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2013 and earlier Lexus RX 350 / RX 450h Lease Questions

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  • lj233lj233 Posts: 4
    I just leased an 07 RX350 from Lexus of Orlando.

    MSRP 40,301
    Price 34,525
    36mo/12k, same residual and money factor
    $1000 down (incl 1st month), $550/mo

    I was told I was getting one of only two 07s left at the $40k MSRP.

    $38,500 is way too high for an 07. Lexus of Sarasota quoted me $37,200 for a 2008.
  • richzrichz Posts: 125
    Car_man or anyone else,

    This will be my first time leasing so I am very new to this process. I am looking to lease a 2007 Rx350 AWD with the following packages: FT,HH,NV,PT,TO,WL,C1. In other words, the options are 18" wheels, heated front seats w/ rain sensing wipers, navigation system, premium plus package, towing prep package, wheel locks, and cargo mat.

    For the above vehicle I was quoted an MSRP of $38,800 + $6191 for the options + $715 destination charge for a total MSRP of $45706. For a 2 year, 15,000 miles/year lease the dealer is quoting me a total cap price of $42,463 and a residual value of $26,966.

    My questions:

    1) Does my total cap. price seem fair?
    2) I have one month left on my lease of an Acura SUV. The dealer is offering to pay for the last month on my lease. How should I value this when I enter in numbers in the Edmunds lease calculator? In other words, where should I factor in this number?
    2) What should the residual be for the above options on a 2yr 15k/yr lease?
    3) What should the money factor be for someone who qualifies for tier 1 credit. What about tier2? I was told I am tier 2 but that they were able to get me into tier 1.
    4) How do you (car_man) get the residual values and money factors that you cite? Should I be able to get exactly the money factor and residual values you cite?
    5) Why does the money factor depend on the options my vehicle has?
    6) On the edmunds lease calculator you have fields for "miles driven per year". Why does this matter if I enter an explicit residual value in the calculator? As I understand it the mileage I buy should only affect the residual value.

    I know I have asked a lot of questions, but I really appreciate your help!
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,518
    Hello lineman2. All lessees really have to do is change their vehicles' oil every several thousand miles and perhaps rotate their tires every once in a while to avoid excess wear that they will have to pay for at lease-end. In my opinion, performing any more maintenance than that on a leased vehicle is a waste of money.

    Car_man
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  • CarMan@EdmundsCarMan@Edmunds Posts: 38,518
    Hi cidsparks. In addition to the Lexus RX 350, you may also want to check out the Mercedes ML350, the Acura RDX, and the Audi Q7. I would say the Acura MDX, but there is not currently any lease support available on it. Take a look at the following discussion to get an idea of how much you will have to pay for this truck right now: "Lexus RX 350: Prices Paid & Buying Experience".

    Car_man
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  • CarMan@EdmundsCarMan@Edmunds Posts: 38,518
    Hi toddturner. Given the fact that Lexus is currently providing $1,250 dealer cash on the 2007 RX 350 and that the 2008 model is already available, I would not be surprised if you were able to negotiate a lower selling price than the one that you mentioned if you are in an area that has a decent level of competition and you comparison shop a little bit.

    Car_man
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  • CarMan@EdmundsCarMan@Edmunds Posts: 38,518
    Hi action80. I see that you are considering making a $4,300 down payment on the RX 350 that you are interested in. I always advise consumers against making down payments on leased vehicles. Those who do risk losing them if their vehicle is totaled in an accident or stolen and never recovered. You would be better off leasing your RX without making any sort of cap cost reduction, even though it means you will have a higher monthly payment.

    As far as this deal goes, the money factor looks good, but I suspect that you will be able to negotiate a lower selling price than the one that you were quoted if you are in an area that has a decent level of competition. You are only being given a $1,900 discount on this truck. This is really only like a $650 discount once the $1,250 dealer cash that is available on the '07 RX 350 is taken into account. See if you can negotiate a lower price than this.

