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Posted in Auto Loans
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Question By
Tate26

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How do I decide to lease vs buy a car?
My parents bought me a car a few years ago and the head gaskets blew last month. We do not owe on this car anymore (luckily). I've thought about repairing it but its 14 years old and I think once it's repaired, other things will start to break. SO, I'm looking into new cars. Originally, my gut told me to buy a 2-3 year old used car with as low of miles as I could get. Now, leases are looking pretty attractive. My credit score is 730. I have 2 credit cards, one paid off and the other with an $800 balance (max is $1500... eee), but have been making consistent payments on it of at least $100/month.
I do not make much money-- less than 30k/yr. I want a monthly payment of around $200, less if possible obviously. I can lease an $18000 car for $200/month or I can buy a $12000 car for probably like $250/month. I am worried with the used car that it will need new brakes, new tires, etc soon after purchasing, which will be very difficult for me to afford.
How do I choose? The lease is so attractive. I would want a lease that covers 12,000 miles a year. I keep my cars very clean and keep up on regular maintenance like oil changes very well. I could also consider buying it at the end of the lease term.

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Top Contributor
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If you buy a good used car that is one to two years old, you should have a very servicable vehicle for the next ten years and you will have saved thousands of dollars.  I did that in 2005 (vehicle was a year old, formerly a rental) and it's still a reliable car. 

Leases may make sense for some businesses since they can deduct the lease costs from their taxes, but they are not a smart choice for the average consumer.  There are often mileage restrictions and leases last for a specified amount of time, after which you do noit have any trade-in value and you have to start the process all over again.

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