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2013 and earlier Volvo XC90 Lease Questions

CarMan@EdmundsCarMan@Edmunds Posts: 38,515
edited February 2 in Volvo
Hi everyone. Please use the following discussion to post any questions that you have about leasing a Volvo XC90. Thanks.

Car_man
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  • Carman,

    Please give me an idea on a 36 month lease for XC90 V8 with Touring, Convenience and Climate pkg. I was given a lease quote of $620 a month incl tax for 36months for 15k miles per year with $1k down. I believe the selling price was approx $45k with msrp of around $54k. My sales tax is 7%. Is this a good deal?? Thanks.
  • Hi glockfan. Let's work up a lease payment on the truck that you are interested in using Volvo Finance's actual September lease program and see what we come up with. According to my calculations, if you were to lease a 2006 Volvo XC90 V8 with an MSRP of $54,000 and a selling price of $45,000 through Volvo Finance right now for 36 months with 15,000 miles per year, your zero down, pre-tax monthly payment should be around $593. With a $1,000 down payment, the monthly payment for an otherwise identical lease would drop to around $562. As you can see, these payments are considerably less than the one that you were quoted, probably even after tax is taken into account, so something does not add up. Ask your dealer if they are using Volvo Finance's buy rate lease money factor of .00330 to calculate your truck's lease payment. This factor is already bad enough, it would be worse if the dealer that you are working with was marking it up to add additional back-end profit to your deal.

    Car_man
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  • What is a good lease price for the 2006 XC90 2.5T AWD. Lease term is 36 month, no money down, 16,500 miles per year. Tax rate is 7.25%.
  • HI johns3. I would be happy to give you an idea of how much it should cost to lease the vehicle that you are interested in. However in order for me to do so I need you to tell me its full MSRP and give me an approximate selling price for it. All of that information is available here at Edmunds.com. You can find its MSRP in the New Vehicle Pricing section of this site and you should be able to get an idea of how much you should pay for this truck right now by visiting the following discussion: "Volvo XC90: Prices Paid & Buying Experience".

    Car_man
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  • cv2006cv2006 Posts: 23
    Hi Carman,

    We are looking to lease a 2006 XC90 2.5T. What would be a good lease payment? At one dealership, we were quoted an approximate monthly payment of $497-$530 plus tax, $730 in inception fees for a 4 year term with 12K miles per year. Another dealership quoted us a monthly payment of $529 plus tax and $1500 in inceptions fees. The MSRP is $47,620 and the approximate selling price was under $44K. This is the first timethat we are considering a lease, so we need help.

    Thanks!

    Rita
  • Hi Rita. 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.

    I would be happy to estimate what your lease payment should be like for you on the XC90 that you are considering. According to my calculations, if you were to lease a 2006 Volvo XC90 2.5T AWD with an MSRP of $47,620 and a selling price of $44,000 through Volvo Finance right now for 48 months with 12,000 miles per year, your zero down, pre-tax monthly payment should be around $634. As you can see, both of the lease payments that you were quoted look attractive to me.

    Car_man
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  • flbenflben Posts: 1
    Hi Car_man,

    I am interested in leasing a XC90 2.5T with 3rd row seat for 36 month with 12K miles per year. MSRP including all fees is $41958.00. the selling price is $38800.00. what should my monthly payments be with 0 cost Cap. reduction and considering the volvo's current incentive?

    Thanks.
  • merckxmerckx Posts: 565
    You mean the XC90 is currently typically selling for $9,000 off MSRP? I wouldn't think the discount would be quite that high...
  • I just leased a 2006 XC90 2.5T FWD, premium and versatility packages yesterday. Lease is 42 months, 12K/year. With no additional cap cost reduction, our payment would have been $510. We put $2K down to make the payments $450. Had a great, easy transaction. The dealership worked very hard to earn our business. Even had other dealers tell us if we could get the car for that, then do it (so we did). Hope this helps a little bit. BTW, the MSRP on the car was $41,430 (no metallic paint). Good luck!
  • I'd be happy to estimate what this vehicle's lease payment should be for you, flben. According to my calculations, if you were to lease a 2006 Volvo XC90 2.5T AWD seat with an MSRP of $41,958 and a selling price of $38,800 through Volvo Finance right now for 36 month with 12,000 miles per year, its zero down, pre-tax monthly payment should be around $582.

    Car_man
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  • Hi merckx. I was only using the MSRP and selling price that the poster I was responding to told me they were quoted. You are absolutely right, there's no way that anyone is getting a $9,000 discount on this model right now.

