’re looking at? They’re significantly smaller compared to your van than you think they are. It’s not just the 3rd row you don’t need that makes them smaller - it’s also leg room, shoulder room, head room, etc, etc.
[OP]
Jr. Member
Aug 23, 2014
181 posts
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Vancouver, BC
CanadianLurker wrote: @kitscha have you sat in or driven the SUVs you’re looking at? They’re significantly smaller compared to your van than you think they are. It’s not just the 3rd row you don’t need that makes them smaller - it’s also leg room, shoulder room, head room, etc, etc.
Not yet... only doing online research at this stage. We've had friends downgrade to compact SUVs and be okay with it - but of course that doesn't mean we will be. We're a tall family, so they may not be the best choice... but figured I had to start the research somewhere.

If you have any suggestions for an economical (that's the tough part) replacement for a minivan that won't break the bank, do weigh in - keeping in mind that we don't need all that room but obvs still need enough room, KWIM?
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Sep 9, 2012
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kitscha wrote: Not yet... only doing online research at this stage. We've had friends downgrade to compact SUVs and be okay with it - but of course that doesn't mean we will be. We're a tall family, so they may not be the best choice... but figured I had to start the research somewhere.

If you have any suggestions for an economical (that's the tough part) replacement for a minivan that won't break the bank, do weigh in - keeping in mind that we don't need all that room but obvs still need enough room, KWIM?
I think you should go as a family and check them out on the lot and take test drive before spending much more time researching. You’ll either be pleased that the downsize will be fine, or you’ll be shocked that it won’t work as well for you as you’d hoped. Then you can further refine your research from there.
[OP]
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Aug 23, 2014
181 posts
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Vancouver, BC
CanadianLurker wrote: I think you should go as a family and check them out on the lot and take test drive before spending much more time researching. You’ll either be pleased that the downsize will be fine, or you’ll be shocked that it won’t work as well for you as you’d hoped. Then you can further refine your research from there.
You are quite right. We have limited time, so was doing as much online looking as possible before the weekend hit - which is when we can make it out to the lots. Figured I'd try to get my head around the compact SUV field options first, go up in size from there if it won't work for us.
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Sep 9, 2012
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Maybe Kia Sedona will fit the gap between the SUVs you’re looking at and your old van. I think they’re smaller than Sienna or Odyssey but bigger inside than CRV or RAV class vehicles.
[OP]
Jr. Member
Aug 23, 2014
181 posts
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Vancouver, BC
CanadianLurker wrote: Maybe Kia Sedona will fit the gap between the SUVs you’re looking at and your old van. I think they’re smaller than Sienna or Odyssey but bigger inside than CRV or RAV class vehicles.
Thank you, that's a great suggestion, and was actually on our list. Great safety rating too (tied with the Odyssey) and cheaper than the SUVs.

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