Wondering if any financial savvy individuals could point out when it’s worth it to still lease vs buying with the $7500 in play.
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$7500 Tax Credit vs Lease
- Thread starter Zer0Her0
- Start date
If you are asking for responses from "financially savvy individuals", the response you will get is
"Its never really worth it to lease, unless you have a business, and are using the car lease for your business. Its even less worth it on a lease that is not subsidized heavily by the car manufacturer. Couple that with the fact that you currently can not buy out model 3 and Y leases and from a financial perspective only, they make no sense whatsoever.
There are other reasons you might want to lease the vehicle, but since you are calling out the $7500 tax credit, the assumption is you are talking about financially, and financially, it makes very little sense to lease a model 3 or Y".
"Its never really worth it to lease, unless you have a business, and are using the car lease for your business. Its even less worth it on a lease that is not subsidized heavily by the car manufacturer. Couple that with the fact that you currently can not buy out model 3 and Y leases and from a financial perspective only, they make no sense whatsoever.
There are other reasons you might want to lease the vehicle, but since you are calling out the $7500 tax credit, the assumption is you are talking about financially, and financially, it makes very little sense to lease a model 3 or Y".
Getting a Tesla is not financially savy in general. But purchasing for tax credit makes the most sense right now in my opinion.
if you lease, the $7500 credit goes to the manufacturer/dealer, so they would have to adjust their lease rates down accordingly. I don’t think Tesla had adjusted lease rates down to account for this. I don’t know about other brands.
If you can qualify for the credit thru purchase and vehicle qualifies, then that would would be way to go for a Tesla.
If you can qualify for the credit thru purchase and vehicle qualifies, then that would would be way to go for a Tesla.
So would I have to contact Tesla to apply the credit accordingly? I really want to lease
E90alex
Active Member
No. Tesla doesn’t detail the lease numbers for you, you just have the monthly payment. Eg cap cost, residual value, money factor.
No, it doesnt work that way. Tesla may or may not offer some or all of the lease credit to the person leasing the vehicle, at their choice. You dont contact them to apply it, they either choose to apply it to everyones lease in some form (subsidized money factor, cap cost reduction etc) or they dont. You take the terms that are there, and thats it. There is no "contact them to apply it."
Yea I spoke with them and they only will apply it to purchased cars. totally different from all others who are offering it only on leases
ATPMSD
Active Member
Totally disagree, but leasing only works if you fall within a narrow set of criteria:
1. You normally replace the car with a new one about ever 3-years
2. You drive less than 12,000 miles / year
3. You are willing to properly maintain the vehicle
4. You take care of the car so it is not all dented by the end of the lease
Someone who does this is always driving a new car, and that car is always under warranty. If such a person buys the car their payments are greater and in order to flip the car the value of car at the end of 3-years needs to match the payoff.
The whole question from the OP was "financially" and it is never financially savvy to replace cars every 3 years.
I leased BMWs myself for almost 20 years prior to getting my model 3, and I used to be one of the main people providing leasing advice on a large BMW website, helping people evaluate lease deals, so I am not specifically against leasing.
From a financial perspective however, they usually dont make sense unless you are changing cars every 2-3 years (which is not financially smart but may be something someone wants to do anyway), and you dont end up with a lot of lease end charges.
The "drive under 12k miles a year" thing being something that is necessary for leasing is another one of those "forum fallacies", for the most part. The mileage charge for additional miles is usually less than the cost of depreciation for the same miles, so many times leasing works out cheaper for business users who are driving 15k, 18k or sometimes even more, as long as they are not driving out the new car warranty within the lease (50k miles in 3 years, for most brands).
If one is determined to have a new car every 3 years, for some cars, leasing is an attractive option when its subsidized by the manufacturer (overly optimistic, high residual values), and you negotiate a good deal on the purchase price. Teslas dont fit in either of those categories, and even with that, the OP said they wanted "financially savvy" opinions.
From a purely financial point of view, changing cars every 3 years is not something someone should do. With that being said, not everything has to be driving by purely finances, so for some people it makes them happy to have a new car every 3 years, so thats what they should do. Doesnt make it financially savvy but if it makes them happy, thats more than enough.
ATPMSD
Active Member
I have driven a new car for 40+ years because I lease and I have been very happy. If you want to argue financial prudence, then no one would buy a luxury or sports car. 
I like the idea of changing cars every 3 years and not being upside down when going to trade in. I luckily was only 1K upside down when I sold my X5
I drive less than 12K miles and keep care of the car. But this $7500 is huge when it comes to my tax bill
I drive less than 12K miles and keep care of the car. But this $7500 is huge when it comes to my tax bill
I have driven a new car for 40+ years because I lease and I have been very happy. If you want to argue financial prudence, then no one would buy a luxury or sports car.
Right.. but the OP asked " what would financially savvy people say" and I answered them with what that answer would be. The whole premise is off, since the OP obviously already made the decision to lease, so I am not sure what the purpose of the thread actually is.
Actually I haven’t made that decision. I leased my other MYLR and I’ve decided will be purchasing this one to take full advantage of the tax credit. I’m hoping I timed it right where once my MYLR is up (Oct 2024), my Ocean Extreme will be ready
I am also trying to decide if I should lease or buy. If I buy I would only get to utilize $2-3K on the tax credit, not the full $7,500.
I drive 10K miles or less a year over the past 5 years. I always take good care of my vehicles. It would be for business, so I could write off the lease payments. Another reason why I was leaning towards a lease is because I was hoping that by the time the lease is up interest rates will have hopefully come down.
What are your thoughts?
I drive 10K miles or less a year over the past 5 years. I always take good care of my vehicles. It would be for business, so I could write off the lease payments. Another reason why I was leaning towards a lease is because I was hoping that by the time the lease is up interest rates will have hopefully come down.
What are your thoughts?
That some version of this exact discussion has taken place countless numbers of times across every car forum ever created, and there is no concrete answer. Do what works for you.
Ciaopec
Active Member
This, of course, presupposes that you have greater than a $7500 tax bill. Otherwise your credit is only as large as your tax bill. But you knew that.
SageBrush
REJECT Fascism
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