Here’s Why Leasing a Car is Stupid

Here’s Why Leasing a Car is Better Than Buying a Car, DIY and car review with auto mechanic Scotty Kilmer. Leasing vs buying a car, which is better? Why not to buy a car. Why you should lease a car. Why not to lease a car. Should I buy or lease a car? There are pros do leasing a car but also a lot of downsides as well. Car advice. DIY car repair with Scotty Kilmer, an auto mechanic for the last 54 years.

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1. Common Sense


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[buffalokrisgoldprospecting]

Scotty you probably won't read this cuz you have so many subscribers it's probably impossible to see this but my step dad was a mechanic or the exact same jean jacket as you had the same mannerisms with his hands and was almost exactly the same as you he passed away this year from a heart attack and I miss him more than you can imagine watching your videos reminds me of him so much you are so cool Scotty never change

[jamesvalenti]

I used to inspect off lease cars for Honda, VW, Chrysler Capital, Ally Financial, and Chase Financial. The stories I could remember I inspected a guys car. It was a Honda Accord. He used it for Uber and Lyft. He had 187, 000 miles on the car...plus 8 grand worth of cosmetic damage. Now the company I worked for was a third party company. We just inspected the vehicle based on the guidelines of the finance company, but I would have loved to have heard the conversation between him and Honda Finance. I had another customer who's car had 39, 000 miles on it. Not bad....but he never changed the oil on the car....ever. When I pulled the dipstick out, it looked like those cookies you see in the middle of an ice cream cake. The guy also had 3 grand worth of body damage. Again, would have loved to have heard that conversation between him and Honda. Now with that being said, doing what I did, I would never lease a car. I would much rather own. I have had way too many things happen in my life requiring me to increase how far I have to travel. Cant do that with a leased vehicle.
However, if you must lease, here are the basic guidelines.
First off, NEVER lease from Ally (Some Chrysler products, and some GM) or Chase Financial (Subaru, Land Rover, Mazda, and Jaguar). These companies have absolutely ZERO forgiveness at the end of the lease. Every ding, chip, scratch, and scuff are all considered excessive. Ally is the worst though. We were trained to find previous body work. Even if the repair was done properly, they still charged $80/panel to the customer. Ally Financial are downright thieves. While Chase financial did not charge for previous body work (it was the only thing they didn't charge for). They charged $45/a dent, and $95/scratch.
Volkswagen is not bad. They allow 2 dents up to 2" and 2 scratches up to 2" per panel. They do charge $250 if your check engine light is on, so if its on, get it taken care of before you turn it in.
Honda Finance and Chrysler Capital are both about the same in terms of leniency. Honda allows 3 dents up to 1.5" per panel and 2 scratches up to 3" per panel. Chrysler allows 3 dents up to 2" per panel, and 3 scratches up to 2" per panel. Now with that being said, quantity does matter with dents and scratches. If you have a Honda with 4 scratches 1" long each, that will be considered excessive. Same goes with Chrysler Capital and VW. If you have 4 scratches 1" each, that will be considered excessive. Tire tread on every off lease company was the same. It had to be 4/32" or greater. Rims were different from company to company, but basically if your rim was scratched over 12" you're going to be charged for a recondition fee.
Now all that being said, if you do lease a car, and do get charged for excessive damage, take my advice and just pay the finance company to repair it. the cost to have the finance company repair it is so much lower than the cost to pay a body shop out of pocket to repair it. Currently, I work as an insurance adjuster for a major insurance company...and the difference in price is huge. For example, lets say you have a 4" scratch on your leased vehicle....the leasing company will charge about $150-200 to repair it. A body shop will charge you about $400+ depending on the shop.
The last thing I will also recommend is NEVER EVER buy a car from NYC, or the 5 boroughs. New Yorkers cannot drive. Period. End of story. And when I say New Yorkers, I mean people from the 5 boroughs. New York State is a lot like PA or VA...lots of open roads, so they know how to drive in NY State. Not only is NYC very damaging to the car mechanically, but I cannot tell you how many times I have seen a car from NYC with a clean history report, but the car was clearly repainted...horribly. I have seen so many NYC cars with mismatched paint, peeling paint, heavy fish eye and orange peel. Hell, I remember I had one car I looked at where the entire front end was poorly redone. In the front of your car, you have a main structural component called a radiator support. It is designed to crumple and absorb impact in the event of an accident..well on this particular vehicle, the radiator support was completely twisted and warped. This vehicle was a rolling safety violation. Take my advice, if you see a car from NYC, run away from it fast.

