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2013 and earlier Lexus ES 350 Lease Questions

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  • guugosguugos Posts: 10
    I ma starting my negotiations with 2 dealers this weekend. will share what I get asap.
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Hi lscnewport. I believe that Lexus Financial Services' March buy rate lease money factor for the 2011 ES 350 is .00175 for consumers who qualify for its top aka "Tier 1+" credit tier.

    Car_man
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  • scoot84scoot84 Posts: 21
    Hi Car_Man,

    I saw in your previous post you listed the March MF as .00175. Do you also know the residual for 36 months with 12k miles per year?

    Thanks so much.
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Hi scoot84. Yes that money factor is correct. Lexus Financial Services' March residual value for a 36 month lease of a 2011 ES 350 with 12,000 miles per year is 57%.

    Car_man
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  • sjeedsjeed Posts: 41
    edited March 2011
    Car_man: Any chance that you have the money factors for Tiers other than 1+? Due to economic circumstances over the past couple of years I know that we are no longer at Tier 1+, or even Tier 1. I wish to rebuild our credit but don't want to be taken advantage of. We have already been pre-approved by Lexus Financial, but the dealer is quoting a MF of .00555 for a 36 month lease, which is the highest I have ever paid for a lease. That said, I believe FICO is not what it used to be, probably high 5's to low 6's. Thank you.
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    I certainly do sjeed. A credit score in the high 500 to low 600 range probably qualifies for Lexus Financial Services' Tier 6 (609-580 score). LFS' buy rate for that tier is .00515. this is a little lower than what you were quoted, so make sure that the dealer uses that rate to calculate your payment.

    Still, this is a pretty bad interest rate. We're talking about a "special" rate that's over 12%. If I had to pay that high a rate, I personally would look into financing or leasing a less expensive vehicle.

    Car_man
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  • Can you please list the money factors for march for the other tiers 2-4 and what the score range is? Finally, aside from the $1000 rebate for the IS350 are there any other incentives. I'm looking to lease one today for 36 months.

    Thanks,

    Gator
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Hi Gator. Lexus Financial Services' credit tiers are as follows:

    Tier 1+ 720+
    Tier 1 719-690+
    Tier 2 689-670
    Tier 3 669-650
    Tier 4 649-630
    Tier 5 629-610
    Tier 6 609-580
    Tier 7 579-520

    Car_man
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  • Hello,

    Great forum here!

    I am getting close to pulling the trigger on a 2011 ES 350 with "Package B" (Nav, rear cam, etc.). List price on this is $41,470. Selling price is at $40,000 at this point.

    This is where I am before any real negotiating with the dealer:

    36 month lease
    .00220 Money Factor
    $3000 down (which covers fees and license). Cap reduction is only at $451.
    12k miles per year

    Payment $631.17 per month

    Money factor seems decent. How far down can I negotiate the price of the car? Might they go down to $38,000 with the options I've chosen?

    Any advice or input as to whether this is a good deal would be HUGELY appreciated!

    Thanks much!
  • sjeedsjeed Posts: 41
    edited May 2011
    I was about to do the same transaction in mid-April, and only didn't because I didn't want to spend that much money right now. That said, having owned and leased about 8 Lexus vehicles I feel I have a pretty good handle on these transactions and working with dealers.

    The deal I had was $500 above Invoice, for basically the same car, for which the MSRP was 41,460, and the selling price was $38,214. This was in Northern CA.

    You didn't state whether there will be a security deposit, but if you have been a prior customer of Lexus, they often times waive the security deposit (depending on your prior experience) and offer a $1,000 cash rebate for a new finance or lease. I believe the lowest money factor for Tier 1+ credit was .00175 in April. And the residual was 57% for 12k/yr miles.

    So, the bottom line is I think you can certainly do better on the selling price, and depending on your credit score you might be able to do better on the money factor as well.

    Hope that helps.
  • sjeed: That helps a great deal. Thank you!

    They are not asking for a security deposit. Residual is 58% with 12k miles per year. My credit score is currently 751 which, I believe, gets me to Tier +1.

    I'm guessing, if I can negotiate down to around $38,500, I should get my payments to about $580 including tax. Even a bit lower if I can get a lower money factor.

    I just finished a lease on an Acura so my lease history is strong.

