Hi folks, I have a 2012 Prius model two. Sea glass pearl in color. It has just about 22k miles. It's a lease that ends in June 2015. I have about 5,000 left in lease payments and the purchase option is around 14 and change. I am also trying to buy a house and the bank told me I have too much debt/income ratio. I need to get rid of one of my leased vehicles. (My wife drives a 13 prius persona). Not getting rid of hers, too new and she's in love with it. lol I have two options, buy my Prius outright for 19,000 OR, eat the negative equity (about 2500 bucks) and buy a less expensive, more used car/suv. My number one option for a used car is a 2006 Toyota Avalon XLE, leather, heated seats, 74,500 miles for 12,000 dollars. Really nice car, would love to have the extra room, BUT, it's still more expensive to operate and I'm a little nervous of the higher miles on it. (not for the year, just in general). Would put me at about 14,500 when the deal is done- still cheaper than my Prius, but more miles on Avalon, also will be more to operate than Prius. I've also considered a 2009-2011 Honda Accord EX. Comes nicely equipped. Most likely 20-45,000 miles. Newer and less miles than Avalon. Haven't heard the greatest reports of that generation Accord as far as fit & finnish though. Anyone know? This car would be probably 15,000 dollars + 2500 in negative equity- I'm right around 17,500. Those are the two most sensible (used) options. Had a '94 accord which my grandfather gave me. great car, I totalled it. Any thoughts? Advice?
You seem to be living on the financial edge. I suggest you go on a crash savings plan before you attempt to buy a house. The fact that the bank will not lend you money only supports this assumption. Paying off the car at the end of the lease sound like the best option. That way you have time to save the cash for the purchase.
Man, I've have always heard that leasing is never in the favor of the lessee unless you like to drive the latest and greatest cars that come out every another year. For long term savings it doesn't make any sense. I'm sure I'll get railroaded for this saying!
Congrats on your efforts to buy a home! If you can afford it, I suggest buying out the Prius, even though it's more cash out of your pocket right now. Once you're in your new home you'll want lower overall monthly costs and the worry of not having to fix or replace an older car. Owning a home, especially if it's your first home, you will have unexpected expenses come up you weren't planning on and you don't need to worry about your cars. It seems your negative equity of $2,500 will be made up within about 2 years or so in just gas savings alone anyway. Don't listen to others who try to give you advice beyond what you're asking for. You don't need a lecture about leasing or buying a home, etc. You're doing the right thing by talking about it and recognizing that owning a home is important enough for you to consider what options you have to do what's right for your family.
