Retail or Leasing Financing

[WeaponX]

Ask ko lang po. Yung friend ko kasi tried visiting toyota.com.ph. Balak kasing bumili ng Avanza yung 1.5A/T and dun sa website may two options for financing, Retail and Leasing.

Granted na sa Toyota ang financing, ano ba dapat nyang piliin? Alin mas okay sa dalawa? Di ba yung Leasing is parang rent to own sya? By the way, nag try akong maglagay ng figures. 400K downpayment for Retail then 400K security deposit for Leasing, all 4 years to pay yung balance. It turns out na mas mura ng kaunti yung leasing. Eto nga pala yung exact URL:

http://www.toyotafinancial.ph/index....=11&variant=54

Please, kindly suggest na rin kung ano pang ibang magandang options sa pagbili. My friend has 400K+ pesos for downpayment. First time lang na bibili ng sasakyan.

TIA

[OTEP]

Don't know much about leasing. Read the terms. Sa U.S. parang rent talaga siya with mileage limitations, etc. Then you have the option to buy the unit at the end of the term.

If you want to save on financing, getting in-house financing is probably the worst thing you could do. Banks offer better terms. Ang layo ng computation ng Wheels in-house vs. BPI C3 dun sa Picanto last year.

[redorange]

As a general rule if you like to change cars every two years or so and don't want to have the hassle of selling the vehicle then leasing may be better. That is assuming that you don't mind having nothing to show for after two years of payments for a vehicle. You also have restrictions as far as mileage per year with anything going over the set limit being charged at a per mile basis. Leasing is just another term for renting the vehicle from the dealer so that you can have a new car after two years without having to worry about selling the car. Keep in mind also that any modification made to the vehicle needs to be removed and there should be no damage to any parts or you will have to pay to get it back to it's original condition. After the terms of the contract you the leaser have the option of purchasing the car at the depreciated value of the car set by the dealer.

I would not suggest leasing to anyone if they can afford to buy the car because at the end of the terms you have nothing for all the payments you made. Should you decide to putchase the car later it would be more expensive since you have to consider the payments you made for two years prior to the decision to purchase.

[1D4LV]

all posts are correct....
to sum it up....

a) leasing is like renting.... you get to use a property or a vehicle for a certain period of years (the leasing period), for a certain amount....at the end of the contract, you have the option to get the vehicle (or the property) less than the accumulated amount of what you've paid plus certain add-ons based on their factor tables, taxes, etc.

b) financing is paying it in installment. once you've been finished with the payment, the property or the vehicle is yours.

i would go by with redorange's statement. kung ok lang sa iyo magbayad and at the end of the period, with no asset to show as well as if you are planning to change cars every year or every two years, leasing is better.

but if you would be wanting otherwise, then go for financing.

[br733]

i believe the main difference between leasing and financing is with the tax implication.

when you say leasing, which implies that it is a form of rent, the entire monthly payment (principal and interest) is deducted as an expense of an organization.

whereas if it was financing, only the interest portion of the monthly payment can be deducted as an expense of an organization.

[WeaponX]

Muntik ko ng makalimutan ito. Thanks sa mga nag-reply. Nabasa na ng friend ko yung tungkol dito and I hope na makapagdecide na sya within this year.

Muli, maraming salamat po!

[n2knee]

i believe the main difference between leasing and financing is with the tax implication.

when you say leasing, which implies that it is a form of rent, the entire monthly payment (principal and interest) is deducted as an expense of an organization.

whereas if it was financing, only the interest portion of the monthly payment can be deducted as an expense of an organization.

that only applies if the car will be used for business. then you will have to determine if the car will be used for business 100% of the time or 50% or 75% then another set of calculations will have to be performed.

to those of you who are opting for the "lease-to-own" type of contracts, make sure to find out the residual value of the car. that will be the value you will have to pay at the end of lease term if you decide to buy the vehicle.

seven or eight years ago (if memory serves me right), "lease-to-own" type of contracts were non-existent. this was created by dealership's in-house financing depts. in order to move their expensive inventories. this type of creative financing helps car buyers afford a vehicle that they normally can't afford to buy under the normal retail financing contracts.