Quote:
Originally Posted by Sliver
The lessee doesn't own the car, so he can't extract any equity from it...he's been renting it. The guy financing has the potential to have equity in the car, but until one of us takes the time to track the depreciation of many cars to come up with averages it's a moot point. You're saying he wouldn't have any equity, I'm saying he might have some.
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But he has the OPTION to buy it. If his option to buy price is similar to what the total cost of financing is, then he's better off, since he can decide whether it's worth buying at that point or not.
If the car was worth 15k for some reason, he could do the buyout at 12 and be 3k ahead. If it was only worth 9k, he could give it back, and go buy a used one for 9k if he still wanted a similar vehicle.