Here from sunny California. After battling bumper to bumper traffic in bay area for the past several months, decided to lease a car that would put me in HOV (carpool lane). So, after
test driving Toyoto Prius hybrid plug in, Ford C-Max Energi and Volt, I truly felt Volt's performance was unmatchabale.

Can you let me know whether this is a good deal.

Volt 2014 model
White Diamond
Premium package & Enhanced Safety package(rear view mirrors,auto dimming...etc)

36 month lease period
MSRP $35740
Gross capitalized cost $36,555 ( MSRP + $595 ally admin fee + $220 optional service contract)
Capitalized cost reduction $4186
Residual around $22k (59%)

$3000 down payment goes towards
first month payment
Registration fees $91
Electronic vehicle reg. $29
CA Sales tax $400

Got the deal through Ally bank with 2.2% interest rate.

Below represents the savings that I was able to get,
$1500 CA state tax rebates
$500 costco card rewards
Actual discount from MSRP price $2400

After crunching through the numbers, the final rock bottom price was $375 per month. Do you think whether it is a good/bad deal? Any suggestions is appreciated.

**In response to Curious2car: ** I do not believe that they are offering you a great deal. I am currently working on a more expensive car than you and mine is cheaper. Also, $3000K down is crazy. I would recommend structuring all your deals with only $1000 down and push them for a $300 payment. This is my most recent deal.

2014 Volt, Red Crystal color, leather, heated seats, Bose sound system, Safety 1 pkg., Navigation.
MSRP: $39445.00. The 39 mo payment 15k/yr, $2170.00 out of pocket Monthly Payment: $367 (I still do not consider this to be a good deal, plus they say $2170 down even though I told them structure it with $1000 down.

The way I see it, my dealer is barely even trying yet.

If you build the car you want on the Chevy website, even Chevy's national deal is better than what Ally offered you.

Just got an offer today in CT... I'm going to take it mainly because I'm too lazy to sell my current vehicle and the trade is an OK offer:

Base Volt
36 month, 12,000
34995 MSRP
59.43% residual
33,950 base cap cost
35,234 Gross cap cost (includes fees)
212 monthly depeciation
.0007400 lease factor
They list the Cash Down payment at 6,773, but are somehow giving me rebates to bring my cash down to $4100 (including first months payment)
They are giving me 3K trade-in for a 12 year old Subaru, so I bring $1,000 to signing
Payment is 249.29 before 6.35% tax
Total monthly payment is 265.12

I have never leased a vehicle before and I tend to keep my vehicles for at least 7 or 8 years, so I am wondering if leasing would make any sense for me. If I were to lease and then want to purchase the vehicle at the end of the lease term, is it possible that my ultimate "purchase price" would be lower than if I was able to negotiate a good price and purchase from the beginning?

For what it's worth, I should be able to take advantage of the full $7,500 taxes credit for 2014, and since I live in Texas, my understanding is that I will pay sales tax on the full vehicle cost regardless of lease or purchase.

@bgtees said:
I have never leased a vehicle before and I tend to keep my vehicles for at least 7 or 8 years, so I am wondering if leasing would make any sense for me. If I were to lease and then want to purchase the vehicle at the end of the lease term, is it possible that my ultimate "purchase price" would be lower than if I was able to negotiate a good price and purchase from the beginning?

For what it's worth, I should be able to take advantage of the full $7,500 taxes credit for 2014, and since I live in Texas, my understanding is that I will pay sales tax on the full vehicle cost regardless of lease or purchase.

Thank you for your help!

It's very rare that a "lease to own" deal works out to be less money than buying from the start. It takes a special set of circumstances for that to happen.. The one advantage is: If it turns out to be a car that you don't want to keep for 8 years, you can just let it go at the end of the lease term.

So I see most people are quoting a residual of 59% for a 36month/12K lease. The ALG quotes a residual of 46% and I've heard rumor where they will take that and add the $7500 so that a $34995 would end up at $23,597.70 which results in much lower payments than using 59%. Does anyone know of a lease company that does it that was or is this just a pipe dream?

@jwc905 said:
So I see most people are quoting a residual of 59% for a 36month/12K lease. The ALG quotes a residual of 46% and I've heard rumor where they will take that and add the $7500 so that a $34995 would end up at $23,597.70 which results in much lower payments than using 59%. Does anyone know of a lease company that does it that was or is this just a pipe dream?

Jeff

Independent banks might use ALG, but if they do, they would likely keep the $7500 for themselves. The numbers I quote here are from ALLY Bank.

