Howdy, Stranger!

It looks like you're new here. If you want to get involved, click one of these buttons!





2013 and earlier-Honda Accord Lease Questions

1170171173175176183

Comments

  • huskerfan5huskerfan5 Posts: 163
    The math is right but they are lying to you regarding how the sticker price is used. The first formula is fixed, it will be the same for everyone leasing the same model from the same leasing company. The $23,270 represents the MSRP. However, the first number in the second formula represents the capitalized cost of the car, not MSRP. The dealer wants you to think that this number must be equal to the MSRP but it is not. It's the amount that the dealer will be selling the car to the leasing company as well as any other fees you want included in the lease, less any downpayment you want to make.
    Should the car be stolen or totalled, you will be out any money you give the dealer at inception so I always recomment putting all fees (taxes, registration, lease inception, doc fees) into the capitalized cost and never give a down payment. The largest part of the capitalized cost will be the actual cost of the car and you need to negotiate that. I suggest you go to the Prices Paid forum and research what LX's are going for in your area. Let's say they are going for $21,000, doc fees of$300, registration of $200 and Honda lease inception of $595, then the capitalized cost would be $22,095 vs the $23,070 he is using. That would save you about $30 a month.
  • eka1eka1 Posts: 28
    @huskerfan5
    I know what you are saying. But I'm speaking from experience. I had a Accord lease that I paid up 2 months early and I called Honda finance if there is any fees associated with turning it early. They said that they rather have it early cause the car is worth more today then tomorrow. If it's not Honda lease lease then I wouldn't know.
  • etrout85etrout85 Posts: 5
    Thank you for reply.

    Just some questions:

    According to your message, second formula: (23,270 + 14,427.4) x 0.00089 is incorrect because the bold value is suppose to represent the capitalized cost but they are using the MSRP. Just want to confirm that.

    Ultimately, every dealer I am working with are being very strict regarding lowering down the deal (maybe cuz they r scared of the value of the liberty?) value.

    $13,313ish total leasing cost is the best deal i can get at this moment, which translates to 368.07 a month + $63.00 upfront (excluding first months on delivery).

    Basically, my question is how should I effectively negotiate the cap cost down cuz these dealer guys r playing hardball. The salespeople say "MSRP = Cap cost. u cannot talk to my manager/financing guy". How can I get to the endgame leasing contract with less cap cost? Forcefully talk to a NEW manager/ financing guy from a DIFFERENT dealer and just negotiate with him? Salespeople cannot negotiate cap cost when it comes to leasing?

    Again, thanks all. Deeply, DEEPLY appreciate all the help!
  • huskerfan5huskerfan5 Posts: 163
    eka, I never doubted you at all concerning a Honda lease :)
  • huskerfan5huskerfan5 Posts: 163
    Yes, that part of the formula is (Capitalized Cost + Residual) x Money Factor. Frankly, I wouldn't do business with a dealer who outright lied to me about the formula but if you must, I would do a google search for the lease calculation formula, print it out and stick it under the salesman's nose. While not all parts of the capitalized cost are negotiable (such as the $595 lease inception fee charged by Honda Finance should you want that included in the cap cost,) the cost of the car certainly is. If a salesman has authority to negotiate a selling price for a purchase, he has authority to negotiate the selling price for a leased car. There is no difference. Unless Honda is offering different incentives on a lease vs a purchase, you would be able to negotiate the same price on either.
    Unfortunately it always complicates matters when you have a trade.
  • charles_guycharles_guy Posts: 55
    --- If a salesman has authority to negotiate a selling price for a purchase, he has authority to negotiate the selling price for a leased car ---

    yes but hondas now getting strick with lease purchase price cause of turnin=0 and 1500 damage credit

    not many do this and probly in three years its gone then will be damage+disposal=$$$ :( like toyota nissan ford and others
  • sittiesittie Posts: 3
    Thank you for all the helpful information on this forum. I've learned a lot. We are looking to lease a 2013 Accord Coupe and have been quoted the following. I'm calculating lower lease payments than what's been quoted. I suspect it's because I haven't received a breakdown on fees. It's just hard to believe that fees would make this much difference. here are the numbers:
    Negotiated purchase price $26215
    MSRP $28860
    Flex Cash ($500)
    Down Payment ($2500)
    Money factor .00089
    Residual value 57%
    No trade
    12k mi $282
    15k mi $299

