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Honda S2000 Lease Questions

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Comments

  • rujorujo Posts: 132
    1) Selling price is the first and most important item to negotiate when you want to lease a car. People are reporting quotes as low as $28,500 recently - you may not get that low a price, but $29,000-29,500 should be achievable . . . and I assume the LA market is very competitive. (I received a quote of $28,888 this week from a dealer I know and trust in the SF Bay Area.)

    2) AHFC uses your Experian Auto Fico 2 score. Unfortunately, this score is not available to the consumer and may vary by 20-40 points from the score you pull. (I know this from recent personal experience!) An Experian Auto Fico 2 score of 710 qualifies you for the super preferred credit tier - I don't know how or whether AHFC factors in other aspects of your credit history. I'd be at least a little wary of the info you're getting from this dealer - they're almost certainly trying to put you into a lease they can make more money on - and they are probably smelling your "S2000 lust".

    3) At leasecompare.com I input your Fico score along with a "selling price" of $29,000 with nothing down. I got back a 48mo/12k payment of $398 plus tax. Remember this is with zero down. It's zip code specific and, I suppose, might vary depending upon where you live. But I certainly wouldn't do a non-AHFC lease with anyone before seeing what leasecompare.com comes up with.
  • Thanks rujo.

    I also run the numbers again and it seems 0 down and 400+tax would be an OK deal with an APR of approx.6% on a 48mo/12 k deal. Leasecompare just does not seem to include any fees tilte, first month etc. which end up being around $1500 at drive off.

    I am currently pushing numbers with a dealer who is dying to run my credit. The only thing I am still sketchy about is whether I would qualify for a special w- AHFC (if there is one coming out) and whether other tears would benefit from it also.
    I have scheduled to go to the dealer again tomorrow.
    It would be great if anyone in this forum knows anything about how AHFC deals with it. :confuse:

    Thanks!
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Hi tonyr313. You never mentioned the selling price or MSRP of the car that you are interested in leasing. These are important numbers for you as a consumer to know for two reasons. First, the selling prices of leased vehicles can be negotiated, just as if you were paying cash for them. Without knowing this car's selling price in relation to its MSRP you don't know how much of a discount you are getting on it. The second reason is that one needs the selling price and MSRP, including the destination charge, of a vehicle to calculate its lease payment. I would be glad to give you my opinion of this deal if you let me know what these numbers are.

    For now I can tell you that it is not a good idea to pay $5,000 at lease signing. There's nothing wrong with paying the first month's payment, security deposit, etc... for a lease at signing but you really shouldn't make any sort of capitalized cost reduction. Consumers who make large down payments on leased vehicles risk possibly losing them if their vehicle is totaled in an accident or stolen and never recovered.

    Car_man
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  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Hi Dennis. Honda's incentives for the S2000 are the same in May as they were in April. It still does not have a special lease program on this car, but in April it introduced $2,000 dealer cash on it. This was a pretty big step up from zero dealer cash in March, especially when we are heading into prime top-down season. This is definitely an indication that the S2000 is not selling nearly as well as Honda would like.

    Car_man
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  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Hi 23109vc. Let's work up a lease payment and see what we come up with. According to my calculations, if you were to lease a 2007 Honda S2000 that has an MSRP of $34,845 and a selling price of $29,605 ($2,000 under invoice) through Honda Finance right now for 36 months with 12,000 miles per year, your zero down, pre-tax monthly payment would be around $407, assuming that you qualify for its "Super Preferred" credit tier and pay a security deposit at lease signing.

    Car_man
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  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Hi accelerator. Yes, the first thing that you should do on a vehicle that you are interested in leasing is negotiate an attractive selling price.

    Vehicles' residual values are based upon their full MSRPs, including the destination charge and any factory installed options. I am not sure if Honda Finance allows the dealer-installed options to be residualized.

    The capitalized cost for your lease is whatever price you negotiate. If I was in the market for an S2000 right now, I personally would shoot for a price of around dealer invoice minus the $2,000 dealer cash as you mentioned in your post, but there is no guarantee that you will be able to get hat price.

    General Motors is no longer offering leases on 2006 models. If you want to lease an '06 Pontiac Grand Prix, you will have to do so through an independent bank. I have to tell you though that this late in the model year the residual values of leftover 2006 models have dropped so much that they probably are going to be unreasonably expensive to lease.