So I just completed financing with US Bank. They did the residual as .39%+$7500. This ended up with a residual which is .59 which is a few points higher than GM and Ally who use something closer to .56. Of course the cost to purchase at the end of this is the .59 so think about your long term goals, lower payments now will result in a higher buy out later. So when going through this it is worth seeing which lease company will do better in your situation.

It is also worth noting that of the three dealers I worked with on this only two were able to use US Bank.

One quoted me a residual of .42+7500 for 36/12 and the other .39+$7500 for 39/12. The first was a base model the second had safety 1 and safety 2. The 3rd dealer quoted .56 for 36/12 from Ally.

I went so far as to call US Bank and ask them what the formula was for determining the residual and why different dealers were doing it differently. The support person said that the residual is the difference of the cap cost - all payments. When I asked what they use to determine the monthly payment she said that was based on the deal I worked out with the dealer. So I said so the dealer determines the residual and she said no we decide how much to loan out. So we went around like this for quite a while and unfortunately I finally just gave up. But I believe it is ~.4 + $7500 with differences based on length and mileage.

Hopefully this info can help someone out there though.

Everyone posting here is asking if the deal they are quoted is good or not. I am a Finance Professor and would like to propose an alternative way to analyze these deals that assigns an interest rate to the loan amount covering the lease. It would work as follows: what is the interest rate that equates your payments to the gross amount financed in the deal. Below I've appended one of the deals I took from this discussion. They were quoted a purchase price of $31,052, made payments of $338 per month for 36 months, and then gave the car back to the dealer with residual value of $20,655. One can calculate the interest rate that equates these two amounts, the PV of the car, and the PV of the payments plus the discounted future residual value. In this case the interest rate (APR) is approximately 1.75%. I'd say that is a good deal in an absolute sense, and one can compare the deal with others using this approach. Can anyone tell me if this makes sense? It certainly simplifies things. My spreadsheet allows for added charges, down payments, different residuals, etc. The way that the dealer does this calculation is a little obscure, using finance factors etc. Let me know.

Car Lease Analysis
Chevrolet Volt
Deal 2
Purchase $34,995.00
Fees, Taxes etc. $-
Gross Purchase $31,052.00
Amt Down (Drive-off?) $-
Payment $(338.00)
months 12
Years 3
Periods 36
Residual Percent 66.5%
Residual Value $(20,655.00)
APR 1.75%
Periodic Rate 0.15%
PV of Pmts plus Residual Value $31,462.31

@vint280sl said:
Everyone posting here is asking if the deal they are quoted is good or not. I am a Finance Professor and would like to propose an alternative way to analyze these deals that assigns an interest rate to the loan amount covering the lease. It would work as follows: what is the interest rate that equates your payments to the gross amount financed in the deal. Below I've appended one of the deals I took from this discussion. They were quoted a purchase price of $31,052, made payments of $338 per month for 36 months, and then gave the car back to the dealer with residual value of $20,655. One can calculate the interest rate that equates these two amounts, the PV of the car, and the PV of the payments plus the discounted future residual value. In this case the interest rate (APR) is approximately 1.75%. I'd say that is a good deal in an absolute sense, and one can compare the deal with others using this approach. Can anyone tell me if this makes sense? It certainly simplifies things. My spreadsheet allows for added charges, down payments, different residuals, etc. The way that the dealer does this calculation is a little obscure, using finance factors etc. Let me know.

Car Lease Analysis
Chevrolet Volt
Deal 2
Purchase $34,995.00
Fees, Taxes etc. $-
Gross Purchase $31,052.00
Amt Down (Drive-off?) $-
Payment $(338.00)
months 12
Years 3
Periods 36
Residual Percent 66.5%
Residual Value $(20,655.00)
APR 1.75%
Periodic Rate 0.15%
PV of Pmts plus Residual Value $31,462.31

The calculator my co-host and I use has no math functions more complicated than the basics - add, subtract, multiply and divide. It's just a matter of knowing what numbers to plug in:

MSRP

Selling Price

Residual Value

Money Factor (rent charge, interest rate)

Length of lease

michaell@edmunds.com

Moderator, Prices Paid and Leasing Experiences

2013 Hyundai Elantra GT / 2010 Mazda CX-7 GT / 2014 MINI Countryman S ALL4

I understand that. However, if you want get an accurate understanding of the actual cost of the transaction, you need to know the implicit interest rate involved. This is like the true price of the lease. Let's say you agree on the value (or cost) of the car, the present value, the dealer then states the payment amount (they would calculate this using the "money factor" method), and you agree also on the value of the car at the termination of the lease. There is an interest rate that is implicit in this contract which represents the cost they are charging for you to use the car for the period of the lease. The present value of the car today equals the discounted fixed payment stream and the future value of the car at termination. Their method obscures this, in my opinion. But I haven't found anyone else who is interested in the alternative approach. I was wondering if anyone on the discussion had looked at this.

