Car Buying

When Buying a Used Car Makes More Sense Than Leasing a New One

RELATED INVENTORY
Saving this vehicle to yourMy Autotrader account
Are you sure you want to delete?
Used 2014 Audi A4 2.0T Premium Plus quattro Sdn
Used 2014 Audi A4
$18,979
RELATED READING
See all Audi A4 articles
RESEARCH BY MAKE
Toyota cars, trucks and SUVs Ford cars, trucks and SUVs Honda cars, trucks and SUVs Chevrolet cars, trucks and SUVs Jeep cars, trucks and SUVs Nissan cars, trucks and SUVs Lexus cars, trucks and SUVs Volkswagen cars, trucks and SUVs Audi cars, trucks and SUVs
Acura cars, trucks and SUVs Alfa Romeo cars, trucks and SUVs AMC cars, trucks and SUVs Aston Martin cars, trucks and SUVs Audi cars, trucks and SUVs Bentley cars, trucks and SUVs BMW cars, trucks and SUVs Bugatti cars, trucks and SUVs Buick cars, trucks and SUVs Cadillac cars, trucks and SUVs Chevrolet cars, trucks and SUVs Chrysler cars, trucks and SUVs Daewoo cars, trucks and SUVs Datsun cars, trucks and SUVs DeLorean cars, trucks and SUVs Dodge cars, trucks and SUVs Eagle cars, trucks and SUVs Ferrari cars, trucks and SUVs FIAT cars, trucks and SUVs Fisker cars, trucks and SUVs Ford cars, trucks and SUVs Freightliner cars, trucks and SUVs Genesis cars, trucks and SUVs Geo cars, trucks and SUVs GMC cars, trucks and SUVs Honda cars, trucks and SUVs HUMMER cars, trucks and SUVs Hyundai cars, trucks and SUVs INFINITI cars, trucks and SUVs Isuzu cars, trucks and SUVs Jaguar cars, trucks and SUVs Jeep cars, trucks and SUVs Kia cars, trucks and SUVs Lamborghini cars, trucks and SUVs Land Rover cars, trucks and SUVs Lexus cars, trucks and SUVs Lincoln cars, trucks and SUVs Lotus cars, trucks and SUVs Maserati cars, trucks and SUVs Maybach cars, trucks and SUVs Mazda cars, trucks and SUVs McLaren cars, trucks and SUVs Mercedes-Benz cars, trucks and SUVs Mercury cars, trucks and SUVs MINI cars, trucks and SUVs Mitsubishi cars, trucks and SUVs Nissan cars, trucks and SUVs Oldsmobile cars, trucks and SUVs Plymouth cars, trucks and SUVs Pontiac cars, trucks and SUVs Porsche cars, trucks and SUVs RAM cars, trucks and SUVs Rolls-Royce cars, trucks and SUVs Saab cars, trucks and SUVs Saturn cars, trucks and SUVs Scion cars, trucks and SUVs smart cars, trucks and SUVs SRT cars, trucks and SUVs Subaru cars, trucks and SUVs Suzuki cars, trucks and SUVs Tesla cars, trucks and SUVs Toyota cars, trucks and SUVs Volkswagen cars, trucks and SUVs Volvo cars, trucks and SUVs Yugo cars, trucks and SUVs
RESEARCH BY STYLE
AWD/4WD
Commercial
Convertible
Coupe
Hatchback
Hybrid/Electric
Luxury
Sedan
SUV/Crossover
Truck
Van/Minivan
Wagon
ADDITIONAL MODEL INFORMATION

author photo by Russ Heaps September 2016

When does buying a used car make more sense than leasing a new one for the average consumer? Well, almost always; as in, nearly every time, more often than not and 99 out of 100 times.

Don't get us wrong, there's nothing sinister about leasing, particularly when you're attempting to bring monthly car payments in line with your budget. There are just more sensible ways than leasing new to drive the vehicle you need. Need being the operative word.

Why Do Most Leasers Lease?

If you ask the average Joe why he leases, he'll probably tell you some version of more bang for the buck. And, it's probably true. Because you're really just renting the vehicle from the leasing company for a fixed amount of time, you only pay for the value it loses (plus some assorted fees) while it's in your hands.

A new 2016 Audi A6 Premium Plus 3.0 retails for $58,325 with a destination charge. After $5,740 down, Audi will lease the car to you for $605 per month for 36 months. They'll finance the same car with the same downstroke for 60 months at $966 per month. No question, $361 is a huge monthly savings for most of us. So, as far as monthly payments go, leasing new beats financing new.

Get Over Yourself

The first thing you need to do when you consider replacing that old heap in your driveway is have a good ol' heart-to-heart with yourself about living within your means. Unless you're a one-percenter, who could pay cash for the car of your dreams if you wanted to, you're going to have to finance or lease. You're an average Joe, remember.

While cruising around in a brand-new $58,000 luxury sedan would be cool, does it make sense for you, even at $605 per month? If you find yourself trying to figure out which current extras in your life you might be willing to do without to come up with the monthly lease or loan payment, you're looking at too much car. Period. If you consider giving up your weekly date night with your spouse, or washing and ironing your clothes rather than sending them to the dry cleaner, you're looking at too much car. Period.

Leasing Is Renting

We won't wade into all the details of leasing here, but just keep in mind, leasing is renting. You pay to use the vehicle, and at the end of the contract period, if you managed to keep within the 12,000-miles-per-year mileage limit and the vehicle is in as good of shape when you return it as it was when you drove it off the dealer lot, you turn in the keys and walk away. That $5,740 down payment and $21,780 in monthly payments simply disappear. You've got nothing to show for it and nothing to put down on your next car.

Lower Your Sights

Try this on, instead. Buy certified pre-owned (CPO). These used cars are certified by the carmakers, usually with some type of carmaker-backed warranty. Used? That's not cool! Maybe not, but it makes sense. You can find a CPO 2014 Audi A4 Premium Plus for about $28,000. With a down payment of $2,800, you're left with $25,200 to finance. According to Bankrate, the current interest rate on a 60-month, used-car loan is roughly 3 percent. Your monthly payment would be about $453.

It's less car, and it's a used car, but at the end of 5 years, you'd own it, and it'd still be worth about $7,000. This is equity you can use as a down payment on your next car.

What it means to you: If you're considering leasing to drive more car than you can afford to finance, step away and think about buying CPO instead. Less car with lower payments and some equity on the back end. What's left to think about?

RELATED INVENTORY
Saving this vehicle to yourMy Autotrader account
Are you sure you want to delete?
Used 2014 Audi A4 2.0T Premium Plus quattro Sdn
Used 2014 Audi A4
$18,979
This image is a stock photo and is not an exact representation of any vehicle offered for sale. Advertised vehicles of this model may have styling, trim levels, colors and optional equipment that differ from the stock photo.
When Buying a Used Car Makes More Sense Than Leasing a New One - Autotrader