The figures don't lie, yet even some industry leaders profess new-vehicle leasing (NVL) costs the same or less than UVL  without ever calculating either one. Common sense tells us and mathematics prove otherwise in every comparison, especially contrived unorthodox new-vehicle leases. A pre-owned orthodox lease costs less initially, per month, to drive, to trade and even costs less to own.

Table T1 clears the question once and for all with a completely fair comparison based a 2017 Camaro 2SS, 1G1FH1R75H0188432, with 7-miles on the odometer and full factory warranty. This car, currently listed/located in the Manheim Auto Auction inventory, provides equal value whether purchased with cash, financed, leased as new or obtained on a used-vehicle-lease-to-own contract. You are invited to construct comparisons on multiple vehicles of your choice, different terms and/or conditions at Auto Lease Auctions:

T1	Price	Initial Amt	Mo Pmt	Total Pmts	Purch Opt	Cost-2-Own	C-2-O w/TVM
NVL	$50,330	$614	$614	$36,840	$22,044	$58,884	$58,884
UVL	$40,150	$494	$494	$29,640	$16,819	$46,459	$44,451
Save	$10,180	$120	$120	$7,200	$5,225	$12,425	$14,433
%	20%	20%	20%	20%	24%	21%	25%
* $0 down payment. Comparison excludes taxes and fees if any. Rate based on A credit (A+ - C available). Term 60 months. Annual Mileage Allowance = 12,000. Only actual figures from the MMR, UCMR and NADA were used for pricing to make sure the value/benefit to the seller (equal profit) is identical. Only actual rates, terms & conditions from CULA and ALG are used in this comparison to ensure the lender's equal opportunity for income as well. An EIR (earned interest rate) of 9.36% APR is chosen by averaging the current home equity rate of 4.74% and the lowest credit card rate of 13.99% for TVM examples. A copy of the documents and worksheets are available upon request: 800 339-6989 (0 for operator). Full disclosures are available at Auto Lease Auctions, Inc. online:2017 Chevrolet Camaro SS.

CONCLUSION: Used-vehicle leasing provides 21% savings over new-vehicle leasing in this equal comparison. Time value of money applied to the series of monthly savings increases UVL savings advantage to 25% over NVL. The seller's margin is equal in this comparison and although the lender's income is less because of the lower UVL price, availability of used vehicles for leasing is substantially higher; and UVL's realistic amortization enables short-cycle trading, which multiplies seller/lessor income exponentially. Risk Management: The UVL purchase option amount is $5,225 less. The current Manheim Market Report average wholesale value of a 5-year-old (2012) Camaro 2SS with 60K miles is $17,950 indicating at least $1,131 equity at scheduled termination of the used vehicle lease against a probable inequity of at least $4,094 at lease end of the new-vehicle lease. Early termination of the UVL is enabled by a fair payoff amount less than, or close to, the depreciating value of the vehicle, or employing the legal assumption option with a third-party take-over driver for a very low payment; where the NVL lessee & lessor will be upside/down for the duration of the lease and lease assumption is probably disabled by the unattractive high monthly payment. Tax revenue from the NVL is greater, but disabling the natural trade cycles of residents renders incalculable damage to the community's economy.

T2  demonstrates a more likely comparison between a 2015 Chevrolet Camaro 2SS, 2G1FK1EJ5F9102719, with 3,659 miles (also listed/located in the Manheim Auto Auction inventory) to the new Camaro 2SS, 1G1FH1R75H0188432. The vehicles are most similar with the exceptions of 12-months less time and only 29,941 miles covered by factory warranty on the two-year-old; the 2015 unmodified 6.2L V8 factory engine has less horsepower, yet it has more equipment including a power moon-roof:

T2	Price	Initial Amt	Mo Pmt	Total Pmts	Purch Opt	Cost-2-Own	C-2-O w/TVM
NVL	$50,330	$614	$614	$36,840	$22,044	$58,884	$58,884
UVL	$25,542	$327	$327	$19,620	$10,520	$30,140	$25,338
Save	$24,788	$287	$287	$17,220	$11,524	$28,724	$33,546
%	49%	47%	47%	47%	52%	49%	57%
* $0 down payment. Comparison excludes taxes and fees if any. Rate based on A credit (A+ - C available). Term 60 months. Annual Mileage Allowance = 12,000. Only actual figures from the MMR, UCMR and NADA were used for pricing to make sure the value/benefit to the seller (equal profit) is identical. Only actual rates, terms & conditions from CULA and ALG are used in this comparison to ensure the lender's equal opportunity for income as well. A copy of the documents and worksheets are available upon request: 800 339-6989 (0 for operator). Full disclosures are available at Auto Lease Auctions, Inc. online: 2015 Chevrolet Camaro SS; and vehicle information exists at every licensed industry source.