Can we have updated numbers for April if they are out yet?
Also, I see people talking about the low residual plus the tax rebate raising the residual percentage. Can anyone show me how that's done? I'm sure I'm missing something here.

@vint280sl said:
I understand that. However, if you want get an accurate understanding of the actual cost of the transaction, you need to know the implicit interest rate involved. This is like the true price of the lease. Let's say you agree on the value (or cost) of the car, the present value, the dealer then states the payment amount (they would calculate this using the "money factor" method), and you agree also on the value of the car at the termination of the lease. There is an interest rate that is implicit in this contract which represents the cost they are charging for you to use the car for the period of the lease. The present value of the car today equals the discounted fixed payment stream and the future value of the car at termination. Their method obscures this, in my opinion. But I haven't found anyone else who is interested in the alternative approach. I was wondering if anyone on the discussion had looked at this.

The interest rate on a Chevy lease is right there... You don't really have to calculate it, because they give it to you. (Ally Bank uses APRs) The one thing you have to factor in for the lease vs. purchase, are the extra fees you pay to lease, the tax treatment vs. purchasing (sometimes better, sometimes worse), and whether the residuals are realistic. Sometimes, incentives come in the form of an artificially inflated residual. If you only want the car for the lease term, that's an incentive that is easily quantified, but goes away, if you purchase the car at the end of the lease.

True money factors can be converted to an approximate APR by multiplying them by 2400.

A lease is just an alternative method of financing a vehicle. If there were no extra fees, and the money factor/APR was identical to the purchase rate, and you knew for certain that the residual was going to be accurate, then then leasing would be exactly equivalent to purchasing (and selling at the end of the lease term).

@Slimms said:
Can we have updated numbers for April if they are out yet?
Also, I see people talking about the low residual plus the tax rebate raising the residual percentage. Can anyone show me how that's done? I'm sure I'm missing something here.

1.00% MF and 56% for 36mo, 15K/yr. $1571 lease cash.
These numbers are from ALLY Bank.

In this calculation ALLY is keeping the tax credit. Other banks (USBank) would also keep the tax credit, but they may have a much lower residual, and give a matching rebate ($6500 or so), to make up for it. The payment is likely to be similar, but if you are considering purchasing the car at lease-end, the latter type of lease program would be much better, as the residual will be lower.

@kyfdx@Edmunds said:
In this calculation ALLY is keeping the tax credit. Other banks (USBank)
would also keep the tax credit, but they may have a much lower residual, and give a matching rebate ($6500 or so), to make up for it. The payment is likely to be similar, but if you are considering purchasing the car at lease-end, the latter type of lease program would be much better, as the residual will be lower.

So for a base $35k volt, there is $1571 taken off for lease cash ? If you were paying sticker, you'd be looking at $33,429
.56 is $19,600 (from 35,000)
$35000-19,600 = $15,400
$15,400 - 1,571 = 13,829
$13,829/36 = $384 plus tax/money factor and other fees. Looks like people are getting substantial discounts to get prices around and under $300

A lease is just an alternative method of financing a vehicle. If there were no extra fees, and the money factor/APR was identical to the purchase rate, and you knew for certain that the residual was going to be accurate, then then leasing would be exactly equivalent to purchasing (and selling at the end of the lease term).

Thank you for responding to my inquiry. I understand they are equivalent, but for some reason they are not negotiated the same way. Why? Can you explain to me in more detail exactly what a money factor is? And perhaps you could comment on a proposed method for negotiating a lease, below:

Prior to negotiating the lease you get information on the True Market Value (TMV) of the car if purchased. You then add in all the fees and taxes that you would have to pay. This gives you the total amount to be paid. They then give you a proposed down payment and monthly lease payment using their method (money factor), and somehow you derive a residual(salvage) value for the car at the end of the lease. You then calculate what they are charging in interest by determining the rate which discounts all of your payments to a sum equivalent to the initial amount. In finance this is known as the "Internal Rate of Return." This gives you all the information you need to negotiate a fair deal, TMV ,the interest rate, and the amount of your contractural payments. These are the actual costs of the deal.

