Putnam Leasing?

If it's a nice vehicle and you intend to keep it, I would say owning makes far more sense than leasing any day of the week.

I don't know anyone who would keep a car loan for 12 years, and you certainly have the option to pre-pay the note.

If the 12 year is with Woodside, I highly recommend using them. Very professional and first class.

As to the lease, if you go that way, when the lease is up you have nothing and you give the car back +/-.

I would highly recommend Putnam for the lease if you chose to do that. They are first class as well.

It depends upon whether you are asset based as to whether you buy or lease.

 

DONT EVER EVER EVER EVER EVER EVER EVER LEASE A USED CAR! ESPECIALLY AN EXOTIC.


That is all.

 

Ditto - If you can't afford to own it - how can you afford to insure-drive and fix it?

 

Leasing can have advantages for business purposes more than individual reasons.

Saves your line of credit and the lease does not appear on your credit report.

So, it's advantageous in that it does not affect your credit lines.

Not the best statement to say "never" so emphatically as it is not fully accurate. Leasing has nothing to do with the ability to afford the vehicle.

Leasing becomes a matter of using $ differently.

 

I currently lease my 360 spider under my business with Premier. I do it for the exact reasons listed above, tax purposes and credit lines. I leased my 355 as well. If you are going to put down 50k (what model are you looking at?) the difference from purchase to residual should be fairly low and you could probably have a very low payment. As noted above just because one choses to lease it, doesn't mean you can't afford it, its just using $ in a different matter.

 

There are also bank programs designed for high end cars. They work like a lease but you have equity in the car. If the car is 200k, you put down 50k for example and what would normally be the residual value of a lease is actually a baloon payment at the end of the term so your financing the difference between 150k (200 less your deposit) and what would be a residual, say 100k in 5 years so your actually financing about 50k and your payments are based on such. The key is that the value of the car does not fall below what the baloon payment is. This way, you have flexiblity if you want to get out of the car, where as leases are much harder to get out of.

I think Chase offers a program like this.

 

That's essentially the deal I have w/Putnam, where it is nominally a lease.

By the way, I don't understand all the antipathy to financing. It's a tool. It's not always the right tool and it's easy to misuse, but financing is only bad the way guns are bad. With my car, I borrowed far less than the max from Putnam. This means I won't be upside down with them when I prepay the lease. I also kept my payments low. Nothing wrong with that, I think.

 

comes down to the tax-man. fo sho.

I can't afford to lease one anyway, but I can, and have, leased lesser cars I didn't plan to keep, let someone else worry about what it's worth in 3 years, deduct every penny.

 

With high end leases you DO have to worry about what its worth at the end. My understanding is that you PICK what residual you want. If the car is trully worth less, you are on the hook for the difference. Leasing a lambo is not the same as leasing an F150.

 

was not aware of that... interesting.

I've never leased an F150.... just BMWs... I came out way ahead on both. (flipped one early when it hadn't devalued at all, had one for full term and the bottom fell out from underneath it, they were stuck with being $4k upside down.

even with the "you choose the residual", if you do ANY homework, I should think it quite simple to do.

especially with the well established and documented secondary markets that ferrari enjoys... not sure that Lambo and the like have something as well-established.

either way, it's still worth considering for many folks.

 

Does anybody write-off their Ferrari lease? And if so, how does this work and do you really save money in the end? I just got started in commercial real estate brokerage and am learning about tax write-offs as I am technically "self-employed". Another broker told me that the best way to do it is to create an S-corp through which you write all your business checks...any input would be greatly appreciated

 

This discussion should be moved to bus. and investing, honestly.

an S-corp is great until you get caught. for what you do (and me, for that matter) the IRS will eat you alive if they come knocking.

now. a single-owner LLC, that makes sense (I'm in the middle of it right now).

but even without that overriding structure, you can still, as self-employed, deduct a host of expenses that would otherwise not be available. my car, for instance.... 70% of every penny I spend on it comes off before self-emplyment tax, eventually, the business will own the car and I'll be able to knock down all of it as a deduction (not huge right now as its paid for).

With a car like a ferrari, it can get a little sketchier, but is still doable, for sure. you'll just want to be sure and take some allowance for personal use.

this discussion is huge, and has a million "ifs" and I'm sure its been hashed out on this forum more than once...

 

These open end lease agreement are basically the same as renting a car.

 

I dont remember or didnt see it above, but yes leasing a car does show on your credit. It counts as an open auto towards you. I just got done being a finance manager for a car dealership. So there you have it, keep this in mind if you want to own other cars as well and want to finance them or lease.

-retsof

 

"I dont remember or didnt see it above, but yes leasing a car does show on your credit"

This is not so with Putnam's leases but could be with other lease companies. Putnam will certainly check your credit, and the higher your FICO the better the deal you get. You need to be above 720 to get the good deals.

I believe Woodside won't provide financing unless you are over 720 as well.

However, Putnam's lease would only appear on your credit report if you were in arrears according to Putnam.

It's possible other lease companies do report but Putnam says they do not. They say that most of their customers are business oriented and do not want their credit lines affected.

So, it depends upon each individual situation and how your $ is used and how you want to structure what you want to do.

 

I like to own my toys eventually so I'd rather finance the purchase. I also put $50 down but I borrowed the rest at an interest only loan without any fixed payment towards principal. I did agree to pay roughly 1/3 of the outstanding debt each year and whatever was left at the end of the 3rd year becomes a balloon payment at the end. I own my a couple of businesses but don't take the deduction on the 360 in the business as its a personal car and I would have no way to explain how I use a 360 coupe on construction sites. The business pays for the other family cars though. Even at the loan's peak, my actual payment was only around $400.00 a month. I throw a thousand here or there or close on a deal and pay 5K and sometimes I paid just the interest for sevaral months. I have a big deal closing in a couple of weeks and the balance will be paid off just in time for a little more borrowing and a new F430. Just my .02

 

That's creative financing, Brett.

Moves like this will definitely boost your FICO, and high credit scores are critical to good deals.

The bottom line is that it doesn't matter how you do the deal. It has to follow one's regular guidelines, and it has to be affordable.

It's certainly understable what John C. said. However, that approach really does not apply to every situation. I agree that many are sucked into leasing to make the deal easy, but for those that are savvy, you can structure a workable deal and one can end up owning the vehicle.

 

really its all about how you and your banker get along. Building relationships with a lender who is also a friend makes things soooooo much easier.

 

Hey way to pat yourself on the back, If what you are saying is true why are you even debating this. You dont need all these e-experts advice if you can pay what ever your dlr is charging w/out even missing it.