    Car_man
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  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Hi cantwait_s2k. Technically, consumers only need a credit score of 710 or better to qualify for Honda Finance's top aka "Super Preferred" credit tier. Having said this, I'm not sure how your limited credit history and limited residence in the United States will have an impact upon your approval for this tier. I suspect that there is a decent chance that you would be approved for the "Super Preferred" tier, but I cannot guarantee that you would be.

    When the dealer told you that a special lease program on this car would not benefit you they were incorrect. When Honda offers special lease money factors on a vehicle, it provides lower than normal rates for all credit tiers, not just its top one. While you might not qualify for the lowest available lease money factor if Honda introduced a special lease program on the S2000, you would qualify for a factor that is better than what you would normally have to pay. Of course, there is no guarantee that Honda will introduce a special lease program on the S2000 in the near future. Its current program is scheduled to run through July 2nd.

    You never mentioned the selling price or MSRP of the car that you are interested in leasing. These are important numbers for you as a consumer to know for two reasons. First, the selling prices of leased vehicles can be negotiated, just as if you were paying cash for them. Without knowing this car's selling price in relation to its MSRP you don't know how much of a discount you are getting on it. The second reason is that one needs the selling price and MSRP, including the destination charge, of a vehicle to calculate its lease payment. I would be more than happy to give you my opinion on the deal that you were quoted if you let me know what these numbers are.

    Car_man
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  • acceleratoraccelerator Posts: 136
    This is just a thought I wanted to post here but with a car with the reliability and quality of the S2000, do you see any problems with a 48 month lease? I know you should not lease a vehicle longer than the warranty covers.

    Your thoughts? Thanks.
  • dwynnedwynne Posts: 4,018
    They can lease it to you as a used car. They show the retail value (what the lease will be based on - like the MSRP of a new lease car) at $28,875. In my ZIP with a 730 FICO they show a lease with a residual of $17,091, MF of 0.00290 (6.96%), and a payment of $496 + taxes per month with nothing but first payment and TTL due at signing.

    If I put in a new 07 with a selling price of $30,500 (conservative) it comes up with $18,468 0.00258 $485 - so for less money you could lease the 07. Payments would go lover the lower you get the price. $454 a month if you could get the price down to $29,500.

    Dennis
  • dwynnedwynne Posts: 4,018
    I would not do it. The 36 month lease is normally the sweet spot in the leasing curve. The 24 month normally has too little time to overcome the rapid initial depreciation. The 48 month saves a little each month, but normally not that much. I checked the 3rd party lease offer on a new S2000 and the difference is just $45 per month, or about 10% of the monthly payment. I would suggest that if an extra $45 a month is a deal breaker on a $450 per month lease, that you probably do not need to be leasing this car at this time.

    Dennis
  • acceleratoraccelerator Posts: 136
    Sorry for being a broken record here..

    Using my handy-dandy little lease calculator, I come up with the same monthly payment, but what I'm still a little confused about is what to figure in for misc. fees. I know with financing, you have the doc fee, title fee, inventory tax, license fee, and sales tax. On a $25k car, that adds up to $1845 so the amount being financed is $26,845 (assuming no trade). From this, I can figure what monthly payment would be and I'd be accurate +/- $15 depending on when the first payment would be due.

    When I went to the dealer, he said my calculations were off but he would not necessarily say where or why and yet when others post their numbers on this forum, I'm able to able to come up with very near figures to what dwayne and Car_Man have posted (I work through all their examples). I'm so frustrated I'm having second thoughts about even getting the S (okay, not really, I want the car too much) but you know what I mean.

    On a lease, do I still pay those fees I mentioned above? Car_Man posted in a different response to me about if $45 is too much that I might not want this car. While $45 wont break the bank, I just want to make sure I'm not getting rear-ended in the deal by the dealer sneaking in bogus fees.

    I found a lease worksheet on edmunds site and another one on carbuyingtips.com which are very helpful but again, you have to know the fees they are inserting just because and which ones they are inserting so they can bump up the cost.

    Frustratedly yours,
    accelerator
  • dwynnedwynne Posts: 4,018
    All those fees vary from dealer to dealer, city to city, and state to state - so it is hard/impossible for someone else to figure those for you.

    In most states, sales tax is due on any cap cost reduction you make, then tax is added to the monthly payment - but some states figure it differently.

    "Doc" fees, inventory tax, business tax, and those kinds of things are often added to deals and are (to me) just extra profit. So I usually ask for a price for the car w/destination and and dealer fees added - the no big surprises when signing the papers.

    Title fees and tag vary and have to be paid or rolled into the lease.