    I'm coming up with lease pmts of $231 on 12k and $254 on 15k. Using the numbers above (and no fees) do these figures look correct?
  • huskerfan5huskerfan5 Posts: 163
    etrout, I apologize but I just noticed I gave you some wrong information. The first number in the first formula is also the Cap Cost so the result of this formula will be different for everyone, just like the second formula. The MSRP only comes into play when determing the residual, in this case the $14,427. The rest of my advice doesn't change.
  • huskerfan5huskerfan5 Posts: 163
    charles, I disagree. Regardless of the selling price, the finance company is recouping the difference in what it paid the dealer and the expected residual in the depreciation charge. Yes, they would be earning a larger finance charge if the selling price of the car is higher, but even a $1,000 dollar difference in the cap cost would give the finance company less than $1 of higher income each month at an .00089 money factor. I'm guessing a dealer told you that to justify his lease quote. Feel free to try to convince me otherwise.
  • charles_guycharles_guy Posts: 55
    thank you huskerfan5 for most civil adroit followup. jus tryin to help out here from the crv lease forum where theres no action since our lease

    all i know is my area no body go below 221xx sell price on the truck with lease but with honda .9 finance sale price was lower. go figure. tried and tried and tried but a no go so i guess different areas

    anyway after reading through these many honda forums back some 3+years seems buy price cheaper than lease price tho crv lease 00135/00145mf is crap. honda/acura do take a hit with damage at turnin compared to nissan and ford et al read about sgs on the web and you'll see what i mean

    anyways looked to make sure residuals were exact same at 64%/15920 in case we buy later. aware of sell price but total 36mos cost is key for lease way i see it accord/civic/crv/ferarri/porsche etc. with constant residual jus look at total cost for 3 years. cheapest dealer wins on lease with same vehicle/residual

    why care bout sell price for lease when 36mos total cost with same residual is key comparing dealers in a region
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Hi Jim. The dealer invoice price of this car is $28,292. So the capitalized cost of $28,811 that you were quoted is only $500 over invoice, which isn't bad. Having said that, I also would want to know why the cap cost isn't $28,311 if I was quoted this deal. I would also question what the $652 "Total Add on" and $1,295 in "Dealer/State Fees" include.

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    You're very welcome badger1994.

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Hi pandt. Honda Finance's May buy rate lease money factor and residual value for a 36-month lease of a 2013 Accord Coupe EX-L V6 with Navigation and 15,000 miles per year are .00089 and 53% for consumers who qualify for its top credit tier.

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Hi bada_bing. Honda Finance's May buy rate lease money factor and residual value for a 2013 Accord Sedan Sport with 12,000 miles per year are .00089 and 59% for consumers who qualify for its top credit tier.

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • huskerfan5huskerfan5 Posts: 163
    Charles, in your case, you understand that the selling price of the car is the largest factor in determining the lease amount so if you did a lease deal based on the lowest monthly payment, I think you would have an idea what the cap cost was but many people do not understand leasing.
    Here's an example of what I mean. Let's say an Accord is advertised at three different dealers at the invoice price of $25K which is $3K under MSRP but Pete wants to lease an Accord. He visits the three dealers, not understanding the components and formula that results in the monthly lease payment. Two give him a monthly payment of $350 and the third gives him a payment of $300. The $300 is within his budget so he happily signs the deal. However, if he knew the formula and asked for the money factor and residual and plugged it into a calculator, the cap cost (let's assume there are no fees in this example) would come out to be $28K, the MSRP. Pete may be happy but the dealer is even happier. I would have put it into my calculator and told the dealer, hey, you're advertising to sell the car at invoice but it looks like you are using MSRP as the cost of the car in the lease. He would mutter to himself that I got him and I would walk out with a lease amount about $90 less than Pete's.
    When I shop around for a lease, I get the money factor, residual, and my estimates for doc, registration, taxes and lease inception fees. I add the selling price based on a price that I would consider a good deal and then I calculate the lease payment. Once I have that number, I can shop that amount around knowing that every $10 difference is equivalent to a $333 difference in the cost of the car.
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Hey sanman1. The residual value for a lease of this car with 15,000 miles per year would be 2% lower than the residual value for a lease with 12,000 miles per year.

    I always advise consumers to roll fees into vehicles' payments.

    I personally don't worry all that much about holdback. I shoot for a selling price that's close to dealer invoice minus incentives on most high volume vehicles.

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Here's the information that you're looking for leroybrown72. Honda Finance's May buy rate lease money factor and residual value for a 36-month lease of a 2013 Accord Coupe 4-cylinder EX with 12,000 miles per year are .00089 and 60% for consumers who qualify for its top credit tier.

    The numbers for an otherwise identical lease of an EX-L 4-cylinder are .00089 and 58%.

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • huskerfan5huskerfan5 Posts: 163
    Looks to me that the cap cost would need to be $23,500 vs your $23,215 to come up with $231. In any case, it's not even close to the $282.
    I think your residual may be wrong. At the Weymouthhonda.com site, their lease calculator indicates that the residual is 56% for a EX-L coupe. Also, while it's wise to put as much down as possible on a purchase, it's the opposite with a lease. If your car is stolen or totalled, everything you paid at inception is gone so you want to minimize those costs. I put everything into the lease and get 36 equal payments. The only exception is if you must keep a low monthly debt payment to income ratio because you intend to apply for a mortgage.
  • jaxs1jaxs1 Posts: 2,697
    So, it should be cheaper to lease an EX-L coupe vs sedan since you get 2% higher residual, but have the same money factor?
    This assumes you can get the coupe for the same discounted price as a sedan and you don't lose the savings to higher insurance premiums on the coupe.
  • jw074jw074 Posts: 15
    edited May 2013
    Any thoughts on this?

    http://www.planethondanj.com/happy-honda-days-new-jersey.htm?gclid=COzTwaCGr7cCF- - YqY4AodsAwA8A

    It's 10k miles year...but even if you added 5,000 miles x 20 cents/each = $1,000 / 39 months = ~$25/month --> $184/month

    Unless they're not mentioning a "cap cost reduction" payment

    What's the catch?
  • kyfdxkyfdx Posts: 28,434
    5K mi/year, equals 16,250 miles on a 39 month lease..... That would change your calculation by a lot..

