Can you Lease a CPO?

khrisx42 · #1 09-22-2008, 11:49 PM

I have a ton of negative equity i want to get rid of. Im thinking a lease might be the only way to go if a bank will finance it. Ive heard of people leasing used cars. Id like to hear from anyone who has leased a used CPO and there experience with that.

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4.6is Ryder · #2 09-23-2008, 10:07 AM

Yes you can.....Phil

B-Line · #3 09-23-2008, 12:03 PM

Horrible, horrible, horrible deals on CPO leases..

i've never heard of cost effective lease on a used car.

blondboinsd · #4 09-23-2008, 08:35 PM

Some leases are not to bad, Land Rover's CPO's lease decent, so do the bigger lexus suv's

B-Line · #5 09-23-2008, 08:59 PM

You might be right Bo... There may be some exceptions to the rule.. But none that I have ever come across.

Would you mind giving an idea of what you're talking about in terms of:
CPO LEASE:

Money Factor
Residual Percent
Lease Acq fee

I'm very curious to know how they compare to a new vehicle.

khrisx42 · #6 09-24-2008, 12:55 AM

I came across this info on leasecompare.com. to answer your question i was referring to the residual being lower

Why lease a used car?

If you're like most people you're generally ready for another car every three years. This is probably more so the case when you purchase used cars. So unless you plan to drive your car until the wheels fall off then leasing makes perfect financial sense.

Used cars do not lose their value as quickly as new ones. This means you will pay less depreciation over the term of the lease which equates to a lower payment. When you finance, you are basically paying the value down to $0 this is why a finance payment is almost always higher than a lease payment.

So what do most people do when they payoff their car loan? Finance another one, right? To do this you have to hassle with trying to sell your current car for market value or lose money by trading it in. Most cars older than six years are wholesaled not retailed, making it harder for you to find a buyer.

With leasing you're paying for the use of the car for a given term. When financing you are paying for the whole car and when you go to sell it trying to recoup the value of the amount you didn't use. What a waste of time and money!

Leasing a used car can help you get more car for the same amount as a traditional finance payment. As a bonus most luxury models have a longer warranty from the manufacturer than non-luxury.

B-Line · #7 09-24-2008, 02:14 AM

I don't doubt that there might be information about leasing CPO cars and how they are a great deal, etc. But in my experience, I've never witnessed a good deal on a lease on a CPO car.

1) The money factor (interest rate) is so high that it usually offsets any low residual.
2) Because so many new car manufacturers have good lease incentives, it usually costs the same or less to lease a new car.

So why pay the same amount for a used car as you could for a new one.

Also, I would never get a lease from swapalease either. You don't know how well or how poorly the original owner negotiated the deal. So you might get stuck with their bad deal even if they put money down..

I'm sure there are exceptions to the rule.. but again, none that I have witnessed.

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