Some thoughts and questions on LTO (lease to own) deals

Inshur

marcusguber

Well-Known Member
Ive been looking at the lease to own deals of a few places and wondering if they are worth it. Im doing the math and either most are seriously overpriced or Im missing something. Anyone have any experience with these deals? Im just wondering are they hoping that people dont do the math and just think of the weekly payment? Is there any place known that gives a decent deal or is the whole business the same as every other livery related in NYC, with the f*ck the driver mentality.

Take this one from FTL's ad

2014 Nissan Altima/Hyundai Sonata - starting at $295 per week + $495 deposit + 2 years

My numbers are for an Altima:

Im figuring this is $31175 total paid to them, for a car that is suggested retail of just over 13.5k with 50k miles on it. Now this price is KBB and isnt taking into account that this thing has been used for Uber as a rental. That leaves $17490 for insurance and what? Maintenance is on the driver with LTO. And this is one of the better ones from what I am seeing.

This one from American Lease's ad is worse imho.

2015 Nissan Altima - $300 per week + $0 deposit + 3.5 years

This comes to $54600 with a suggested retail of $16347 (figuring approx 30k miles and again KBB) leaving $38253 for what? I understand theres interest and they gotta make money but this seems usurious. How is insurance costing almost 11k per year?

I get that these are car dealers and I shouldnt expect much but Im curious if anyone has any advice to offer or a place I should check out. My issue is shit credit and not much cash to work (no down payment for ins, or a car) with at the moment so these seem to kill a few birds with one stone since I need a new car (my car is very old), and I have other uses for the car to generate income aside from Uber, some private work being fed from a friend's company, and itll also further my PC repair business's need for transportation. I could try to buy something without commercial TLC plates for no money down but in the end the full coverage will cost me a fortune (close to commercial ins prices) since I havent had a car insured in my name for years so Ill pay the penalty for that for a year or so and Ill have nothing to show for it, while I understand driving Uber, etc is a car killer Im pretty easy on a car and would baby this one since it'll end up mine in 2 years (my desired term of servitude) so it seems this might solve a bunch of problems at once for me. Any guidance aside from the obvious negativity over Uber in general?
 

Slow Joe

Active Member
If your credit sucks and you have no cash, unfortunately lease to own may be your best bet. It sucks, but I can think of no better option.

Okay, maybe ONE better option, though it still sucks: renting. Renting is more expensive, but it is temporary. Rent and work your ass off until you have enough cash to put down on a cheap used hybrid.
 

ubershiza

Well-Known Member
If your credit sucks and you have no cash, unfortunately lease to own may be your best bet. It sucks, but I can think of no better option.

Okay, maybe ONE better option, though it still sucks: renting. Renting is more expensive, but it is temporary. Rent and work your ass off until you have enough cash to put down on a cheap used hybrid.
Yellow is still an option that you didn't consider, but you'll be working a 12 hr shift.
 

Slow Joe

Active Member
Yellow is still an option that you didn't consider, but you'll be working a 12 hr shift.
That's true. But if he's like me and doesn't know the city that well and prefers the apps, yellow isn't really an option.

I honestly have a lot of respect for yellow; I don't think I've earned the right to drive it yet.
 

marcusguber

Well-Known Member
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  • #9
That's true. But if he's like me and doesn't know the city that well and prefers the apps, yellow isn't really an option.

I honestly have a lot of respect for yellow; I don't think I've earned the right to drive it yet.
Ive driven yellow and had my hack lic for a long time but I dont want and cant be locked into 12 hour shifts, I need flexibility.
 

Lenny_yellow_cab

Well-Known Member
My cousins did a LTO.... new honda accord sport... $475 a week for 120 weeks. Insurance and TLC plates included.

475 x 120 = $57000 :rolleyes:
 

marcusguber

Well-Known Member
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  • #12
My cousins did a LTO.... new honda accord sport... $475 a week for 120 weeks. Insurance and TLC plates included.

475 x 120 = $57000 :rolleyes:
Jeezus hes paying 14k a year for insurance and TLC plates, was he able to negotiate at all or was it a take it or leave it deal. My whole reason for thinking about this is to get the weekly under the 400 a week rental not to end up paying more. In the end I can rent for 400 a week and I still own the car after 156 weeks according to what I read in the FTL rental agreement.
 

marcusguber

Well-Known Member
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  • #13
My cousins did a LTO.... new honda accord sport... $475 a week for 120 weeks. Insurance and TLC plates included.

475 x 120 = $57000 :rolleyes:
And with that he cuts the $15/hr Uber job down to $13 too, jeez I remember way back when owner operator deals were like $200-250 a week with a car service in Queens and you ended up with a beat to hell Crown Vic in 2 years. My brother did one of those way back and ended up having his wrecked delivering luggage in a snow storm not long after he was paid off.
 

Lenny_yellow_cab

Well-Known Member
Jeezus hes paying 14k a year for insurance and TLC plates, was he able to negotiate at all or was it a take it or leave it deal. My whole reason for thinking about this is to get the weekly under the 400 a week rental not to end up paying more. In the end I can rent for 400 a week and I still own the car after 156 weeks according to what I read in the FTL rental agreement.
It has a gps tracking device on it too so if he misses a payment they cab remotely turn off the car and come and get it. Talk about slavery. My cousin is an idiot.
 

IERide

Well-Known Member
Leases have NEVER made financial sense for anyone.. Except people with bad credit and even then it makes no financial sense but it's your only option.. Just know that you're pissing money down a hole - it seems that you already figured that out..
FWIW, 3 weeks ago I picked up a 2016 Altima S for $19k
 

marcusguber

Well-Known Member
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  • #16
It has a gps tracking device on it too so if he misses a payment they cab remotely turn off the car and come and get it. Talk about slavery. My cousin is an idiot.
FTL and I believe all of the partners have them, I was sitting there when a guy they shut off called in to ask about it. Yeah it sounds like your cousin didnt think it through at all. But this whole business is predatory and seemed to have gotten worse with Uber's entry into it.
 

Lenny_yellow_cab

Well-Known Member
FTL and I believe all of the partners have them, I was sitting there when a guy they shut off called in to ask about it. Yeah it sounds like your cousin didnt think it through at all. But this whole business is predatory and seemed to have gotten worse with Uber's entry into it.
His has great credit he was just ignorant on the amount of money needed to put TLC plates adn insurance.... They told him, at the place of course, that u would have to shell out 7-10k cash upfront to do the whole process. Snakes...smh
 

marcusguber

Well-Known Member
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  • #18
His has great credit he was just ignorant on the amount of money needed to put TLC plates adn insurance.... They told him, at the place of course, that u would have to shell out 7-10k cash upfront to do the whole process. Snakes...smh
Jeez they really are the worst, where did he go?
 

Uber Driver 007

Well-Known Member
OK let's look at this objectively purely from a business POV.

2016 Honda Accord Sport retails for $26k with destination charge.

Let's say you negotiate $5k off since 2017 is now out.

You're at $21k plus tax...around $1.850.

Now you're at $22,850

You finance the amount at 3% for 28 months (same amount of time as the LTO above). That's about $1,400 in interest.

Now you're at $24,250

DMV registration X 3 years at $475 = $1,425

TLC diamond plus one renewal after 2 years = $1,200

Insurance w physical damage = 5k year X 2.4 years = $12K

$38,875

Looks like they are making about $18K or $150 a week off of this guy.

Is it a "rip-off"? For those who understand how things work, yeah it sounds as such. Much like when making any decisions in life...if you want someone else to do all the leg work and hand you shit on a silver platter...it's gonna cost you a premium.
 
Inshur New York
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