Lease Questions - Ask Here

kyfdx

1) If you own your car now, and are in no hurry, I would definitely wait... Prices can only come down from here..

2) You can trade your car in, and they will pay you for it. There is nothing that requires you to put that money down on the lease. The dealer derives no benefit, either way.

regards,
kyfdx

inbjce

Car_man,
I have a dealer quote on an ES-330 with NAV (48/12,000) as follows:
MSRP: $37,709
Sale Price $35,000
$0 down
$3800 cash back
trade-in worth $4000-$5800 (depending on which website you believe)
$462/month (includes 7% tax)
$17,438 residual

I am leasing because it seems that the lease/purchase costs the same out of pocket as the purchase (assuming 5% at 60 months on the purchase and that I do not pay off early). This allows me to invest my $$ and enjoy a lower monthly (I already have the $17,500 on hand to purchase if I choose).

Is this a fair lease?
What should the money factor be from LFS on this lease for a top tier credit rating?

Thanks for the help....this is the most helpful discussion board I have seen here.

tomtrav1

sounds like a good price.i have been comparing lease payments on an accord lx coupe special edition and the best so far is 279 mo.with 1028.00 down +67.00 mv fees.this is through the AAA lease program.(3yrs-36k)

lookin4adeal

Car-man

Could you give me the 36 and 24 month residuals for this car at both 12k and 15k. Also what is the money factor these days on a Jaguar? A dealer here as one priced down to 26488, and then of course there is the 3500 in factory to dealer. So I think I should be able to get this at a steal.

Thanks

John

gi2indking

Hey Car_man,
I was wondering if you could work some numbers for me. I know that Infiniti is offering some lease support on the G35 coupes now. I would like to know a monthly payment for the following configuration:

2005 G35 6MT Coupe
MSRP - 34,310
Negotiated Price - 31,900
36 or 39 months with 12k miles per year
$0 down

Also, how much will be due at signing?

Thanks so much!
Keith

Jaynj1

Thanks Car_man,

I forgot to give you info about A8L.lease. I would like to lease for 42-48 months. If possible with no down. Does it matter if I lease for 36 months? I know my payments will be higher, but would I pay less for more residual?

Thanks again.

Jit

trickydick

Car_Man,

I'm looking to lease a 2005 Acura MDX Touring (but no DVD and no navi) in New Jersey. Standard 36 month/36,000 lease. The only option I'm adding is running boards. I was quoted $37,474, which includes the running boards, + 6% NJ tax, + license and registration ($319), + Doc Fees ($78) for a grand total of $40,134. The lease offer is for either $0 down, $552 per month or $552 down, $534 per month. Does this sound like a good deal? Do these numbers work? Or do you need more info?

Thanks.

TrickyDick

gadarman

I'm interested in leasing, but am in the military. Do the typical lease contracts contain a military clause that allows the leaser to return the car if the service member gets deployed to Iraq?

mcho3

the selling price that i got is 75,000, but the msrp is 77,000.
they told me that for lease for TDF $1700 Monthly $1144 15k Money factor 0.00173 residual 46% for 48month. what is the best way to find out what how good of a deal that i am getting. sorry it took me so long to get back to you. mike

CarMan@Edmunds

Hi reechz. Generally speaking two year leases are more expensive than three year leases. The reason for this is that new vehicles experience their highest rate of depreciation during the first twelve months of ownership. By leasing to three years rather than for two, consumers are able to spread out this large depreciation hit out over an additional twelve payments. Having said this, for the past several months, for some reason Nissan has been providing a ton of lease support on two year leases of the 2005 Altima, making them very attractive. This is a win - win situation for both you and the dealer that you get your car from. They get to sell you a car, you only have to keep it for two years before getting something new, and they get the opportunity to sell you another vehicle a year earlier than they would have had you signed a three year lease.

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CarMan@Edmunds

Here is the information that you are looking for, Paul. According to the latest information that I have seen, if you were to lease a 2005 Acura TSX without navigation through American Honda Finance Corp. right now for 3 years with 15,000 miles per, its base lease money factor and residual value should be .00240 and 57%, respectively.