[RedBoneCoonHound]

As a business owner, leasing makes sense for my company. We don't want the asset on our books and have to deal with depreciation. It is beneficial for us to have a fixed monthly price that is fully deductible. We also don't want to repair vehicles out of warranty. Ford used to lease used cars and cover them under a warranty. That was great, but they ended the program.

[toeninja]

I owned my first vehicle for 16 years. My f150 made it through college and into my 30s. When I gave it up and felt like I was giving up a pirate ship that took me around the world on adventures. It was sad.

[kauigirl]

People who lease cars already knows and don't care. They want a new car every 2 or 3 years.

[nickmillerify]

1 thing to note is NEVER put any money down on a lease. If it gets totaled out in the first month you lose any money put down. Don’t fall for the tricks of salesman. You don’t own the car, you’re essentially renting it, pay month by month. Just because you’re a “good driver” doesn’t mean that other people are, have seen many people lose money this way

[Clorox__Bleach]

I’m an auto mechanic, and I can’t tell you how many people (probably 95%) are way overdue on services or treat the car like crap and don’t do the maintenance. I’ll give them some recommendations but not force them and they’ll say “eh it’s just a lease”. Sir it’s been 15k since your last oil change and you are leaking coolant everywhere 😂😂

[loki]

I think it really does depend.
If you don't put more than 10K miles a year and you like to always have the newest car, meaning not more than 3-4 years old. Usually never having to deal with something breaking and needing to take to mechanic. You only need to do oil changes and make sure to keep it in good condition, which most would if they finance to buy as well anyway. And if you don't have a down payment on it.
Then leasing can work out and you just make sure of what Scotty said, look up and see there is no hidden crap in the contract.

Yes you always have a monthly payment. But reality is, that for many people that is already the case. Many car loans for financing now runs 72 to 84 months. That is 6 to 7 years. I guess you can get another 6-7 years out of the car. But you could start to run into the "Need to replace that part and this part and so on". Out of warranty. The car would be 10-14 years old.

What I am getting at is that for people that would like to have a car that is basically new every 3 years, don't drive too much other than work, grocery store and occasional trip and you can get decent payments. The price for that is you don't ever have a time of a fully paid car, but you always have a "new" one.

[garyh.]

My Father started buying off lease cars in 1964. He found a lease company (not a dealer) and they had a customer that bought new Imperials every 4 years. The first one was a 1959 4 Door Hardtop a beautiful machine in Dusty Rose and every 4 years after he would get a replacement . I was 10 when he bought that car (He always paid cash) and it made me a Chrysler man . It kills me to see what has become of such a great company that was based on engineering and style.

[mxilplict]

I love these educational videos! So much knowledge being passed every day. Thank you Scotty!

[hereigoagain]

Scotty, please do more everyday finance videos! I teach in a biz school, and it is amazing how many students are blank on practical finance.

[johnsteele]

Leasing is a tax for those bad at math. Poor ppl renting a car they can't afford. It's literally the most expensive way to drive a vehicle other than renting it daily. "muh monthly payment" imagine paying $18, 000 to drive something 36, 000 mi and then repeating that over and over again.. that would be literally paying $180, 000 to drive 360, 000 miles in a typical $30, 000.00 vehicle.

[mxilplict]

It’s not stupid to lease when its a new Mercedes/BMW/VW/{Insert Non-Toyota endless money pit here} and you can’t be talked out of getting one for the vanity. And you have enough money to light on fire! 🔥.

Or if it’s a rational business expense - like a specialized vehicle that is prone to breaking or only needed for a certain period of time

[steve]

Leasing is fine. If at the end of the lease you have positive equity, but out the lease and sell it, trade it or keep on driving it. If at the end of the lease you have negative equity, toss the keys back to the dealer and it's their loss.

[illuminaughty]

I like getting my stuff at Rent-A-Center. Sometimes the repo man comes, sometimes I rent for 10 years until I own it.

[frodriguez]

This is a very thorough video. I think. It is a very good format. Keep up the good work Scotty.

[PICKLEDSUGARFOOT]

My mother has been leasing her cars for years. Everytime her lease is up someone in our family buys her leased car because she only drives to work and the grocery store. The last car I bought from her was 3 years old and had less than 8000 miles on it.. lol

[gonefishing]

Great information as usual. Scotty, the automotive expert at all points and angles. I wished I lived near him so he could work on my cars. Both of my cars are excellent. 2004 4 Runner, original owner and 2015 Toyota Avalon. Fantastic vehicles. I bought Toyota before seeing Scotty. I always knew they were very good products. Scotty is correct--they are in general the best vehicles made as far as dependability.

[Chris.Lewis]

I leased a 2022 odyssey. Drove it for 6 months, sold it to another dealership and made a grand on it plus what i paid in that 6 months to drive it. Thats how crazy the market is right now.