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Should i lease or Buy a range rover sport.

5K views 21 replies 10 participants last post by  Holeecow 
I am floored someone would think of not having "full" insurance coverage on a financed car. First of all the bank will almost definitely make you carry comprehensive/collision not just liability. Also, if you owe $50k and the car is stolen or you get in a accident that is not your fault, without full/collision/comp coverage you would still owe the bank all the payments. In fact if somehow you get by with a unwise/cheap coverage scheme and something does happen, the bank (now without either full collateral if damaged/un-driveable, or ANY collateral if stolen/totaled), if at all legally entitled to, will call the ENTIRE outstanding balance or put you into default! Even if that doesn't happen, you would be stuck making all the payments and no longer having a car!

Now, even if you have full coverage, you STILL want to ensure you have what is called GAP coverage. If you buy a new car for $80k and total it 6 months later, the value of it is probably $65k (its used and has maybe 10k miles, may be a model year older too). That is what you will be paid, but if paying maybe $1k per month in principal you will still owe $9k more than the insurance company will pay your bank. GAP coverage will cover this difference.

Finally, in TX, you pay sales tax on the full price of the car when leasing, up front. This is because the DEALER takes ownership from the manufacturer and at any change of ownership due to a sale (not inheritance/gift), taxes are due. Maybe you can roll it into the monthly payments but that will involve interest. Then, if you want to buy the car at lease-end, you pay sales tax AGAIN on the residual!!! So, anyone who cannot write off a lease in TX and gets one is a moron, and even if you can write it off, well that doesn't make it free! "It's a write off" as a (often sole) defense for spending money doesn't usually come out of a smart person's mouth! (I am a CFP® by the way)

Now, taking OVER a lease is TX CAN be a good deal, since there is no change of ownership. Just did that to get a 2016 Corolla for our au pair, with 17 months left and only 5/36k miles. No taxes due, just minimal registration costs and a nominal fee to Toyota. it was sort of a PITA though... more because of Toyota's process.
 
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