CONCLUSION: Used-vehicle leasing provides 48% average savings over new-vehicle leasing in this subjective comparison. The future value of the monthly savings raises the UVL advantage to 57%. The seller's margin is equal in this comparison and although the lender's income is less because of the lower UVL price, availability of used vehicles for leasing is substantially higher; and UVL's realistic amortization enables short-cycle trading, which multiplies seller/lessor income intentionally. Risk Management: The UVL purchase option amount is $11,524 less. The current Manheim Market Report average wholesale value of a 5-year-old (2010) Camaro 2SS with 60K miles is $15,800 indicating at least $4,276 equity at scheduled termination of the used vehicle lease, against a probable inequity of at least $4,094 at lease end of the new-vehicle lease. The value of factory warranties, extended warranties, scheduled maintenance and trade-flexibility are compared in Part 2. Early termination of the UVL is enabled by a fair payoff amount less than, or close to, the depreciating value of the vehicle, or employing the legal assumption option with a third-party take-over driver for a very low payment; where the NVL lessee & lessor will be upside/down for the duration of the lease and lease assumption is probably disabled by the unattractive high monthly payment. Tax revenue from the NVL is greater, but disabling the natural trade cycles of residents renders incalculable damage to the community's economy.

Fold This Section • Fold Part One

No matter how a car is paid for, even if you double the price or if it is a gift, an automobile can only render one value - the use of it. Why pay for any more than you can possibly get? You do not prepay for groceries or other depreciating necessities, why prepay for use of a vehicle before you use it?  It's true, auto ownership is a tremendous liability and expense – and provides absolutely no monetary benefit whatsoever.  But, in the absence of good, level-yield leasing, simple-interest financing is best for personal transportation.

Table T3 exemplifies initial, monthly and term cost advantages of pre-owned vehicle leasing over conventional simple-interest loan financing of the 2015 Chevrolet Camaro 2SS Coupe, VIN 2G1FK1EJ5F9102719. In addition, this comparison defines an equity position at the end of the lease/loan term to determine the lessee's options to extract all or part of their equity, extend their lease, take a loan  for the purchase option amount, walk away, lease a newer model or purchase the car in consideration that ownership has a value:

T3	Price	Initial Amt	Mo Pmt	Total Pmts	Trans Equity**	TVM Equity***
Finance	$25,500	$2,980	$453	$30,160	$15,800	$15,800
Orthodox UVL	$25,500	$349	$349	$20,940	$14,500	$18,030
Lease Savings	$0	$2,631	$104	$9,220	- $1,300	$2,230
Advantage %	0%	88%	23%	31%	- 8%	14%
* $0 lease down payment; $2,980 loan down payment. Comparison includes sales/use tax at 7% ($1,785) and local fees. Rate based on A credit-tier (A+ - C available). Loan APR = 4.53%. Term 60 months. Annual Mileage Allowance = 12,000 (12K - 35K available). Only actual figures from the MMR, UCMR and NADA were used for pricing to make sure the value/benefit to the seller (equal profit) is identical. Only actual rates, terms & conditions from CULA and ALG are used in this comparison to ensure the lender's equal opportunity for income as well. An EIR (earned interest rate) of 9.36% APR is chosen by averaging the current home equity rate of 4.74% and the lowest credit card rate of 13.99% for TVM examples. Transaction Equity is based upon the MMR average wholesale value of a 5-year-old (2010) Camaro 2SS with 63,639 miles, $15,800. **  UVL Transaction Equity = MMR - Purchase Option Amt + Term Savings, or $15,800 - $10,520 + $9,220 = $14,500 *** UVL Transaction Equity w/TVM = MMR - Purchase Option Amt + Term Savings x (1+EIR), or $15,800 - $10,520 + $12,730 = $18,030 A copy of the documents and worksheets are available upon request: 800 339-6989 (0 for operator). Full disclosures are available at Auto Lease Auctions, Inc. online: 2015 Chevrolet Camaro SS.