    The lease acquisition fee has to be paid or rolled into the lease. This is $595 for a Honda captive lease and varies with 3rd party banks.

    A security deposit may be due, the is the amount of your monthly payment (including tax) rounded up to the nearest $25 or $50 increment. Again, this varies from bank to bank and has to be paid or rolled into the lease. At lease end you get this back when you turn in the car and no damage/problems are found - of if you buy the car of lease end. Honda, and others, may offer no security deposit leases to returning customers or in exchange for a slightly higher money factor (with Honda it is 0.0001). Normally, if you run the numbers you are better off paying the extra and not rolling the security deposit into the lease - but it all depends on the amount and how much MF is costs. Some lease banks offer a reduced MF if you pay more than one month's deposit at lease signing!

    So you get the price for the car with destination and any dealer fees included, you add in the acq fee, the security deposit (if any), your taxes on the up front money (if any), the security deposit (if any), then the title and tags fees and that should be the cap cost for the lease. The residual and MF are what they are, and you run the numbers and get your payment - not including tax.

    Any dealer not willing to explain the numbers to you is not one I would want to deal with - I don't think. Before I sign anything it has to come out to the penny with what I figure, if not then I have to see why not or I don't sign. One example is a "old stock" car with a slightly lower MSRP number - that results in a lower residual that you might get using the current MSRP.

    I had dealer once give me a much higher number than I got using the MF and residual. When I called him on it he said "Oh I included our wheel and tire protection package. I do that in all my leases". Yeah right, all the ones where the buyer does not catch you adding hundreds in fluff money.

    The $45 comment was mine - the way I figure it a 48 month lease VS a 36 month lease would save $45 a month plus taxes, which is not that much on a $450 or so per month lease. If the $45 extra on the 36 month is a deal breaker - just too much money - then I would not lease the car.

    Dennis
  • acceleratoraccelerator Posts: 136
    Dennis,

    Thank you so much for outlining this. I was able to FINALLY arrive at a number much closer to what I have been quoted!

    This was an excellent write up (too bad it cant be made a sticky).

    Thanks again, Dennis! I don't feel so lost or overwhelmed now.

    Daryl
  • acceleratoraccelerator Posts: 136
    I've heard from dealers that Honda more than likely wont offer the lease specials since they don't want them back due to their slow sales. Is that just a dealer's pitch to incourage me to do the current deal OR is there some truth to this statement?

    I've got a deal on the table that I would be comfortable with doing but I'd be willing to wait three weeks to see next months incentive if there is a chance for the lease special.
  • dwynnedwynne Posts: 4,018
    That is a good point, but Mazda still did cheap leases on the RX-8 and they REALLY can't sell those. A dealer should be able to sell a used S for $20k or less off lease. Of course, the idea is the new lessee will love the car so much they will buy them off lease.

    If you can get the car for close to invoice less $2,000 including deal fees, that is a hot deal. Either buy at that price, 3rd party lease, or Honda lease - whichever is the best deal. Over in the price paid forum, a dealer in CA is offering a new 07 S for $28,888 or something like that. For those kind of prices, it is hard to go wrong on any deal.

    They may come back with cheap leases, but (like the current Accord deal) they are not likely to do incentive AND cheap lease on the same deal. When I checked, the cheap lease at invoice is better than the standard lease at $2k under invoice. But you don't KNOW for sure what they will do and spring is here :D

    Dennis
  • acceleratoraccelerator Posts: 136
    This is what they presented to me:
    48 months/48k miles
    msrp $34,845
    360.00
    $2860 down (I have $830 in negative equity I'm rolling over into the deal)

    How is this deal?

    Bottom line, is this a good deal? I'm happy with the monthly payment. I took it home overnight to see how it fits in my lifestyle and it is a pretty extreme ride (but that is for another thread/forum).
  • acceleratoraccelerator Posts: 136
    $360 after all is said and done with.

    Regarding the 48 month lease, my wife is really against this car so if I want it, I have to do 48 because once I have it, I wont be able to get another sports car of this calibur again. :) My wife also said due to the increase in insurance that $360 is my cap for a car payment. And about what my wife says, that is another topic of discusssion. ;)

    The cap cost reduction is $2500 and $360 is the first payment.
  • habitat1habitat1 Posts: 4,282
    So you will basically be paying $19,780 to lease a car for 48 months that you could buy outright for $29,000 + taxes? Again, I prefer to pay cash and buy, but if leasing is what it takes to get you (and your wife) into a great car, I say go for it.
  • acceleratoraccelerator Posts: 136
    While my current car is nice (all wheel drive, heated leather seats, turbo, sun roof - has just about every available option) but the drive is dull and boring, poor gas mileage (20.1 mpg which I track) I still had 50+ payments (traditional financing) and my monthly payment was around $350. $10 more (excluding the insurance increase), I get to drive the insanely fun S2000? :)

    To be honest, financing a $30k is out of my budget since my wife is starting her own home-based business and we aren't sure yet how it will do. Leasing is the only option for me.