Now, if the rate (IRR) implied in the quote is too high, say 6-10%, you ask for a lower down payment, a lower fixed monthly payment, or in the situation where you are sure you are buying the car at the end of the lease, a lower contractural estimated residual value.(Note that this IS a payment, because you either give them back the car, or pay them this amount in cash to own it outright.) Lowering any of these lowers the interest rate. Say they are offering deals with 0.9% interest; then ask them to lower your payments until you realize that rate. Does that make sense?

This method has the quite significant benefit of allowing a purchaser to compare deals which have different prices, payments and/or residual values. But, as in a purchase, you do have to start with a solid broadly accepted price for the vehicle, e.g. the Edmunds TMV or something related to dealer invoice.

The residual isn't negotiated. It's set by the bank offering the loan. It's what they determine the car to be worth when you turn it in. What you pay in a lease is depreciation and interest. That's it.
$20k car
$11k residual
You pay $9k over your 24,36,39 month lease. Your state varies over how the tax and money factor is applied to the payment.

## Comments

2Hello to all,

Here from sunny California. After battling bumper to bumper traffic in bay area for the past several months, decided to lease a car that would put me in HOV (carpool lane). So, after test driving Toyoto Prius hybrid plug in, Ford C-Max Energi and Volt, I truly felt Volt's performance was unmatchabale.

Can you let me know whether this is a good deal.

Volt 2014 model White Diamond Premium package & Enhanced Safety package(rear view mirrors,auto dimming...etc)

36 month lease period MSRP $35740 Gross capitalized cost $36,555 ( MSRP + $595 ally admin fee + $220 optional service contract) Capitalized cost reduction $4186 Residual around $22k (59%)

$3000 down payment goes towards first month payment Registration fees $91 Electronic vehicle reg. $29 CA Sales tax $400

Got the deal through Ally bank with 2.2% interest rate.

Below represents the savings that I was able to get, $1500 CA state tax rebates $500 costco card rewards Actual discount from MSRP price $2400

After crunching through the numbers, the final rock bottom price was $375 per month. Do you think whether it is a good/bad deal? Any suggestions is appreciated.

- Spam
- Abuse

0 · Like LOL6**In response to Curious2car: ** I do not believe that they are offering you a great deal. I am currently working on a more expensive car than you and mine is cheaper. Also, $3000K down is crazy. I would recommend structuring all your deals with only $1000 down and push them for a $300 payment. This is my most recent deal.

2014 Volt, Red Crystal color, leather, heated seats, Bose sound system, Safety 1 pkg., Navigation. MSRP: $39445.00. The 39 mo payment 15k/yr, $2170.00 out of pocket Monthly Payment: $367 (I still do not consider this to be a good deal, plus they say $2170 down even though I told them structure it with $1000 down.

The way I see it, my dealer is barely even trying yet.

If you build the car you want on the Chevy website, even Chevy's national deal is better than what Ally offered you.

- Spam
- Abuse

0 · Like LOL2Thanks dannog35 for the insight... appreciate it...

- Spam
- Abuse

0 · Like LOL1Just got an offer today in CT... I'm going to take it mainly because I'm too lazy to sell my current vehicle and the trade is an OK offer:

Base Volt 36 month, 12,000 34995 MSRP 59.43% residual 33,950 base cap cost 35,234 Gross cap cost (includes fees) 212 monthly depeciation .0007400 lease factor They list the Cash Down payment at 6,773, but are somehow giving me rebates to bring my cash down to $4100 (including first months payment) They are giving me 3K trade-in for a 12 year old Subaru, so I bring $1,000 to signing Payment is 249.29 before 6.35% tax Total monthly payment is 265.12

- Spam
- Abuse

0 · Like LOL15I have never leased a vehicle before and I tend to keep my vehicles for at least 7 or 8 years, so I am wondering if leasing would make any sense for me. If I were to lease and then want to purchase the vehicle at the end of the lease term, is it possible that my ultimate "purchase price" would be lower than if I was able to negotiate a good price and purchase from the beginning?

For what it's worth, I should be able to take advantage of the full $7,500 taxes credit for 2014, and since I live in Texas, my understanding is that I will pay sales tax on the full vehicle cost regardless of lease or purchase.

Thank you for your help!