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CarMan@Edmunds

Hi apress12. Nissan is currently providing a decent amount of lease support on the 2005 Pathfinder. The redesigned version of the Pathfinder has been relatively well received by the public, so Nissan doesn't have the level of lease support that it had on the previous generation yet. If you lease one in May, you definitely want to do so for 39 months. This is the "sweet spot" so to speak with this model lease program right now. If you provide me with the full MSRP and selling price of the Pathfinder that you are interested in, I can tell you what its zero down, 15,000 miles per year lease payment should be. For any more miles than that, you would have to purchase additional miles on a per-mile basis. You may be able to get an idea of how much you should pay for this truck right now by visiting the following discussion: "Nissan Pathfinder: Prices Paid & Buying Experience".

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CarMan@Edmunds

Thanks for the information, davidd3. Let's work up a sample lease payment on the car that you are interested in for you. I will have to base it on 15,000 miles per year. If you need to drive more than that you will have to purchase additional miles on a per-mile basis. It is cheaper to do so at lease signing than it is to pay an excess mileage penalty at lease-end. According to my calculations, if you were to lease a 2006 BMW 325i with an MSRP of $36,945 and a selling price of $35,945 through BMW FS right now for 36 months with 15,000 miles per, your zero down, pre-tax monthly payment should be around $522. I used a money factor of .00255 and a residual value of 61% to arrive at this payment. The only difference between leasing this car in New York and in the rest of the country is that in your state BMW FS' normal lease acquisition fee of $625 is increased to $900. Rolling the $900 acquisition fee into your car's cap cost would increase your payment to around $549. I am a big fan of not making any sort of down payment when leasing, though I personally usually pay the acquisition fee and security deposit.

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CarMan@Edmunds

Hi mgz2400. Saab 9-3s are usually going out the door at fairly close to dealer invoice these days. A base 2005 9-3 Linear Sedan has about a $1,500 spread between its MSRP and dealer invoice price. As a result, I think that you probably could negotiate this car's selling price down another could hundred dollars. Also, Saab Financial Services Corp.'s current base lease money factor for a 3 year lease of this car is only .00014. The factor that you were quoted is higher than this, leading me to believe that the dealer that you are working with may be trying to mark it up to add additional back-end profit to your deal. Of course, the .00014 factor assumes that you pay a security deposit and acquisition fee. If you are having either waived, it would explain some of the difference. The $3,500 lease cash that you were quoted is correct. I personally think that there is a little room for negotiation left in this deal.

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CarMan@Edmunds

Greetings 3boy. According to the latest information that I have seen, if you were to lease a 2006 BMW 325i through BMW Financial Services right now for 3 years with 12,000 miles per, its base lease money factor and residual value should be .00255 and 63%, respectively. If I am not mistaken, I believe that BMW FS will let you residualize all of the option that you mentioned.

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CarMan@Edmunds

Thanks for the additional information, adi4runner. VW Credit's current base lease money factor and residual value for a 3 year, 15,000 miles per lease of a 2005 Touareg V6 are .00024 and 52%, respectively. Using these numbers, if you were to lease a 2005 Touareg V6 with no additional options with an MSRP of $37,795 and a capitalized cost of $33,888 ($34,388 invoice - $500 loyalty cash) your zero down, pre-tax monthly payment should be around $409.

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CarMan@Edmunds

You're very welcome, hpowders. You;re right, you probably can get a little better deal on the Infiniti M35 than you would be able to get on the 2006 Lexus GS300 right now. If you were to lease a 2006 Infiniti M35 2WD Sedan through Infiniti Financial Services right now for 36 months with 36,000 miles, its base lease money factor and residual value should be .00222 and 64%, respectively.

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hpowders

Hey Car_Man. I hear that BMW allows you to pay multiple security deposits upfront to lower your monthly payment. Do you know by how much each extra security deposit lowers the money factor and how many security deposits BMW allows to be paid upfront?
I was offered a money factor on an X5 4.4 of .00125(base rate) but I would like to get it even lower if I could by using multiple security deposits.
Thank you.
hpowders

hpowders

Thanks, Car_Man. 64% is surely a very generous residual!

zed1

Car_man,

Thanks for the info you provided me. I ended up going with the Pilot, and had a great experience doing the deal, detailed in this post. You provide an excellent, much needed service for the average person who doesn't want to get taken advantage of.