    Car_man
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  • Thanks for taking the time to share the details of your lease with everyone, lmueller.

    Car_man
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  • I've got a 2 year old XC90 on a 4 year lease with incredibly low mileage for its age (I'm about 10k under my limit). I would be interested in approaching a dealer and seeing if they would be willing to take my existing vehicle and get me into a 2006 XC90. I suspect that with the low mileage, the car is quite attractive to the dealer as he could re-sell it quickly.

    I've noted that the monthly lease costs for the new model would actually be lower than my current lease due to some Volvo incentives. I've received mixed feedback on the feasibility of getting out of the current lease and leasing a new XC90. Can you offer any advice? My lease was dealer arranged through a bank.
  • Car_Man, I've recently been offered the following deal:

    2006 Volvo XC90 2.5T FWD
    Premium Package
    Versatility Package
    Premium Sound Package
    4 yr./50K Warranty
    MSRP: $42,180
    Invoice: $39,276

    LEASE
    36 months @ $479 + tax
    45,000 Total Miles
    $2000 Due at Signing

    Is this a good deal? Thanks, SAM1116
  • I've recently been offered the following deal:

    2006 Volvo XC90 2.5T
    AWD w/ Instant Traction
    Metallic Paint
    Premium Package
    Versatility Package
    Convenience Package
    Navigation
    Climate Package

    MSRP: 47,770
    Sales Price (w/out tax): 41,800

    Lease terms: 36 months/45,000 miles
    $675/mo including tax

    Upfront costs: 1st month payment, refundable security, registration fee, bank fee: $2240.

    The TGV for this car as equipped is 44,301. There is a current promotion that makes the premium package (invoice $2575) "free." Backing this out of the TGV, I arrive at 41,736.

    The lease terms seem very high to me. Your advice is appreciated.

    Thanks.
  • davindavin Posts: 2
    Car_Man,

    I am looking to lease the above for a 36 month lease and 12,000 miles per year. I spoke with two different dealers in the Philadelphia area and they are both quoting lease prices with U.S. Bank as the lender, rather than Volvo Finance. The vehicle I am interested in would have:

    Premium Package
    Climate Package
    Versatility Package
    Convenience Package
    Xenon Headlights
    Dual Screen DVD Player

    The residual being used is 56%. I am trying to find out what a competitive money factor is. The details of the lease are:

    $1,500 out of pocket at signing (no cap cost reduction)
    $536/month, which includes tax

    I believe the selling price is approximately $41,000, but I do not have the exact number. Can you please let me know what a competitive money factor is and whether you think this lease is attractive. I apologize for not having the exact selling price. Thank you.
  • Hi SAM1116. You never mentioned the selling price of the XC90 that you are interested in leasing. This is an important number 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 the price of the truck that you want to lease you don't know how good a price you are getting it for. The second reason is that one needs the selling price of a vehicle that they want to lease is that it is necessary to calculate its lease payment. I would be more than happy to give you my opinion of this deal if you let me know what the selling price is.

    Car_man
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  • Hi merrill4. Let's work up a lease payment on the truck that you are interested in using Volvo Finance's actual lease program and see what we come up with. According to my calculations, if you were to lease a 2006 XC90 2.5 AWD with an MSRP of $47,770 and a selling price of $41,800 through Volvo Finance right now for 36 months with 15,000 miles per year, your zero down, pre-tax monthly payment should be around $614. It is difficult for me to say exactly what this payment would be once tax is added in, but it is a lot closer to the high payment that you were quoted than I though it would be. Unfortunately, Volvo's lease program on the XC90 is just not very good right now.

    Car_man
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  • Hi davin. I am not surprised that the dealers that you have visited are quoting you leases that are being run through a bank other than Volvo Finance. Volvo's lease program on the XC90 is not very good right now. Its current buy rate lease money factor for the 2006 XC90 2.5T AWD is .00285 for 36 months. This is equivalent to an interest rate of around 6.84%. You should be able to do better than this through an independent bank.

    The lease payment that you were quoted actually does not look that bad to me. I've seen much higher numbers being quoted to consumers on this vehicle. It is difficult to give you my full opinion on this deal though without knowing the full MSRP of the XC90 that you want. Without this number, I can't see how much of a discount you are being given on it.

    Car_man
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  • Hi Car man,
    What do you think of this deal?
    2.5T XC90
    versatility,premium,convienence packages, premium sound,dvd entertainment with MSRP of 46,500, invoice of 41,900.
    Lease for 36 months/15,000 a year,$4000 down payment, monthly payments between $550-575 . Can I do better, or is this a fair deal, thanks.

