Lease or buy? That’s a long-running debate among folks looking to get a new car. With a purchase you have no limitations on time or mileage, but if you want to upgrade in a couple of years, you’ll have to haggle over a trade-in or selling price. Leasing takes all the mystery out of the equation, and when the lease is up, you can upgrade to something new. But mileage limitations can sometimes be difficult to live with.
That’s what makes Lincoln’s new lease deal so strange. The average person drives 12,000 to 15,000 miles a year, and that’s what most leases offer. Low-mileage leases at 10,000 or even 7,500 miles are also fairly common, offering a lower monthly cost in exchange for less vehicle wear-and-tear. However, Lincoln now has a 5,000-mile-per-year lease plan. That lowers monthly lease payments even further, but you could exceed the yearly limit in a single two-week, cross-country vacation. Is a lower payment worth such restriction?
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Cars Direct learned of this lease deal through a dealer communication, and crunched some numbers. By dropping to 5,000 miles, it’s said a vehicle's residual value would rise by five percent. As an example, Cars Direct uses a 2020 Navigator Reserve and a three-year term to determine the payment would drop by $110. Still, it’s $808 per month versus $918 and frankly, we struggle to see why anyone who can afford $800 per month wouldn’t go to $900 for considerably more mileage.
After this report came out, Cars Direct learned that Lexus was also offering a 5,000-mile lease option. It seems like these deals are likely aimed at an older demographic that simply doesn’t drive that much, like the fabled little ol’ lady who only goes to church on Sunday. It’s certainly an intriguing concept, but with penalties of $0.25 per mile over the limit from Lincoln, costs could rise in a serious hurry if you suddenly need to drive more than planned.
What’s your take on this very low-mileage lease? Is it just a gimmick, or something that could work out well for the right person?