CONCLUSION: Pre-owned orthodox leasing provides exactly the same value - use of the Camaro - as conventional financing with a far lower cost during the 5-year term. The initial savings and monthly payment difference are compounded automatically by use inside the example household budget (see EIR) to an amount 14% greater than the purchase option at lease end for those of us who consider ownership as the ultimate value. For those that do not, the used vehicle lease provides a greater "return on investment" of equity at lease end, and more flexibility to trade early with or without equity to move up or down in model/cost, for job or life requirement and/or to avoid maintenance and repairs, which are the highest  undisclosed costs of personal transportation - discussed in part 2 of this document in detail. Taxes are lower on the lease, collected monthly and unlike finance contracts taxes are removed on early termination and removed from the orthodox lease payoff. Smart buyers know auto loans have a profound negative effect on their personal/business financial statement, which can keep them from qualifying for a mortgage and/or curtail the amount of approved funding; where a lease is simply shown as a contingent monthly cost at a fixed amount. The debtor on a loan is an auto owner with their name on the title who is responsible for all losses including catastrophic loss above insurance coverage and unplanned rapid depreciation regardless of cause; where the lessee is not responsible for these losses or any amount lost at lease end due to market effects or improper residual value projections. Mention is made about the improved quality of life for the lessee's financial security position and increased household buying power. Even though profit and rate are equal in this example, the seller, lender and government benefit more from the lease because more money is spent in the community instead of main-lining to the local junkyard and the lessee can and will trade much more often creating multiple profits on the Camaro and multiple profits with each client.

Fold This Section • Fold Part One

All governments, most corporations, auto industry leaders and all financially wise people lease their vehicles even though they have surplus revenue to pay cash for them. The reasons are clearly academic – vehicles depreciate rapidly and money is much more valuable elsewhere.  In other words, as shown below, the cost of the car placed in an investment earns enough to make the monthly payments and buy the vehicle at the end of the lease if desired, with the principal, or a lesser amount, intact left over... The act of "putting your money to work for you".

Tables T4 & T5 are fundamental, single-rate, term-account examples based on a 2017 Jeep Wrangler Unlimited Rubicon, 1C4BJWFG3HL554205, with 3,026-miles on the odometer. This SUV is currently listed/located/available in the Manheim Auto Auction inventory. It is available for custom finance, lease and cash purchase calculations/comparisons at Auto Lease Auctions, a real time sandbox. Everyone should go there, determine their own EIR, review reports and prove their best course of action on every vehicle, every time.

T4: You can purchase this Wrangler outright and pay $45,074 (includes sales tax at 7.00%, $2,949) in cash when you pick it up. Or you can lease the Jeep, for $448 per mo for 60 months including tax. If you lease and place the amount you would have paid in cash, $45,074, in an account like a low-rate hard-loan, 4.74% APR, the total cost for 5-years of leasing then buying this Rubicon (including tax) is $3,176 less than paying cash up front.  Your auto financial model will look like this:

Month	Begin Principal	+	Earned Interest	-	Lse Pmt	=	End Balance	-	Lse Payoff	=	UR Ahead !
1	$45,074	+	$178	-	$448	=	$44,804	-	$43,977,	=	$827
2	$44,804	+	$177	-	$448	=	$44,533	-	$43,675,	=	$858
3...	$44,533	+	$176	-	$448	=	$44,261	-	$43,373,	=	$888...
12...	$42,142	+	$166	-	$448	=	$41,860	-	$38,994,	=	$2,866...

At the end of month 60, you will have $30,115 and you can buy the Wrangler Unlimited for $25,177, plus tax of $1,762, for a total cost of $26,939 to own. Cost-To-Ownership (C2O) is $3,176 less by Leasing-To-Own.

T5: Discussed above, it is easy to raise your EIR to 9.36% APR in a household budget or a very small business. If so, the total cost for 5-years of leasing then buying this (including tax) is $17,814 less than paying cash up front.  Your auto financial model will look like this:

Month	Begin Principal	+	Earned Interest	-	Lse Pmt	=	End Balance	-	Lse Payoff	=	UR Ahead !
1	$45,074	+	$352	-	$448	=	$44,978	-	$43,977,	=	$1,001
2	$44,978	+	$351	-	$448	=	$44,881	-	$43,675,	=	$1,206
3...	$44,881	+	$350	-	$448	=	$44,783	-	$43,373,	=	$1,410...
24...	$43,585	+	$340	-	$448	=	$43,477	-	$35,370,	=	$8,107...

At the end of month 60, you will have $44,753 and you can buy the Wrangler Unlimited for $25,177, plus tax of $1,762, for a total cost of $26,939 to own. Cost-To-Ownership (CTO) is $17,814 less by Leasing-To-Own.

