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kroberts
March 30, 2012, 15:45
Another question for my British relo friend.

I'll try to be brief.

This friend of mine is relocating from England to Raleigh NC. Will obviously need a car. I have had a number of friends, and two of my sisters, recommend Carmax. Spoke to Carmax rep about residency requirements (visa) and financing a car versus paying cash for one. Since friend doesn't have an American credit history, she could probably get financing with a large down payment. Large down payment got me thinking about a lease. She could get into a new car...with full warranty...for less monthly.

I dont know a thing about leasing. What happens if she looses her position. They would revoke her visa, she would have to return to England (this isn't a possibility, I'm just playting devil's advocate). Can you turn in a lease early?

Can anyone recommend an unbiased lease vs. buy site for some research?

Any comments are welcomed.

TIA

BUFF
March 30, 2012, 16:04
Leases have numerous "what if?" clauses built into them that require hefty payments to the company if any of the lease provisions (mileage driven, early turn-in, "excessive wear", etc) are not adhered to. They are not very flexible.

Generally, leases are usually a good deal only to folks who like to buy a brand new car every two or three years anyway.

chet
March 30, 2012, 16:26
Carmax = Won't get a screaming deal. Won't get bent over. Usually, Carmax deals are pretty close to standard retail pricing with some nice coverage deals if she is worried about getting the shaft.

Lease = "I intend to only drive new cars. I will pay a premium to do so, eating the retail value of a vehicle for a dealer so he can sell it for a hefty profit as a used vehicle later."

Purchase = "I intend to maximize the buying power of my dollar for a given item, finding the best deal I can and getting as much use out of the vehicle as I can."

Credit = This is a discussion she should have with her prospective employer. Additional costs due to moving should be part of the hiring/relocation process. Assuming her employer has other foreign employees, they have probably down this before. It may be as simple as having them agree to co-sign the loan to eliminate the need for the down payment. No additional cost to anyone.

steve3320
March 30, 2012, 19:52
If its a temporary re-lo (3 years or less) a lease my be perfect. Otherwise I would say purchase.

You will pay more for a car at CarMax than anywhere else IF you have any negotiating skills and don't mind putting up with salesman. If you just want to go in and buy a car without the song and dance and are willing to pay for that privilege, than CarMax may be the way to go.

She also may want to check with her employer --- if it is large enough to re-lo her they may have an affinity program with Ford / GM / etc. or they may have fleet cars they sell at a discount to employee's (mine does these things).

Failing all that, if she can't pay cash for a used car and is going to finance, the difference in rates and incentives for used vs new cars can make the new car a better deal than a 1-2 year old car with an uncertain driving history (Carfax reports DO NOT show you everything by any means, but they make you feel warm and fuzzy if you get one).

My thoughts -- worth exactly what you paid for it :shades:

Renovator
March 30, 2012, 23:00
Re-location and compensation bennies aside, leasing is normally driven miles dependant.

Folks that like to drive, buy; those that like to look like they're driving, lease.

RG Coburn
March 31, 2012, 08:11
If she's here temporarily,why not just buy a decent used car,and re-sell before she heads back?

pmf
April 03, 2012, 10:15
The used car market is really strong right now. Over the last 4-5 years, new car sales were in a huge slump -- from 16M units down to around 11-12M per year. Plus, people are holding onto their cars longer. So now, 4-5 years later, there's a shortage of used cars and they go for a premium.

CarMax -- I never got Car Max. Come buy a car from us, there's no negotiating involved. What's so great about that? I can walk into any other lot in the country and buy a car there without negotiating either. I guess its for the 'I'm too timid to negotiate, but want to feel like i'm not getting screwed when I don't do it' crowd.

Leasing -- It's a big premium to pay to have the luxury of always driving a new car. Plus, they hammer you if you exceed the allowed miles. I'd be afraid to drive it too much. That kind of sucks.

Frankly, I tend to drive a car into the ground and then go buy another one. Can your friend afford to get a new car? The manufacturers are hungry for sales and there's some good deals out there. Financing is really low too.

1gewehr
April 03, 2012, 10:57
You are always better off if you don't think about 'purchase price' but instead about 'total cost of ownership'.

You will almost always come out ahead by buying a 3-4 year old used car. You will have normal maintenance costs, there should be no repair costs if you get a decent car, and the resell value should be not far off the purchase price.

As noted above, a lease usually comes with a bunch of 'gotcha!' clauses. You may have limited mileage, required maintenance at the specific dealer, added costs for turn-in clean-up, must have new tires and brakes before turn-in, and a host of other things to watch out for.

With Edmunds.com, KBB.com, and other sites on the web, there is a LOT of information to allow you to compare various models for expected resell value and reliability.

Lastly, if you only need a car for a few months, you might look into renting. I did this once for four months at less than $200/month. No muss, no fuss, unlimited mileage, just turn it in with a full tank!

kroberts
April 03, 2012, 17:22
Thanks Guys

Cava3r4
April 03, 2012, 17:38
go here.
a humorous READ but it HAS GOOD INFO on dealing.
also has a part on buy vs lease. Lease is usually NOT good for the average person.

http://www.edmunds.com/car-buying/confessions-of-a-car-salesman-pg2.html