    I may have to drop off the forums once I do the deal because Murphy's Law says that after you sign the deal, you'll find an even better deal next month. :)
  • acceleratoraccelerator Posts: 136
    I'm now the proud lesee of a 2007 Rio Yellow S2000 and I couldn't be more happier with my decision. I thought about waiting til next month to see what offers would be around but became impatient. :) I got an incredible deal on the financing terms. Could it have been better if I waited? Maybe. I got much lower than the .00285 money factor and given I rolled over almost $1000 of negative equity, I couldn't be happier with my monthly payment of $360.00 (not a penny more). I may not be posting for a while as I'll be out driving... Now what do I name her? ;) I'm thinking "Little Miss Sunshine" :blush:
  • Congratulations and enjoy her in good health. Thanks a lot for your response regarding the incredible $28,500 offer you got. Unfortunately, logistically it wouldn't be suitable for me as I live in New York and am currently engaged in a very heavy working schedule. In addition, either transportation or travelling expenses would cancel out the attractive selling price.

    I went back to the dealer today to take a close look at his inventory once again, and am thinking about switching from silverstone to new formula red. The red car is in exhibition and unfortunately it has 26 miles (I would prefer less than 10) on it, but it looks like fresh from the truck. Any comments about that relatively high number of miles at the time of purchase?

    Again, best wishes with your new toy.
  • acceleratoraccelerator Posts: 136
    Thanks, Don.

    My understanding is that they will all have at least 15 on it from Honda as it is part of their quality control. I'm sure someone here can chime in and confirm that.

    NFR was my 3rd choice color coice. When clean, the NFR looks almost like the paint is still wet. GPW was first choice with LBP my 2nd. Rio yellow wasn't even in my top 5 until I saw it in the sun and WOW! It is absolutely beautiful and I knew I found my baby!

    You could judge the stock number as to it's actual age if that would help. My two cents would be to look at the tires if you are concerned with HOW the 26 miles were put on the S. Look for the little rubber [non-permissible content removed] (I don't know what else to call them) and look at the edge of the rubber to see if it looks like threads have have been ripped. Make sense? :confuse:

    Your dealer wouldn't have to know about your work schedule. You could tell them you have family here so it would be easy to justify a visit. ;) Perhaps if they wont match it, maybe meet half way? Perhaps they can offer a lower money factor if you are leasing? I have a 4.00 interest rate, no security deposit and something else was waived but I can't recall what it was. I simply am paying for sales tax (required by law) and interest (again at 4.00% or in money factor terms, .0017). I found there are a ton of options available to the dealer, IF they want to sell the car. Heck, it may take some time but if you have multiple honda dealers within a close proximately, make/allow the to bid for your business.

    Keep us posted with what you find. Keey in mind that a new incentive will be out next month. Honda's special lease rate, IIRC, will be better deal than the deal I got, I believe. If the dealer has a large inventory and you are not at risk of missing out on the color you want, you may want to wait. Telling the dealer you want to wait may be enough incentive to help them sell you the car. You can also mention you are going to check out the Sky Redline/Solstice GXP in the meantime. Then see if they present you with anything attractive.
  • Thanks for your prompt and thoughtful reply. You got me itching with your deal, but again Texas would be a true logistic impediment for a New Yorker. Traveling/transportation costs alone would not justify the move.

    If this is the last year of S2000 production, as it appears to be, I intend to keep the car for the long pull. Leasing, therefore, is not in the picture.

