New XC70 - lease or buy

Discussion in 'Volvo C70' started by shs, Nov 27, 2003.

  1. shs

    shs Guest

    I'm about to replace my 1998 V70 with a 2004 XC70. I plan to keep it for
    about five years, probably will put 12,000 miles a year on it. Assuming I
    can the best price on a purchase price and also on a lease price, which way
    would you go? Lease or buy?

    Many thanks.
    shs, Nov 27, 2003
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  2. shs

    Roger Habeck Guest

    That question can not be answered in the abstract as you wish. Amoung the
    questions that need to be answered are: what sort of use, business or
    personal, and how much of each. Who is the lessor and what terms are
    available? What are the personal property rules in your jurisdiction? Will
    you have the right to sell the car yourself and make a windfall profit at
    the end of the lease? There are many other considerations as well. If you
    would like to email me with more information I would be glad to try and
    direct you to the answers to your question.
    Roger Habeck, Nov 27, 2003
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  3. shs

    Al Hearn Guest

    When you say you want to keep your car at least five years, this
    almost certainly says you don't want to lease. You really shouldn't
    lease for a term that is longer than the general bumper-to-bumper
    warranty which, for Volvo, is four years.

    For more details on lease vs. buy, see

    Al Hearn, Nov 29, 2003
  4. if the car is for business use (usa tax law) and you can
    deduct 100% of the lease pmt & maint it...

    if the car is for persnl / family use , i would look at
    buying it...unless cash flow is critical...then, a lease pmt
    is better / lower....but, it is worse in the long run to lease..
    unless business related and 100% business expense...imho...
    ~^ beancounter ~^, Nov 29, 2003
  5. shs

    shs Guest

    Personal use. Lessor, I assume, would be Volvo finance. And U.S. tax laws
    prevail on this one.
    shs, Nov 30, 2003
  6. shs

    Roger Habeck Guest

    If it is a typical lease/purchase such as Volvo finance, then purchase is
    usually the best deal. However, on occasion sellers will sell to the leasing
    company for less than they will sell on the market. Also, sometimes the
    leasing company will use a below market interest rate to make themselves
    more competitive. You need to be careful though, in some jurisdictions both
    the lessor AND the lessee end up paying personal property tax, this can be a
    killer. You need to pay close attention to the residual value being used. In
    some leases, you are responsible for any shortfall on residual. Usually the
    best way to lease for personal use is to use a 36 month lease with a
    guaranteed residual value. At the end of the lease you can exercise the
    purchase option and buy the car. This can work out pretty well if the deal
    is good to start with. I have leased cars for much less than I could
    purchase them, when the situation was in my favor. Work the deal both ways
    and take your best shot. Since it's for personal use, not business, the tax
    implication are negligible except for the personal property tax issue.
    Roger Habeck, Nov 30, 2003
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