Jack Kelsoe

I am sure this has been discussed before, but can anyone give some advice on the pros and cons of each.<br>I've had company cars for years and am about to take a job in which a car is not provided. <br>As a German car lover, (I've owned VW GTI's up until 4 yrs ago), I have my heart set on the A4. <br>As a consultant, I do travel for work and am currently averaging 15-20,000 mi per year.<br>I will be compensated for travel with either a $500/month car allowance + gas or simply $0.31/mi.<br>This is still up for negotiation.<br>At this time, I don't think I can afford to outright buy a new A4, but could afford the $299 lease or buy used.<p>Thanks for your thoughts.<p>-jk<br>

Dale B

I saw an ad in the Portland, OR paper with some examples of that lease deal. There, at least, it has a 10,000 mile per year limit. If you go over this (for example, having over 30K miles at the end of the 3 year lease) then you pay a per mile charge for the excess. This is usually at least 10 cents per mile. If you put on 50,000 mile in your 3 years, that would mean 20,000 miles times 10 cents, or $2000 due. Of course, the lease deal can be negotiated up-front to allow the extra miles, but it will cost you more per month. I am just guessing at $50 per month additional. (It wouldn't be too much over that or it would be cheaper just to pay the "fine" at the end of the lease).<p>Leasing advantages: relatively low payment to get into a decent car. No hassle in selling the car at the end of the lease. Possibility of buying the car, if it has been good to you and you like it, at the end of the lease.<p>Leasing disadvantages: Your payment is going toward interest and depreciation of the car only, you are building no equity in anything. If the car turns out to be a near-lemon, your stuck with it for the lease term. (If it truly qualifies legally as a lemon, you might be able to get out of the lease). You still have to maintain the car just like you would if you owned it, generally better, actually. While if you owned the car you could choose to ignore a dent or big scratch in the body or a tear in the interior, with a lease you will be charged for fixing that stuff as "excess wear and tear."<p>Used buying advantages: Somebody else has already taken the loss for initial depreciation of the car. You can get a better buy as a result.<p>Used disadvantages: You have to wonder why the car was sold. Did it have repair problems? (You might be able to find a nice one coming off a lease that would help eliminate some of this uncertainty). It's not new, and has some degree of mechanical and cosmetic wear. You will have to judge the importance of this. You don't know if the used car was used responsibly or abused. Was it ever in a serious wreck? Used A4s aren't always that easy to find, and they are about impossible to find if you are picky about colors, engines, transmissions, and particularly other options? Used A4's are doing pretty good at depreciating less than the average car, which means they are not a bargain used, but you still save a lot of money over new. If you want to know what a used one should sell for, ignore Kelley blue book and probably NADA book also. They are inflated. Actually, if you figure a price on one that is a year older than you are looking at, that should be closer to the real figure. You can also go to www.traderonline.com to see asking prices of used models.<p>In my opinion, I think that if you can take your time and find the "perfect" used A4, that would be the best deal for you. There are also some great deals being offered on leftover 98 models. You can get around invoice price on one A payment of $636 applies to financing $31,000 for 5 years at 8.5%, for reference purposes. That's around invoice for a pretty well equipped V6 Quattro model. That's over your allowance of $500, but not too far off. If you dropped "down" to the 1.8T model without Quattro, you might be at $500 or so.<p>Hope this helped a little. Everybody's opinion is different on these issues, and I could have written many more pages. There's almost no end to the list of advantages/disadvantages that one could come up with.<p>Good Luck!<p>Dale

klidge

If you lease, you'll have to pay for a lot of excess mileage when the lease is up. <p>If you buy used, you'll have a car that will have a shorter warranty, may (or may not) have problems, and your choice of options and colors will be more limited. <p>If you buy new, you will have to come up with enough cash for a down payment so that your loan amount is 25k, which at 7.5% for 60 months comes to a monthly payment of $500, same as your company car allowance.<p>Figure out which situation is easiest to live with, then go ahead with it.

Dale B

Down payment requirements vary by the place that finances the car. My credit union, for example will finance 100% of the purchase price, plus tax and license (that amounts to over 10% of the price in addition), for up to 72 months for 6.35% interest, with no gimmicks. So there isn't necessarily any down payment. The 100% of the purchase price can even be higher than retail if that's what the dealer charges.<p>You brought up a good point on warranty, though, that I forgot to mention. And buyers should keep in mind that the Audi warranty includes all required maintenance.<p>Dale

sk

I am selling my 1-year old A4 1.8Tm, 6500 miles. Anything higher than 22.5k would get it (that's what I was offered by other dealer for it as a trade-in).

klidge

I understand. My point was based on the assumption that he'd want to keep his monthly payment limited to the amount of his car allowance.

jack k

<br>You guys ever hear of a dealer writing off the excess mileage if the leasee chooses to simply turn in the car and lease a new one?<br>Kind of deal maker for the salesperson, I assume.<p>This was mentioned to me as a possibility, but I'd like to hear clarification?

JIM H.

This is one of the most common fallacies of leasing. Either a dealer will KNOW how many extra miles you have racked up x $.15, and builds it into the new lease, or, as has happened with A4s in the last few years, the value of the car at lease-end, even with a few extra miles on it, is greater that the residual which was projected three years ago.

JIM H.

1) Almost any bank will REQUIRE a 15-20% down payment to finance a used car.<br>2) Used car interest rates are considerably higher than new rates.<br>3) You can't get the same loan term for a used car as a new.<p>If you consider these three points, combined with the fact that used A4s hold their value real well, meaning that the relative purchase price won't be cheap enough to overcome these three factors, it sounds like a new 1.8Q @ $350-$380/mo.<br>w/~$1300~ down is the answer.

JIM H.

~$1300.~in start-ups,not down payment;Sorry!nt