After reviewing the Dodge Caliber and the Jeep Compass/Patriot, in our last Diamonds in the Rough review, I thought that it would be an important opportunity to use one of the "triplets" to reiterate the ideas behind a "flat out" purchase, a "finance purchase", and a "lease" that we touched on last month. To illustrate these concepts we have decided to use the Dodge Caliber triplet. Now it may seem wasteful to spend anymore time writing about a vehicle that is far from the ultimate driving machine, but if it can help to further illuminate the type of purchaser you are ,allowing you to equally measure vehicles and their prices, then this space will be invaluable to you. All too often buyers get swept into a price vacuum that the dealer is all too happy to perpetuate. This vacuum may lead you to think you are getting the best deal among a few choices at a given dealer, but terns out ultimately to be a terrible deal amidst the competition. If you can learn to fairly evaluate each deal for your needs you will be able to create an even playing field for yourself. In our recent review we mentioned that the Dodge Caliber made a good roadway companion as long as you kept it simple, by forgoing costly options, keeping the price down. We mentioned that the Caliber made sense at a lower price and was pure insanity in it's higher range. Now in reality this is true, if you are a cash buyer. Now as we mentioned before the benefits of a cash buy are tremendous. By paying at one time you save the finance and interest rate charges, you usually pay less for the vehicle because you are not as fixed on the monthly payment, and last but not least you can enjoy the vehicle as your own reaping the rewards of "owning" the vehicle at it's highest resale value, instead of finally becoming the vehicles owner just in time to turn it in or even worse after a long term finance finding you owe more than the value of the vehicle, how depressing is that. A cash buy however is limited to the width of their wallet without the benefits of "financing smoke and mirrors, which can be limiting. In the case of our subject the Caliber is a value as a cash buy only at it's low end. This is true because the basic driver pedigree of the Caliber can not compare to an Accord or a Camry, let alone a multitude of fine SUV's or sport coupes that occupies the more rarefied air of a high line Caliber ,that can top more than $24,000. Now a second look at the same Dodge from another point of view illustrates a totally different result. If you prefer to keep your money in the bank, financing the purchase of the vehicle may be your best bet. A base Dodge Caliber that would make a good buy for the cash purchaser comes in around $17,210. Now this is a sticker price so a cash buyer could work that price down even further. Even after the basic incentives the price becomes $16710, and that is without any "slight of hand". That same Caliber finances for $301 a month for 72 months with an interest rate of %7.9. Now if you think a lease is for you that same Caliber looked at from one last angle will lease for $309 a month for 48 month with a mileage restriction of 12,000 miles per year. Now in nearly all cases a vehicle will lease for far less than it would be financed for. It is a startling revelation to realize that this Caliber leases for a price that is a few lattes a month short of a Volvo ,that is needless to say a better choice for anyone. This example is just one of many that illustrates the importance of understanding your needs, your budget, and the importance of "cross shopping", that's cross shopping, please don't misunderstand! Now to further clarify this, or further confuse depending on your thoughts, a far more expensive Caliber RT AWD ,for a sticker of $20,535, that would be a bad choice for the cash buyer,( after all that price opens many doors, car doors that is), becomes a viable choice for a person looking to finance. The RT under the same terms as the SE highlighted above go's for $358 a month, or only $57 a month more than the Caliber with far less equipment. In this case the slightly higher monthly price makes sense when you consider the tangible equipment you would gain ,such as four wheel disk brakes and AWD. The lease on the RT shows a similar situation coming in at $367 a month. Now you may say to yourself, money is money so why am I making so much out of the high lease price but minimize the price of the finance price when both are so close? The answer to that is simple, At the end of the term you own the car, you don't have to worry about millage restrictions or wear and tear, which can add a lot of money to your closing costs. In reality you must understand that the lease price represents just the time you lease the car, you still must return the car or pay even more money to buy it, and in the case of a Caliber ,at a price that is often higher than what the car should sell for used. A financed car is eventually owned outright, so you can drive it for as long as you choose. So after all of this it is clear that a cash buy makes the most sense. A lease that is as much as a luxury car makes no sense what so ever, and a financing purchase that at face value makes a least some fiscal sense starts to pale when you consider that at the end of 72 months you own a car that may be starting to feel old or outdated, economy cars simply don't have the longevity of a high line car, so it is apparent that the simple rule saves the day. Now you may say what is the point of all of this? The point is that when you go to the dealer seeking what you think is a "cheap" car you must be informed and do your homework before signing on the bottom line. You must understand that dealers are not there to lie or mislead, however they are not there to be your mommy and make it all better, a good salesman will find your weak spot and seize upon it like a crow to road kill. The more you inform yourself the more respect you will be given. If you go to the dealer with a clear idea of what you want and the information needed to negotiate a price that is fare for all, your experience will not be a bad one. Just remember to treat the dealer with the same level of preparation you would treat a judge fighting a speeding ticket and you will succeed. Now please don't find this daunting I wanted to reiterate these concepts once again to reinforce your knowledge and confidence in finding that perfect vehicle. Please don't feel this is all too much to drink in or find on your own. All the information I used for this article was obtained at Dodge.com. I selected the check inventory button and then picked the vehicles from a dealers inventory, pick a dealer near you, then I went in deeper by clicking the payment button. This button gives you all the info you need to play with the figures before you ever set foot in a dealer. If you are looking to finance you can take the information and jot it down and then move on to another cars website that will allow you to similarly play with the numbers. It is amazing how much work can be done now in advance before leaving yourself prey to the dealers top sales persons. With time you may even find it fun to work the numbers to your favor. And remember all this homework will be well worth it the next time you go to the dealer with the calm of a top attorney who is ready to blow a case wide open! And just remember if the payment doesn't fit you must acquit.