Zed

tomtrav1

car-man,what is your opinion on the lease terms in post # 20676.i hope to lease by the end of this month.

dwynne

I think it is a reduction in money factor of 0.00005 for each additional security deposit you put down. I think BMWFS limits you to just 5 additional deposits now. You will have to run the numbers to see if this is worth it to you are not - looks like 5 extra would drop the rate by 0.6% .

At one time they took off 0.0001 for each extra deposit and allowed for up to 10, IIRC.

If you have the extra money, reducing the rate might be something to think about. For sure it would be "smarter" than taking that money and reducing the cap cost since your money is not at risk should your new truck be stolen or totalled. However paying the money to reduce the cap cost does result in a lower payment.

As an example:

I put in a $50,000 price with a $30,000 (60%) residual for 36 months at 0.00125 and got $655.56 per month.

If you paid 5 security deposits to get the rate down to 0.0010 then the payment drops to $635.56 . So you save $20 per month or $720 over the life of the lease. The deposits would be $650 each so 5 would be $3,250 . So an investment of $3,250 returns $3,970 after 3 years.

If you applied the $3,250 to the cap cost the payment drops to $561.22 per month.

Dennis

hpowders

Thanks Dennis. Very thorough and useful information!

davidd3

Car_Man,

Thanks for your work-up.

Why is the acquisition fee (and everything else it seems) so much higher in NY than everywhere else?

In order to avoid an acquistion fee of nearly a grand (and a disposition fee of a few hundred), does it make sense as an alternative to leasing to seek out a 3-year simple interest balloon loan that has lease-like options when the balloon payment would otherwise be due. It seems to me that such a loan provides the benefits of leasing without the special fees associated with leasing. I have such a loan (psuedo-lease) on my 2004 Honda Odyssey EX-L w/DVD. Monthly payment on this $30,500 MSRP vehicle is only $405 for 36 months, no money down, taxes and fees rolled into the monthly payment. I paid absolutely nothing at drive off. Since it is considered to be a loan, not a lease, the first payment was not due until I had been driving the van for a month. I did, however, have to capitalize the sales tax on the entire sales price, as compared to a lease where you pay less tax. So maybe it is a wash? What I saved in fees I paid in extra tax? I haven't analyzed it.

By the way, why do you view paying the acquisition at drive off differently from making a down payment? Won't you lose that money if your car is stolen or totaled early on in your lease? Why wouldn't you capitalize the acquisition fee and take a pay as you go approach?

Please comment.

Many thanks.

David D

kyfdx

By the way, why do you view paying the acquisition at drive off differently from making a down payment? Won't you lose that money if your car is stolen or totaled early on in your lease? Why wouldn't you capitalize the acquisition fee and take a pay as you go approach?

I think you have the right idea... I see no reason to treat the acquisition fee any differently than any other cost that is included in the lease. My goal in every lease transaction is to pay only the first payment and the security deposit. I always have it added to the capitalized cost.

Some feel differently, but I'm not sure why.. Yes, you pay finance charges on the acquisition fee, but that is no different than any other funds that you would use to pay down, or not pay down on the car.

regards,
kyfdx

leaseshopper

What is your opinion of using a lease consultant? I was just contacted by one who said he deals directly with the manuf. He said his fee is $299 but only payable if I accept the deal he is able to get.

I contacted leasecompare as you recommended but was a little concerned when told their average turn around time was 4-6 weeks. I'm being told by the dealership that the way leasecompare makes their money is by marking up the MF (which didn't do them any favors since THEIR MF was higher than Leasecompare).

I am thinking of going with the 05 BMWi instead after reading your postings about problems.

reechz

I was offered:
Mazda61 with Automatic Transmission:
36 month lease
$246 per month (8 3/4% NY tax built into payment)
residual $9432

only other costs are lisence plates

is that a fair deal?

thanks!

davidd3

Thanks kyfdx. That's the way I've always done it. Of course this method of making no down payment and capitalizing fees (and taxes too in my case) results in the highest possible monthly payment. I suspect that this is the reason why many folks pay fees and taxes up front. But I wonder how many of them realize (before it is too late) that they are taking a risk by doing so. If the car is stolen or totaled early on in the lease, they will have lost their up front payment before they will have had a chance to recoupe it through lower monthly payments over the term of the lease.