There are many ways to compare lease-buy savings and there are many ways to compound savings: flipping houses, dealers turn cars multiplexing money in amazing aggregates and many business investments can double or even triple overnight.

CONCLUSION: Ownership really has no value and is foolish-looking on most financial statements because the cash-buyer lost liquidity and invested in an item that will lose all its value in about 12-years. MMR reports the wholesale value of a 5-year-old (2012) with 63,026 is $24,600 right now. Few, if any, cash-buyers have the mentality to sell off their purchase at such prices

Fold This Section • Fold Part One

Referencing the AEIOU~Y Encyclopedia written by the same people who invented leasing, money and wrote law, ORTHODOX means “order-of-the-ox” (Tribe of Ephraim) – the right way to do things or suffer the consequences under natural law as things come around whether you are caught or not.

An orthodox lease is structured like this with no down payment required or desired, but available. It is not a loan. It is an annuity due, a financial instrument custom designed per driver to pay for the use of a vehicle while they are using it. The driver is allowed 12,000 miles per year in this example. The lease-end-value (residual, salvage) is set at a safe, insurable amount to protect the lessor; If the LEV is higher, any equity established during the actual term belongs to the lessee, but if the actual LEV is lower and the vehicle was used as agreed, the lessor is responsible for the loss. The lease can be terminated at any time by paying off the balance as shown below or by allowing a third-party to take over the lease with no further obligation. An orthodox lease adheres to the Truth In Leasing Act of 1976 and is in 100% compliance with the Truth In Advertising Laws, Regulations M & Z, et al.

Unorthodox leases exist only in the USA, only on new vehicles and only within some manufacturer's captive lending sources. Instead of designing a lease to match the driver's use, a contrived lease gives the illusion of the lowest monthly payment – especially the advertised lost-leader models with ultra-low mileage of only 2,500 mi per year, available to only the tip-top-credit-tier customers after a substantial down payment. An unorthodox lease attributes monthly payments to the cost of money (lease fees = interest charges in a loan) leaving the lessee with an extremely high payoff upon early termination, remaining lease fees nor taxes, are NOT waived and there is no contractual right to have the lease assumed. The term of an unorthodox lease is set by the lender, usually a short term. This example is based on 60 months and the driver is allowed 8,000 miles per year to make it comparable to our orthodox lease model in T6 above and T8 below. Not all new car captive lender leases are unethically designed, but the majority are. Not all factory lease incentives are contrived instruments, but many are. Buyer beware. Lender beware. Seller beware:

Undisguised, a contrived lease may be an illegal loan and unlawfully promoted, which can only be determined on a case-by-case basis after the consumer obtains the facts from the dealership in person. To avoid this entrapment, a simple solution known to all people is the essence of a good deal – What do you get vs. what do you pay?

Discussed below in Part A, ESP provides consumers with real-time applications and human services online to compare factory offers to both new and used orthodox leases, investigate used vs new leasing, pre-owned orthodox lease (POOL) vs finance and POOL vs cash purchase. Comparing T6 & T7 above, this example is based on actual user mileage of 12,000 per year with 25¢ per mile over charge. ONVL = Orthodox New Vehicle Lease. UNVL = Unorthodox New Vehicle Lease.

T8	ONVL	UNVL	Mi Penalty	UR Ahead!	ONVL Payoff	UNVL Payoff	Advantage!
Initial Cost	$398.75	$3,023.86	$0.00	$2,625.11	$29,700	$35,946	$6,246
Month 2	$797.50	$3,373.79	$83.33	$2,659.62	$29,400	$35,596	$6,196
Month 3	$1,196.25	$3,723.72	$166.67	$2,694.14	$29,100	$35,246	$6,146
Month 4	$1,595.00	$4,073.65	$250.00	$2,728.65	$28,800	$34,896	$6,096
Month 5	$1,993.75	$4,423.58	$333.33	$2,763.16	$28,500	$34,546	$6,046
Month 6	$2,392.50	$4,773.51	$416.67	$2,797.68	$28,200	$34,196	$5,996
Month 7	$2,791.25	$5,123.44	$500.00	$2,832.19	$27,900	$33,846	$5,946
Lease End	$23,925.00	$23,669.73	$5,000.00	$4,744.73	☚ Savings if you turn it in.
Cost-2-Own	$36,765.00	$40,040.73	$0.00	$3,275.73	☚ Savings if you buy it.