    Thanks again!
  • jtiger3jtiger3 Posts: 3
    edited June 2011
    I have a leased vehicle. The option to purchase the vehicle is less then the trade in market value of the vehicle according to NADA and Kelly Blue Book. Just curious if anyone has every convinced a dealer to buy their leased car and give you the positive equity credit towards your next lease.
  • qkslvrqkslvr Posts: 34
    I may be in the same situation. I don't think the dealer has much of an incentive, since they get to either take the car or let it go to auction if you don't exercise your option. You would probably have to buy the car first, then trade it in. In some states, you owe sales tax when you exercise the option, although you would get a trade in credit for tax on the purchase.
  • Car Man,

    Can you give me an idea on how hard it would be to get a 2011 ES 350 for around $450-$500/month after tax on a 15,000 mile lease? I would like it fully loaded so MSRP would be somewhere between 41,000 and 42,500.00. Credit score is low 700's and would put 3000 to 4000 down. Im buying out of New Orleans.
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Hi jcrews5508. Let's work up some payments for you. According to my calculations, if you were to lease a 2011 Lexus ES 350 that has an MSRP of $42,000 and a selling price of $39,000 through Lexus Financial Services right now for 36 months with 15,000 miles per year, your zero down, pre-tax monthly payment would be around $543.

    Putting money down as a capitalized cost reduction would bring this payment into your target range, but to be honest with you you would be better off going with a zero down lease and having a slightly higher monthly payment. Consumers who make large down payments on leased vehicles risk losing part or all of them if their vehicle is totaled in an accident or stolen and never recovered.

    Car_man
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  • Thanks Car Man,

    Two follow up questions. One, is this a good time of year to get the best deals on a Lexus and two, how much can I expect Lexus salesmen to negotiate on Es pricing?
  • Car Man,

    Just left the dealership and am a bit confused by my current offer. For a fully loaded es 350 with an MSRP 43,006.00 a sales price of 41,800.00, a money factor of .00270 and a residual of 58%, im currently being offered a monthly payment of 653.00 after 3,300.00 down. To me this sounds very high. Am I correct and will Lexes negotiate on the money factor. My CS is in the low 700's.
  • mrussomrusso Posts: 9
    My ES350 lease is up 08/22/2011. I called my Salesman and discussed the 3 options available. The lease purchase option price is less than Market price [a little less than 10k miles on my car]. He said that if I wanted to buy a new Lexus, I would get credit for the difference between market and lease purchase price - which is about $2k plus the $1k loyalty credit.
    I am considering buying my leased vehicle [2008 ES350 with nav] for $23k. I know the history of the car; it has been a great car.
  • charliern9charliern9 Posts: 22
    I have the same situation as messenger #612 - if you elect to purchase your leased vehicle would you be able to finance the purchase price for 3-4 years? Do you think receiving credit for the difference between market and lease purchase price - which in the case presented in message #612 was about $2k plus the $1k loyalty credit. The car I'm considering buying is my third ES lease. Thanks so much for the excellent service you provide.
  • qkslvrqkslvr Posts: 34
    edited July 2011
    Hi carman, can you give me the lease money factorand residual rates for a 2011 es350 10K miles/year, both 36-48 months?

    Thanks!
  • jtiger3jtiger3 Posts: 3
    edited July 2011
    Just got off the phone with my Lexus Dealer - 36 months/10K - MF .0018 and res - 59% - selling price offer $500 over invoice (MSRP $39610/sell $36944 before 1K discount)
  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    You're welcome jcrews5508. No I definitely would not say that this is the best time to get a new Lexus. It is very difficult to predict what automakers will do with their future incentives, but if I had to make an educated guess I would say that the lease offers on the ES 350 will be more attractive later on this year as Toyota's inventory grows and we approach its annual "December to Remember" sales event.

    Car_man
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  • CarMan@EdmundsCarMan@Edmunds Posts: 38,515
    Hi jcrews5508. The money factor that you were quoted is definitely way too high. Lexus Financial Services' current buy rate for the 2011 ES 350 is only .00180 for consumers who qualify for its top aka "Tier 1+" credit tier, which it sounds as though you do.

    It would be in your best interest to shop around to see if you can find a dealer that will be willing to lease you this car using the buy rate.