    Thanks for easing my concerns about the 26 miles on the odometer. I'm a bit paranoid about the "high-rev test-driving style" that may have taken place already. Yes, I looked at the tires and to every other conceivable indicator of use and or abuse. It may be wishful thinking, but I theorize that a car standing on the sales floor is less likely to be test-driven than those on the dealer's lot. It is possible, therefore, that the car was delivered at the dealer's storage site several miles away, and for being red, it was chosen as a sales floor exhibition item.
  • acceleratoraccelerator Posts: 136
    Mine had 29 miles on it so I know exactly what you are feeling. :)

    Here is my thinking with the lease/buy route... $30k is roughly a $600/month car payment at a finance rate of 6% (rounded for easy numbers). Through my lease deal, I'm paying $360 at 4%. I can invest the difference ($240) and make more than 5%. Heck, even opening up an immigrant account will earn me 5%. My thought is that I will be in a good position to move into Honda/Acura's next great sports car.
  • Your leasing argument makes sense. By the way, I'm going to post a question about "odometer miles" at time of purchase and see what the consensus is.
  • I placed a deposit on a new s2000 over the phone. The salesman indicated that the color I wanted was in the storage site, with plastic coverage on it. However, when I got to the dealership, I found that the car was not at the storage site but rather at the dealership itself and clearly available for test driving. It had already 18 miles on it. I was immediately invited for a test drive. The engine felt tight and pulled more than I expected, the car was supreme. Yet the 18 miles on it are a sore point as it is obvious that it has been test-driven by multiple drivers already. The sales manager himself indicated that S2000s arrive with approximately 4 miles on the odometer. The excuse for the relatively high mileage was that the car has been driven back and forth from the storage site a couple of miles away.

    Discouraged by the potential problem of a test-drive car, I targeted the one on the sales floor, assuming that such a car would be less likely to be taken for a test-drive than those on the lot. The car looks like just-off the truck, yet I found out that it has 26 miles on it!

    We all know how sensitive high-rev engines are to break-in abuse, thus the thought that an enthusiastic kid may have rev it up to or near the red line without appropriate warm up concerns me a lot.

    Any thoughts please!!!
  • habitat1habitat1 Posts: 4,282
    You are smart to be concerned about potential abusive test drivers. That said, it's probably going to be tough to find an S2000 with the minimum 3-4 delivery miles unless you catch one literally coming off the delivery truck.

    My 2002 S2000 was also off the showroom floor and had 10 miles on the odometer. The sales manager appeared professional and claimed that the only miles the car had been driven were him taking the car for a 6 mile easy drive and gas fill-up. He did it with all the S2000's to make sure the car felt and sounded right before the sale. On cars that did get short test drives, he or one of his senior sales people went along to make sure of no abuse. They also didn't allow test drives by anyone under about 25 that didn't appear to have the abilty to purchase.

    Another dealer I went to at the time was far less professional (Rosenthol Honda, Tysons Corner). They literally tossed the keys of a new S2000 (still with plastic wrap) to me and said "let it rip". I wouldn't buy an oil filter from them, let alone a car.

    You may have to satisfy yourself with the professionalism of the dealership and their test drive practices, rather than try to find a new S2000 with only 3-4 delivery miles.

    If it's anly consolation, I never had any issues in 18,000 miles with my S2000 and have never had any issues with my 2005 911S that had 40 miles on the odometer when I purchased it. Same deal - sales manager went along for all rides. And, fortunately, fewer boy racers pass the "can afford" test on the 911.

    Good luck.
  • Habitat.

    Thanks for taking your time to express your thoughts. This fear about relatively extended odometer miles comes precisely from an experience I had when buying my 997S. The sales manager himself committed the crime. He knew I was trading-in two fast cars, and apparently wanted to impress me with the new 997 power/torque credentials by pressing the throttle all the way to the floor, on first gear, on a New and COLD Carrera that was available at the dealers' lot. By the way, that Carrera was sold a few days later to an unsuspecting customer. In short, one never knows. The car I'm about to buy may be fine, but certainly there is a risk involved.

    I'm going back to the dealer on Monday, and I will request a test drive on the one displayed on the sales floor which has 26 miles on it. I'll listen to the engine very carefully and to the exhaust as well. I have scrutinized all the potentially revealing signs of use/abuse on that car and have found nothing to worry about. I'm also going to ask for a printout revealing the "rev history" of the engine. I don't know the technical term for that but Porsche can run an engine test which would reveal whether or not the break-in has been carried out according to factory expectations. I doubt if Honda has a similar tracing technique though.

    I'm also thinking about offering the sales manager a significant down payment to induce him to order a car from the factory, provided I get it for the same price, $29,300. However, I suspect there are no more S2000s being produced.

    Again, thanks for your help.
  • acceleratoraccelerator Posts: 136
    FYI, my local dealer is expecting two new ones in two months (Rio yellow which the sales person is claiming) but you are probably right about the price. :)
  • acceleratoraccelerator Posts: 136
    You may want to post this question as a new thread on the main forum to get reach a larger audience...

    [Honda S2000 Forum]
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