The orthodox lessee enjoys considerable saving from the first day of driving to the last regardless if they terminate early, turn the car in or buy it at the end of the lease. This driver is in control of their trade cycle, making equitable decisions. The unorthodox lessee spends thousands more for lower use-value and has substantial liability at termination with little or no equity. The unorthodox lease driver is financially trapped making choices between the lesser of three evils: pay exorbitant penalties, buy the unwanted auto for a high price, or mitigate losses by negotiating with the lessor/dealer for another unorthodox lease.

The orthodox lease seller enjoys multiple transactions with each client who is able to trade often. This seller is building a equitable portfolio of short-cycle repeat business clients and controls a rolling fleet of low-to-fair priced vehicles. The unorthodox lease dealer is forced to take reduced profits dictated by his franchisers advertising. Every lease written takes a client and their vehicle off the market for years to come if not forever. Every repeat customer is a repeat problem with contingent liabilities.

The orthodox lease lender enjoys a consistent flow of business that grows automatically at the power of four. This lessor spends their time on growth and business development while unorthodox lessors create problems for themselves and others down the road in both directions. The unorthodox lease company spends the bulk of their time managing the bulk of the risk they created by writing high residuals and unprincipled amortization schedules.

Deviated leases are unfair competition for orthodox lessors who have little or no representation on the showroom floor. Historically, non compliant lease structures are the demise of every orthodox lessor and eventually every unorthodox lease-lender.. Captive lease incentives are the reason 4.4 million off-lease  vehicles are now showing up at auctions all at once with no foreseeable wholesale or retail market for them. High prices, super-long-term financing, and erring leases are the reason the top credit-tier consumers of the auto ecosystem are so buried in their vehicle they cannot trade.

In 2009 Bankrate.com stated the average person would purchase or lease 18 vehicles throughout their driving lifetime.  Today, Answers.com states  the number is now 9 cars and says the biggest reason for the change is attributed to multiple economic recessions. Records indicate 79% of the American drivers are too far upside/down to trade, which is the probable primary cause 89% of the shoppers who visit a dealership to buy a vehicle leave without one.

Fold This Section • Fold Part One

Fortunate for all (including unorthodox lessors & lessees) orthodox used-vehicle leases (OUVL) are structured the same way as orthodox new-vehicle leasing with the added benefit of abating the heavy first year depreciation, like this on a current model pre-owned with less than 8K miles:

The advantage belongs to the people who can apply pre-owned orthodox leasing  at the point of sale. Pre-owed orthodox leasing (POOL) is the lowest cost to the consumer, easiest to sell, best income for funders, and leasing creates accountable, fair tax revenue, records, write-offs and credits for businesses and governments.

Defined in  the Virtual Fleet & Lease Office© service manual, and carried out at Auto Economics, Auto Financial Advisers & Auto Lease Auctions:

• About 29% of the 89% of the shoppers who visit dealerships and leave without obtaining a vehicle can be satisfied with a slightly used vehicle lease.
• 100% of good-credit drivers of the 79% who are trapped in a captive loan or lease can trade without a loss, cost or contingent liability.
• Used car lessees increase their household buying power by as much as 31%.
• Auto sellers sustain as much 400% increase in used car business with proper application of UVL funding.
• Orthodox lease-lenders enjoy multiple benefits including a high look-to-book ratio, lease funding packages are guaranteed to cash on first presentation, no-to-low repossession rate, never a loss at early or scheduled termination and a vibrant short-cycle repeat business portfolio.
• Defined below in Part 2, orthodox used vehicle leasing enables trade more frequently, which promotes an array of community benefits including establishment of a smooth, natural flow of off-lease vehicles to the remarketing arena.
• Defined in Part 3 below, pre-owned orthodox auto leasing is the only equitable instrument to remarket four-million, four-hundred thousand (4,400,000+) off-lease vehicles flooding our wholesale and retail markets this year.
• Under the rules of natural law, orthodox used vehicle leasing is the savior of the unorthodox lessors so they can continue their business plans with no-to-slight moderation and no-to-reduced exposure until the economy is recovered and redefined.

SUMMARY CONCLUSION: Unorthodox auto leases are palliative measures to move metal, make money and save jobs for select corporations at the expense of consumers, dealers, auctions, financial institutions, residual value insurance groups and the economy of others. Used vehicle leasing costs much less than any other method to obtain and maintain personal transportation while providing more benefits to all parties to every transaction. Only practical application of pre-owned orthodox auto leasing can solve the economic problems of the past, present and future.

Fold This Section • Fold Part One