    Helpless in Houston
  • Car Man,
    I am purchasing a car for the first time without my dad...on my own so I am afraid I may be taken advantage of since I am a woman. Is the following a good deal?

    2006 XC90 2.5 AWD, metallic paint, leather, Premium Package, Versatility Package and Convenience Package for $38,000 (the MSRP was $44,535).

    Should I go for it? By the way I am in Boston.
  • britsbrits Posts: 3
    I have a S-80 coming of lease and have been offered the following on a 2006 XC 90 2.5T. The vehicle has premium and versatility package and is stickered at $41,908. They are going to sell me the car for $36,021. They also told me if I lease it with Chase they have some tax credits for me. Only first payment out of pocket for 36months 15k a year $576 a month including all taxes. Does this sound like a fair deal. I am only paying $517 a month on my S-80 and was close to the same price. Credit score is 820.

    Thanks in Advance
    Mike
  • jabberjabber Posts: 56
    Carman or anyone else,

    I've been told by a Volvo dealership that on a 2006 2.5T AWD:

    36 months
    Residual = 56%
    MF = .0023

    The residual seems low and the MF high...can anyone confirm this?

    Also, the salesman told me I would have to pay $877 in gap insurance. I've been leasing for a long time and have never paid for gap insurance, it's always been included as part of the terms of the closed end lease contract. Can you confirm whether this is a disingenious attempt to pad the dealer's profit.

    All that aside, the price seems to be okay at $3K under invoice.
  • In N. CA, 2006 XC90 2.5T AWD, MSRP $44,500? including Dest, selling $38,958, prem, vesa, climt, 48mo, 15,000K, 45%, 0.00198, $500 out of pocket and $528/mo. + Tax.

    We didn't think it was the bottom line but thanks to this site we knew it couldn't be bad. Mentioned Costco memebership the dealer (Winter Volvo in Sacto.) showed the invoice and their bottom line on the first try. All matched what we learned from here.

    Our lease contracts in the past never mentioned gap insurance, and we were told by our insurance it is only useful for the first year.
  • jabberjabber Posts: 56
    Okay, I finalized this deal on new year's eve and believe it's more than fair (I hope - feedback would be appreciated).

    Premium Package
    Climate Package
    AWD
    Dual Screen Rear-Seat Entertainment

    36 Months, 15K miles/yr
    MSRP $44,250
    Selling Price $37,296 (about $3740 under invoice)
    MF: .0019 (Wells Fargo Platinum - FICO>745)
    Residual: 55% although they residualized $850 worth of package discounts making the effective residual almost 56%
    Rolled into lease NJ taxes, MV fees, Doc Fee, and $795 Acquisition fee.

    $530 due at signing (first month's payment)
    $530/month

    I will also apply for $500 rebate through AAA mid-atlantic volvo program, basically making my first monthly payment $30.
  • Best lease deal I have seen so far jabber, congrats! I made a mistake, our MSRP was $43,550. We opted for the third seat instead of DVDs. Our selling price was $38,300 plus $495 acquisition fee. We did get two season ski passes worth $700.

    I was told with AWD no chain is required in the snow, we'll see.
  • BTW jabber, can you give me some details on the AAA-Volvo rebate program? Is there a number to call for more info? Thanks
  • jabberjabber Posts: 56
    Volvo has affinity programs with various associations (AAA, Volvo Club of America, Bar Associations, Credit Unions, Trade Associations, etc).

    Go to www.volvoprogram.com

    Each association has it's own code that you'll need to register and obtain a form to file to get the rebate. As far as AAA is concerned, you need to be a member of a specific regional club that is part of the program. The code for AAA Mid-Atlantic is CDLFfc3. ** You have to have been a member of the association for at least 6 months prior to your purchase in order to qualify. **
  • Thank you so much jabber, I entered the site with the code you gave me, it returned with California State Automobile Association (I am a long-time CSAA member) rebate program, and the expiration is 01/03/06. I called the number and was told since I purchased the Volvo before 01/03/06, I should qualify.

    I am mailing in my rebate request and see what will happen. Again thank you for the headsup.

    BTW, before I tried your code, I called every organization I could think of, from Volvo, AAA to dealers, no one had a clue. Out of desperation, I decided to try your code and CSAA popped out right in front of me. So I wouldn't believe it until the check is in my hand.
  • jabberjabber Posts: 56
    jacmyoung2, that's interesting. Perhaps that's the general AAA code and then based on your zip code it determines which club you belong to. I'm sure you'll get the check - congratulations. You can send my finder's fee to my paypal account! ;-). Enjoy your XC90.
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