Will it be hard to get out of a Prius later?

I have never leased so I have no clue about getting out of one. I would imagine that this is a pretty good time to buy (perhaps lease) a Toyota in general, though 6-8 weeks ago would have been the best, but there are probably still some deals or incentives to be had. Also, just keep in mind that unloading any relatively new car will come with a financial hit so this would be relative to other car companies.

I think that public perception of Toyota has already improved and as long as another shoe does not drop it will continue to improve. My guess is that long term this will be just a blip.

So, the biggest bet on the resale value of a Prius would be future gas prices. If they spike like they did a couple of years ago people will be climbing over each other to buy a Prius - heck back then there were stories of old Geo Metros going for crazy prices.

 

Being able to return (or get out of the lease) is the easy part. The more difficult part will be to pay down the extra costs for doing so. It could get very expensive to get out of a lease (regardless of the percieved demand on your vehicle).

Instead, I would suggest that if you are thinking that you may not need to car the whole time, then you should just buy it (Finance it), and sell it to any buyer when you no longer need it. This will give you a chance of selling to many buyers, and will likely be cheaper (new loss wise) on you then leasing now, then trying to negotiate with a dealership who knows that they have you bent over where they want you... Just my two cents.

 

I have no experience in leases either but my two sense is it depends on when you try to unload it. In the summer for instance, when gas goes up, will be prime time to do so. I think its all a matter of timing.

 

One thing you have working against you is the high residual on the leases they're doing now. There are generally two ways to get out of the lease. One is to make all the remaining payments after turning in the car early (doesn't make much sense unless you're really close to the end of the lease). The other way is to get a payoff amount from the lessor. Essentially, you're buying the car out of the lease. Then, you sell it (either to the dealer or to a third party). As a rule, the difference between the payoff amount and the market value (your deficiency) is higher earlier in the lease than later. The leasing company is betting that the car will be worth the residual value at the end of lease. Because the residuals are so high on these cars right now, it is less likely you will be able to get out unscathed if you try to exit the lease early. Perhaps you should look into one of the mfrs offering relief to those who purchase their cars and lose their jobs (Hyundai, I think, has such a program).

 

If you can't pay cash for it....should you really buy it anyway?

 

One of the downsides of leasing is being locked into a fixed lease term. One answer is the many lease matching sites, where you list your car, and somebody else looking to lease a car agrees to take over your lease--although you may have to offer a financial incentive to do this.

Of course, if you buy a car and finance it, then after a short while decide to sell it, you'll likely be upside down, and take a hit in the process.

 

Huh?

How many people pay cash for a car? Not many.

Prior to my Prius (which I decided to lease to transfer the residual risk in this rapidly changing auto market to somebody else), for the last 20 years I've paid cash for my cars--but the majority of people finance their cars (through loans or leasing).

 

As noted above it's never a good thing to have to sell a vehicle 'early' such as within the first two years. You're going to take a loss no matter what you choose to do barring some unusual situation such as $5 per gallon gas all over the country or a war that stops the flow of oil.

I've done both, purchased and leased. On the leases

• I've run them to the end and turned them in
• purchased them from the lender before the lease is final

Both are good options depending on your personal circumstances.

If you think that there's a realistic risk of losing your job within 3 yrs then think about buying a USED Prius. It's a better value right now. You get it for a much lower acquisition price and you still save gobs of money in fuel not used.

 

I haven't done anything but for close to 30 years....since my early 20's

 

Lucky you.....Will you give me a loan?

For the rest of us....

I have leased for 20 years. No problems ever...just turn the car in at the end and walk away. You must be the right candidate though...

Always want to drive the latest...
Always keep the car clean and in good shape...
Have only a modest taste for mods...
Know and can control your milage...

A zero money down sign and drive gives you the greatest control over the lease transaction...never make a down payment on a lease...that is money out-of-your pocket early...keep that money and invest it.

You see if you purchase a car...Pay it off...and purchase a new one again right away you are taking the greatest hit of all.

If you keep the car a few years after you pay it off then great...buy. I have never met a senior accountant/banker/or investor who owned a car. They mostly lease and so do I.