    Car_man
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  • CarMan@EdmundsCarMan@Edmunds Posts: 38,518
    Hi richz. Since you are new to the world of leasing, you definitely should check out the following informative articles that are available here at Edmunds.com prior to visiting any dealers: 10 Steps to Leasing a New Car and Calculate Your Own Lease Payment.

    If you are in an area that has a decent level of competition, I would not be surprised if you were able to negotiate a better price than the $42,463 that you were quoted. This price represents a discount of $3,250 from MSRP, but this drops to only $2,000 once the $1,250 dealer cash is taken into account. This is on a truck that likely has a spread of more than $5,000 between its MSRP and dealer invoice price. Not to mention the fact that the 2008 model is already at dealers, making them more anxious to unload their remaining '07 models.

    The fact that the dealer that you are working with is making your final payment on your Acura for you is eating into the discount that you would normally be able to negotiate on your RX.

    Lexus Financial Services' current 24 month, 15,000 mile per year buy rate lease money factor and residual value for the 2007 Lexus RX 350 without the entertainment system option are .00275 and 59% for consumers who qualify for its Tier 1+ credit tier. The options that your vehicle has does not have any impact upon its money factor, but it may have an impact upon its residual values. Unfortunately, I am not aware of a resource that provides accurate information on manufacturers' lease programs to the general public.

    Car_man
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  • richzrichz Posts: 125
    Are you sure about the residual value being only 59%? This seems only very very slightly higher than after 3 years/15,000 miles. Also, I have seen people posting money factors lower than 0.002 in this thread. Was there some sort of support from Lexus that has now ended?

    In my original post I asked how you are getting the residual values and money factors. Do you have some sort of inside knowledge? I am asking this so I know how much I can trust your numbers if I try and negotiate with the dealer.

    Finally, what do you think about a 24 month lease vs a 36 month lease? I was thinking I could lease for 36 months and try to find someone to takeover my lease for the last 12 months if I don't want to keep the car any longer. I read the articles you linked to in your reply already.

    Thanks.
  • ms09ms09 Posts: 112
    hi, i saw lots well almost all discussions of price, can any1 tell when the next generation of the rx is coming? cause i found out today the new generation of lx is coming, which will be lx 570 v8 will be the first live appearance offically by lexus on april the 4. at ny auto show...but i am more interested when the rx next gener will be coming can any1 tell me, and the current generation which is this ? because i wasn't a fan of lexus before to be honest but now i am . so can any1 tell me which is this current rx generation?
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,518
    Yep, I'm sure. Lexus Financial Services' 24 month, 15k residual value for a base '07 RX 350 AWD is 59%. The number for an otherwise identical 36 month lease is 53%. Lexus was providing a special lease money factor on the '07 RX 350 in February, but this program is no longer available in March. For March it moved its special money factor to the 2008 model. The above numbers are definitely right, but you don't have to trust them if you don't want to.

    A 36 month lease will definitely provide you with a lower monthly payment than a 24 month lease would, but don't count on being able to easily find someone to assume the final year of a three year lease. Finding a consumer who is willing to assume your lease payment is often a lot easier said than done. Lessees often find that they have to sweeten their deal by paying money out of their own pocket to entice someone to take over their deal.

    Car_man
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  • CarMan@EdmundsCarMan@Edmunds Posts: 38,518
    Hi ms09. The 2008 Lexus RX 350 is not available at dealers, but I don't believe that it is significantly different than the 2007 model. The '07 RX 350 just got a new, more powerful motor and a number of interior upgrades, so I suspect that we will not see a major redesign of this model until the 2009 model year. This particular discussion is for consumers to talk about leasing an RX 350. Try posting your question in the following discussion for better feedback on when a redesigned RX will arrive: "Lexus RX 350".

