Car Lease vs Buy

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Cars Buy v.s. Lease
Brent Groom
David Tran
Luu Tran
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Presentation Topics

• Lease vs. Buy Comparison
• Sensitivity Analysis
• Decision
• Resources

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Lease vs. Buy Comparison

• Basic Assumptions for 5 years

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Leasing vs. Buying

• Basic Research Results
• for the Toyota Camry V6 LE

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Leasing vs. Buying

• Basic Research Results

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Leasing vs. Buying

• Basic Calculated Results

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Analysis
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Analysis
Toyota Camry LE V6 Cash Flow Diagram
Buying(cal)
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Sensitivity Analysis

• Variables
• - Down Payment
• - Leasing term (n)
• - Mileage

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Sensitivity Analysis

• Varying Down Payment

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Sensitivity Analysis

• Varying term

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Sensitivity Analysis

• Varying the over mileages

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Decision

• Lease or buy, which one is better?
• - Lease allow lower monthly payment, always
  under warranty, and drive new car every 2 or 3
  years.
• - Buy allow payment free for a while, resale
  the car, and able to upgrade
• Secret price quote.
• Cost of the car that is below the dealer invoice

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Decision

• Monthly cost analysis Using EUAC
• Buying 334
• Leasing 334
• Another way of looking at it

In order to make 8800 in 60 months, need
interest rate of .005058 or the nominal interest
rate of 6.07, which is the same as buying.
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Leasing Formulas

• Residual 60 (MSRP)
• Net cap cost Negotiate price - down
• Depreciation (Net cap cost residual) / n
• Finance (Net cap cost residual) money factor
• PMT Depreciation Finance Tax

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Resources
For new/used car comparison http//www.autos.ya
hoo.com For information how to lease or buy
http//www.leaseguide.com For the Secret
Price Quote http//www.carpricesecrets.com For
Salvalge value and car price http//www.kbb.co
m// http//www.edmunds.com/ http//www.cars.co
m/go/index.jsp?affnational http//www.leasecomp
are.com/
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Car- Lease v.s Buy
The End