- Spam
- Abuse

0 · Like LOL25,898It's very rare that a "lease to own" deal works out to be less money than buying from the start. It takes a special set of circumstances for that to happen.. The one advantage is: If it turns out to be a car that you don't want to keep for 8 years, you can just let it go at the end of the lease term.

Moderator - Prices Paid, Lease Questions, SUVs

- Spam
- Abuse

0 · Like LOL2So I see most people are quoting a residual of 59% for a 36month/12K lease. The ALG quotes a residual of 46% and I've heard rumor where they will take that and add the $7500 so that a $34995 would end up at $23,597.70 which results in

muchlower payments than using 59%. Does anyone know of a lease company that does it that was or is this just a pipe dream?- Spam
- Abuse

0 · Like LOL25,898Independent banks might use ALG, but if they do, they would likely keep the $7500 for themselves. The numbers I quote here are from ALLY Bank.

Moderator - Prices Paid, Lease Questions, SUVs

- Spam
- Abuse

0 · Like LOL2So I just completed financing with US Bank. They did the residual as .39%+$7500. This ended up with a residual which is .59 which is a few points higher than GM and Ally who use something closer to .56. Of course the cost to purchase at the end of this is the .59 so think about your long term goals, lower payments now will result in a higher buy out later. So when going through this it is worth seeing which lease company will do better in your situation.

It is also worth noting that of the three dealers I worked with on this only two were able to use US Bank.

One quoted me a residual of .42+7500 for 36/12 and the other .39+$7500 for 39/12. The first was a base model the second had safety 1 and safety 2. The 3rd dealer quoted .56 for 36/12 from Ally.

I went so far as to call US Bank and ask them what the formula was for determining the residual and why different dealers were doing it differently. The support person said that the residual is the difference of the cap cost - all payments. When I asked what they use to determine the monthly payment she said that was based on the deal I worked out with the dealer. So I said so the dealer determines the residual and she said no we decide how much to loan out. So we went around like this for quite a while and unfortunately I finally just gave up. But I believe it is ~.4 + $7500 with differences based on length and mileage.

Hopefully this info can help someone out there though.

Happy Shopping!

- Spam
- Abuse

0 · Like LOL25,898So.. what sort of payment did you end up with?

Moderator - Prices Paid, Lease Questions, SUVs

- Spam
- Abuse

0 · Like LOL3Everyone posting here is asking if the deal they are quoted is good or not. I am a Finance Professor and would like to propose an alternative way to analyze these deals that assigns an interest rate to the loan amount covering the lease. It would work as follows: what is the interest rate that equates your payments to the gross amount financed in the deal. Below I've appended one of the deals I took from this discussion. They were quoted a purchase price of $31,052, made payments of $338 per month for 36 months, and then gave the car back to the dealer with residual value of $20,655. One can calculate the interest rate that equates these two amounts, the PV of the car, and the PV of the payments plus the discounted future residual value. In this case the interest rate (APR) is approximately 1.75%. I'd say that is a good deal in an absolute sense, and one can compare the deal with others using this approach. Can anyone tell me if this makes sense? It certainly simplifies things. My spreadsheet allows for added charges, down payments, different residuals, etc. The way that the dealer does this calculation is a little obscure, using finance factors etc. Let me know.

Car Lease Analysis

Chevrolet Volt

Deal 2 Purchase $34,995.00 Fees, Taxes etc. $-

Gross Purchase $31,052.00 Amt Down (Drive-off?) $-

Payment $(338.00) months 12 Years 3 Periods 36 Residual Percent 66.5% Residual Value $(20,655.00) APR 1.75% Periodic Rate 0.15% PV of Pmts plus Residual Value $31,462.31

- Spam
- Abuse

0 · Like LOL1,155The calculator my co-host and I use has no math functions more complicated than the basics - add, subtract, multiply and divide. It's just a matter of knowing what numbers to plug in:

MSRP

Selling Price

Residual Value

Money Factor (rent charge, interest rate)

Length of lease

michaell@edmunds.comModerator, Prices Paid and Leasing Experiences

2013 Hyundai Elantra GT / 2010 Mazda CX-7 GT / 2014 MINI Countryman S ALL4

- Spam
- Abuse

0 · Like LOL3I understand that. However, if you want get an accurate understanding of the actual cost of the transaction, you need to know the implicit interest rate involved. This is like the true price of the lease. Let's say you agree on the value (or cost) of the car, the present value, the dealer then states the payment amount (they would calculate this using the "money factor" method), and you agree also on the value of the car at the termination of the lease. There is an interest rate that is implicit in this contract which represents the cost they are charging for you to use the car for the period of the lease. The present value of the car today equals the discounted fixed payment stream and the future value of the car at termination. Their method obscures this, in my opinion. But I haven't found anyone else who is interested in the alternative approach. I was wondering if anyone on the discussion had looked at this.