    Car_man
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  • richzrichz Posts: 125
    Hey Car_man,

    I hope you didn't read my message wrong. I wasn't saying I don't believe you, I just wanted to make sure you sent me the correct numbers since 59% is also what the dealer ave me as the residual value but it just seemed a bit low.

    Thanks.
  • Thank you Todd. ;)
  • billmvbillmv Posts: 142
    CM......I'm sure you meant to say NOW instead of "NOT available at dealers" in your post from 3:19 AM. My Lexus dealer here in Marin County CA claims to have sold out of 2007s six weeks ago.

    Keep up the good work, and get some sleep!
  • richzrichz Posts: 125
    As a followup, I ended up negotiating the price of the vehicle to $40,000.
  • Car_man,

    You were a great help in getting me info for my RX330 lease. I now need some numbers for my father.

    He is interested in a $0 down, 3 year, 12k mile/yr lease on a 2008 RX350 (better to look for a 07?). Which I have priced out at $41,746.00, figure $39k negotiated price (premium plus, no nav). Can you tell me what he should expect to pay and what the current residual and money factors are.

    Thanks!
  • marqevansmarqevans Posts: 29
    I am about to lease my 5th RX, a 2008 rx350 with the first level premium package, heated seats and a towing hitch/ball. MSRP $42,100 My dealer usually offers to buy me out of my lease before I reach 3 years. The lease is a 36 month 15000 mile/yr lease with nothing down and sales taxes @ 7.75% rolled into the lease. The monthly payment will be $577, or $537 if I leave a $5,000 refundable security deposit. Does this sound like a good deal?
  • oiakouoiakou Posts: 18
    I am considering a 27mo lease. My credit is excellent. I don't drive the car that much, so 10K/year is OK for me. Please comment whether this is a good deal or not, and suggest a place were you might be able to get better rates...

    Car: 2008 RX 350 AWD, Navigation, Premium Plus.

    I am being offered the following lease terms:
    Term: 27 mo
    residual: 71%
    Miles/year: 10K
    Money Factor: 0.00275
    Total Initial Fees: 800
    Lease-End fees: 400

    Also, can someone post any prices paid for the car above?
  • dgrahamrdgrahamr Posts: 20
    To get the color/features choices that my wife wants, the dealer in the Boston area (Lexus Watertown) said we really ought to order the car. That's fine with us as we have lots of time, don't mind waiting 12 weeks. The dealer said we would agree on price before placing the order, and the leasing terms would be whatever Lexus leasing terms are when the car comes in and he sells to us. That's fine with me, but only seems to work correctly if the dealer has no discretion on leasing terms. I think that's right -- I think the dealer negotiates price and sells the car to the leasing company, and that Lexus doesn't give the dealers flexibility to modify leasing terms to get the deal done. But can someone confirm this? I want to be sure I don't get nailed on ugly leasing terms if I go this route. Let's assume for this purpose I can negotiate a price I am happy with.
  • billmvbillmv Posts: 142
    Your dealer should lease it to you using Lexus Financial Services, so it's an in-house deal. They can use a local bank, but then you can't find out from forums like this what their money factors and residuals are. So the dealer isn't selling the car to the leasing company. You should get a better deal using LFS.

    Lexus sets the MSRP and the residual value (a function of months and miles). It also sells financing to the dealer for X. The dealer controls the selling price used in the lease calc when they cut a deal with you.

    LFS "sells" the financing to the dealer for X, which the dealer can then mark up when they use it to calc your lease payment (the "money factor"). Just like a bank does when they buy money from the Fed and turn around and lend it to you at a higher rate. So you MUST get it in writing NOW that they will use the "buy rate" money factor which happens to be in effect at the time your car arives. It changes monthly, and is set by Lexus. However, Lexus allows the dealers to mark that up to make extra profit.

    The acquisition fee (about $695, I think) is also set by Lexus, but they allow the dealers to mark that up too, so the dealer might add $200-$300 there.

    So agree on a price and insist that they use the buy rate money factor and standard acq fee.
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