    However, that's not how it's done.... to go from 10K mi/yr to 15K mi/yr, just lower the residual by 3%... that's going to add about $700 total to the lease... so, under $20/mo. more...

    Is it legit? No idea... but, add in tax, four years registration and probably a $399 dealer fee on top of all that.. they are already showing a bank fee that looks to be marked up, as well...

    If it's legit, and all those costs are added in, you are still only around $210/mo. + tax... with only first payment due at signing... that looks pretty cheap to me for a 39mo, 15K/yr lease...

    MODERATOR
    Prices Paid, Lease Questions, SUVs

  • huskerfan5huskerfan5 Posts: 163
    The catch is that the lease isn't with Honda Finance. Honda Finance charges $595 while this third party leasing company charges $795. Honda corporate wants to keep you happy so you get future Hondas, most third party leasing companies just want to make as much money off their lease as possible. What does that mean to you - much higher disposition fee and outrageous wear and tear charges. How do I know?, cause I did one of these for my 98 Audi when I didn't know much about leasing. I would be especially nervous with a 39 month lease since that will give them an opportunity to charge for some mechanical issues that they will have claimed to have found.
  • jbthompsonjbthompson Posts: 1
    Hi everyone. I am in the market for a new car, and am in love with the new Accord. I have been going back and forth with a local dealer and am struggling to get a sign and drive lease at 200 bucks. Best I have been able to get is around 250 a month. Anyone have any luck? Does Honda do promos like this? I also have a local Toyota dealer that is offer 199 sign and drive leases on Camry LEs, including TTL. I am tempted but want an accord!!!!
  • huskerfan5huskerfan5 Posts: 163
    Take the formula for calculating a lease payment (do a web search if you don't have it, you'll need the MSRP, residual pct, money factor and capitalized cost). Find the May residual pct and money factor from one of Car_man's posts, you already have the MRSP and your target payment of $200 and plug them into the formula to back into the capitalized cost. Then back out from the capitalized cost all the fees you plan to put into the lease so you can do a sign and drive, such as the Honda Finance lease inception fee of $595, your local registration fees, etc . That will leave you with the selling price of the car. Compare that number with the prices you see in the Prices Paid forum. I'm sure your selling price won't come close to the best selling price so far on that forum. One fo the reasons that Toyota is offering some really good deals now is because they want people like you, who really want an Accord, to settle for a Camry.
  • charles_guycharles_guy Posts: 55
    edited May 2013
    hamiltons running same here jersey$169. its bs when you get there. we know from coupla weeks past http://www.hamiltonhonda.net/newspaper-ads.htmis the advert

    residual 15661. not from honda. 10k only. oh its website mistake. wheel locks trunk tray guards=499+tax. tax&tax&tax on everything

    lxcrv was like more n 2000 to deal and was really like 309 month

    they have free dogs n food Memorial Day so driving there in our cheaper leased crv for some food

    happy holiday evryone
  • slamshifterslamshifter Posts: 25
    I was watching a professional baseball game yesterday and the t.v. Advert caught my eye for the following; 2013 Honda Accord LX, $0 down for $189.00 a month for 36-month/12,000 miles per year allowance. Subject to limited availability. Excludes taxes, titles and fees. Financing through AHFC. Dealer sets actual vehicle sale price. MSRP $23270 Net cap cost $20734.16. Assuming I am top tier credit with AHFC, and additonal taxes, title and fees apply, what can I expect the final monthly payment to be? The local county tax is 6.75%. I am also assuming this is a bare bones Accord.
  • huskerfan5huskerfan5 Posts: 163
    For every $1,000 you add to the cap cost, your payment will go up about $30. You will need to add the lease inception fee of $595 as well as the dealer doc fees and title/registration fees. Those fees will differ by locality. You should still try to negotiate a decrease in the $20,734.
  • sanman1sanman1 Posts: 69
    Thanks car-man, I ended up paying $27,700 and rolled all fees into the lease payment. The price with $500 flex cash (adjusted cap cost) was $29,200. This included the $595 and $699 dealer fee. The dealer fee they were not moving on and the price of the car was already 10% under MSRP. I could've maybe had them go down another $300 on selling price but that's about it. They also gave me an ipad mini in the deal. Not a big deal it's only a $300 item. They were wiling to take it back and give me the $300 off of the car but that would not do much to the payment. Think I got a decent deal? Too late now anyway but curious.

    Thanks again!
  • ral2167ral2167 Posts: 642
    So what did the monthly payment come to before taxes?
  • sanman1sanman1 Posts: 69
    Payment before sales tax is $392.00. They rolled first payment, tax tag, aquisition fee, and dealer fee into the lease deal. No money out of pocket at drive off.
This discussion has been closed.