    Car_man
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  • qkslvrqkslvr Posts: 34
    jtiger3, was that $500 over invoice before, or after the rebate? May I ask what state you are in?
  • jtiger3jtiger3 Posts: 3
    before the rebate - so the final sell price would be $35944 - NJ
  • I set up a 2011 ES 350 with heated seats on the Lexus website and got a sales price of $38,775 including delivery (I'm in CT). 36 month, 10k mi/yr, excellent credit and a $4,000 trade in (adjusted gross cap cost is $34,775) yields a monthly payment of $453

    I set up a 2011 Infiniti G37x on their website with a sales price of $38,295 but you have to add back to that a $700 destination charge. Again, a $4,000 trade in (so adjusted capitalized cost is $34,995), 36 month, 10k mi/yr, excellent credit. The resulting payment is $346/mo.

    Is Lexus's interest rate so bad that it really adds almost $4k to the price over the term? Do the two sites do something differently? Did I just screw something up?

    I really can't see paying that much more in interest - I never even carry a credit card balance.

    Thanks for helping me figure out what I'm missing.

    (BTW - Lexus's local deal must just be based off a better interest rate, right? Details below - assuming I can add the heated seats, it looks like the difference must be in the rate, although this still leaves a gap compared to Infiniti)

    LEASE*
    2011ES350
    $389mo.36mos.
    $3,789due at signing.
    Excludes official fees, taxes and dealer charges. No security deposit required.
    *Available on approved credit to qualified customers through Lexus Financial Services and participating Lexus dealers on a new 2011 ES 350. Not all customers will qualify. Offer based on MSRP of $38,995 for ES 350, including delivery, processing and handling. 36 monthly payments total $14,016. Monthly payment may vary depending on final price of vehicle & your qualifications. At vehicle turn in a disposition fee will be charged. You pay maintenance, insurance, excess wear & tear & $0.25 per mile over 10,000 per year. Lease-end purchase option price $23,007 plus taxes & fees. See dealer for vehicle and lease program details. Must take delivery by 9/6/11. This offer is available in the Lexus Eastern Area.
  • paprofpaprof Posts: 6
    Lexus puts a very conservative residual factor on their leases (around 59% of the MSRP for a 10K lease). I found Infiniti was much more aggressive with residuals in the 60s.

    I'm at the end of my lease for a 2008 ES350 and the ratio of current private party value to original MSRP is about 68%. That's about $4000 more that I paid on my 36 month lease (or about $100 per month) than the actual depreciation.

    The good news is that I will negotiate to put this "equity" into my next lease by lowering the cap cost by $4000. I'm pretty sure they will go for it because the spread between the dealer used price and trade-in value on kelly blue book is almost $6000 (i.e. the dealer used price is almost $10K more than the lease purchase price). I'm shooting for invoice less $4000 less $1000 loyalty bonus.

    Of course, the downside is that:

    a) this is a form of "enforced savings" by Lexus - you get no say
    b) you bear more of the risk for the future value of the vehicle
    c) you pay interest on the inflated depreciation

    Given the low interest rates, I'm happy to eat the (minimal) extra interest but Lexus will feel more pain from customers if interest rates go up.

    I'll keep everyone informed on my progress...
  • 10sfan10sfan Posts: 136
    IS there an acquisition fee to be added and what are the average dealer fees? Other factors to consider when calculating the true monthly lease cost.
  • paprofpaprof Posts: 6
    Yes, I was quoted a $700 bank acquisition fee and dealer doc fees (another $300). There is also a "disposal fee" for the car as well at the end of the lease. Excess wear and tear charges are also a factor if one manufacturer is more stringent than another. For instance, if I recall correctly, Honda allowed $3000 of excess wear and tear as part of the basic lease agreement.

    In reference to my previous post on equity in a lease, the dealership I visited in New Jersey on the weekend would only offer $1000 for the trade-in, claiming they could buy it at auction for $20K (even though KBB shows the trade-in value at $23K).
  • qkslvrqkslvr Posts: 34
    I traded my 2008ES350 lease in, they initially offerred $1000, but when I showed them a carmax offer to buy, they matched it at $3000. Most Texas dealers won't give you the buy rate, so I negotiated the sales price first , then had the finance guy reduce the selling price to offset his buy rate profit.
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