TAMPA (FOX 13) - Vehicle leasing is on an up-trend, but deciding on whether to lease or buy a car can be an overwhelming process. We have some expert advice on how to decide - an negotiate - on your new ride.
“It can get confusing for people,” said Bay Area “Car Haggler,” Shawn Speigel.
He runs a business negotiating car deals. He said incredible deals have increased consumers' interest in going that route.
“I get people all the time, 'should I lease or buy?' and you have to go through some questions,” he advised.
Things to ask yourself: How many miles do I drive? How long do I plan to drive car?
The car experts at Edmunds.com crunched the numbers using a midsize family sedan, which sells for an average of $25,000.
The cheapest option "depends on the way you’re looking, short or long term," says Edmunds.com Senior Editor Matt Jones. He found leasing takes the lead, when it comes to month-by-month payments, as the cheapest option: $294 per month to lease.
The next best option for a low monthly payment is buying used, at $300 a month. And buying new is most expensive, at $400 a month.
But when Jones added up all the costs for the average time someone keeps a car - six years - buying used wins in the long-run. The savings come up to about $3,000 versus leasing, and a whopping $7,700 compared to buying new.
Dealers told FOX 13, if you’re not staying in a new car long enough, you won’t see a payoff.
“If you keep buying the car, what happens is you pay full value and tax, and then trading out early - most people are financing for anywhere up to 84 months - you don’t get into a position of positive equity until well past four to five years into the loan, depending on interest rates," explained Kuhn Honda General Manager, Allison Musante.
Remember, whether you lease or buy, always negotiate.
When you lease a car, you can negotiate more than just the price. Ask for things like more included mileage. If you go over your miles, the penalty can be steep, so this is a great way to save money down the line.
The Car Haggler also said there’s some truth to the benefits of timing. Heading to the dealership at the end of the month is typically best because it has to meet monthly quotas.
He also says be ready to act because deals don’t last.
"There might be a certain car this month, great lease, but now the manufacture takes away that bonus money, that lease cash, and it's not as good of a deal, so you have to understand these things change month to month," he said.
But it’s not always a dollar figure that drives the decision, You also need to ask yourself about yourself.
"Where are you? Are you a person who keeps a car as a personal statement," asks Edmunds' Matt Jones. "Do you want to show up at a restaurant with the fancy new car all the time? If that's you, you might want to consider leasing, but if you're the guy who says, 'I want to get the most bang for my buck over the long term,' definitely purchasing is the way to go."