- Spam
- Abuse

0 · Like LOL10Can we have updated numbers for April if they are out yet? Also, I see people talking about the low residual plus the tax rebate raising the residual percentage. Can anyone show me how that's done? I'm sure I'm missing something here.

- Spam
- Abuse

0 · Like LOL25,898The interest rate on a Chevy lease is right there... You don't really have to calculate it, because they give it to you. (Ally Bank uses APRs) The one thing you have to factor in for the lease vs. purchase, are the extra fees you pay to lease, the tax treatment vs. purchasing (sometimes better, sometimes worse), and whether the residuals are realistic. Sometimes, incentives come in the form of an artificially inflated residual. If you only want the car for the lease term, that's an incentive that is easily quantified, but goes away, if you purchase the car at the end of the lease.

True money factors can be converted to an approximate APR by multiplying them by 2400.

A lease is just an alternative method of financing a vehicle. If there were no extra fees, and the money factor/APR was identical to the purchase rate, and you knew for certain that the residual was going to be accurate, then then leasing would be exactly equivalent to purchasing (and selling at the end of the lease term).

Moderator - Prices Paid, Lease Questions, SUVs

- Spam
- Abuse

0 · Like LOL25,8981.00% MF and 56% for 36mo, 15K/yr. $1571 lease cash.

These numbers are from ALLY Bank.

In this calculation ALLY is keeping the tax credit. Other banks (USBank) would also keep the tax credit, but they may have a much lower residual, and give a matching rebate ($6500 or so), to make up for it. The payment is likely to be similar, but if you are considering purchasing the car at lease-end, the latter type of lease program would be much better, as the residual will be lower.

Moderator - Prices Paid, Lease Questions, SUVs

- Spam
- Abuse

0 · Like LOL10So for a base $35k volt, there is $1571 taken off for lease cash ? If you were paying sticker, you'd be looking at $33,429 .56 is $19,600 (from 35,000) $35000-19,600 = $15,400 $15,400 - 1,571 = 13,829 $13,829/36 = $384 plus tax/money factor and other fees. Looks like people are getting substantial discounts to get prices around and under $300

- Spam
- Abuse

0 · Like LOL25,898Yeah... I wouldn't pay sticker..

Moderator - Prices Paid, Lease Questions, SUVs

- Spam
- Abuse

0 · Like LOL3@kyfdx@Edmunds said:

Thank you for responding to my inquiry. I understand they are equivalent, but for some reason they are not negotiated the same way. Why? Can you explain to me in more detail exactly what a money factor is? And perhaps you could comment on a proposed method for negotiating a lease, below:

Prior to negotiating the lease you get information on the True Market Value (TMV) of the car if purchased. You then add in all the fees and taxes that you would have to pay. This gives you the total amount to be paid. They then give you a proposed down payment and monthly lease payment using their method (money factor), and somehow you derive a residual(salvage) value for the car at the end of the lease. You then calculate what they are charging in interest by determining the rate which discounts all of your payments to a sum equivalent to the initial amount. In finance this is known as the "Internal Rate of Return." This gives you all the information you need to negotiate a fair deal, TMV ,the interest rate, and the amount of your contractural payments. These are the actual costs of the deal.

Now, if the rate (IRR) implied in the quote is too high, say 6-10%, you ask for a lower down payment, a lower fixed monthly payment, or in the situation where you are sure you are buying the car at the end of the lease, a lower contractural estimated residual value.(Note that this IS a payment, because you either give them back the car, or pay them this amount in cash to own it outright.) Lowering any of these lowers the interest rate. Say they are offering deals with 0.9% interest; then ask them to lower your payments until you realize that rate. Does that make sense?

This method has the quite significant benefit of allowing a purchaser to compare deals which have different prices, payments and/or residual values. But, as in a purchase, you do have to start with a solid broadly accepted price for the vehicle, e.g. the Edmunds TMV or something related to dealer invoice.

- Spam
- Abuse

0 · Like LOL10$20k car

$11k residual

You pay $9k over your 24,36,39 month lease. Your state varies over how the tax and money factor is applied to the payment.

- Spam
- Abuse

0 · Like LOL