David D

candlmeyer

So this is my dilemma. I have a 2002 Honda Odyssey (w/ leather) that reaches the end of it's 39 month lease in July 2005. I only have 24,500 miles on it (we're just close to everything and I have had 2 kids so we don't take very many road trips!). Is it better for me to 1) turn it in and walk away, 2) if it is worth more than the residual value (which I am not sure of, the residual value, that is), make a deal with a trade in value with a dealer, or 3) buy it for the residual value and then sell it on my own? Is anyone aware of the market for used mini-vans? Are they selling easily? I have no problem selling it myself as I have done twice before with other vehicles, but now with kids it would be an inconvenience. My thought is that since it has such low mileage and is in really good condition, that hopefully I can come to a compromise with a dealer to get a good trade in value. Thoughts anyone? We will be buying the next van outright.

tom43

I am getting ready to lease a M35. Just want to make sure the dealer is up front. I will be driving a couple of hours to pick up. The agreed upon price including taxes and a little negative equity is $44,280. I am doing a 39 month lease with 18K miles a year. Credit is excellent although on this car it looks like the money factor is still high. The quoted payment is around $750.00 a month. No drive off fees. This number seems high. Any help would be great.

dwynne

Work with your state politicians to revoke the NY "vicarious liability" lease law and you will find your acquisition fee comes down and more lease banks operate in NY. As is, the lease bank can be sued should you injure someone driving a car they have leased to you.

Dennis

dwynne

I don't know why the lease turn around time would be so long, unless you are asking them to find the car for you. If there is one you want at the local dealer, they would just wire the money to the dealer at your negotiated price and off you go. It should take just a day or two.

I am sure that and the doc is fee is how they make their money - after all the dealer is making thousands off the car AND jacking up the fee. You are right, it did take serious stones from the dealer to say that. If the payment works out for less then let them buy the car from the dealer and lease it to you. They should avoid the dealer's stealing doc fee as well - since all the dealer has to do is send them the MSO (shipping provided by leasecompare) and hand you the keys - that and spend the extra money in their bank :-)

The 06 will likely be a better car once the bugs are out - more power, lighter, larger, etc. The 05 is a proven car and with the cheaper money and $4,200 dealer incentive seems to be a better buy IF you want a car now.

Dennis

dwynne

You can get an idea of the trade value here in the Real-World Trade-In Values forum.

Then check private party sale values here at Edmunds and on KBB and other web places.

In most states you will need to go through a dealer or broker to avoid paying sales tax to buy your van at lease end - then your buyer would have to pay tax again. This would likely remove any profit from the deal. Paying a dealer/broker a modest fee to do this removes the double tax and make it legal.

If the van is worth more in trade than the residual, then you can "sell" it to the dealer you are getting your next car from and pocket the extra or use it to pay the up front fees on the next lease.

With the Ody just undergoing a redesign for 2005 that may cut into the value a bit - but they have always been strong on the used market.

I did a quick check here on Edmunds and a white EX w/leather in my area with 24,500 miles shows $16,834 trade in and $18,134 private party.

Dennis

davidd3

Dennis,

I see. So leasing companies jack up the acquisition fee a few hundred dollars on NY leases taking into account the additional risk factor associated with leasing cars to NY drivers.

I feel once again screwed to live in NY.

David D

candlmeyer

Thanks for the info Dennis. At this point in my life I put a lot of value into convenience. So if I can walk into the Honda dealer, make a little money off my lease and turn around and buy my next (new) Odyssey I'll be a happy woman. Don't know if this is the right forum, but I'll ask anyway. Looks like Odyssey's once again are selling for close to MSRP (as they did in 2002). Should I expect to pay that much...is the demand still that high? Any guidance on what I should pay on a 2005 Odyssey LX (no DVD or navigation) would be helpful. Thanx.

3boy

Dennis, Car-Man, kyfdx -

Thanks for all your prompt and helpful responses! When do you think actual buying price of the 2006 325 will come down appreciably (say, $1000 less than what I could get now)? How long will it be before any bugs reveal themselves? Would I need to wait until the 2007 models come out? I'm willing to wait a few months, but not much more. Thanks again.

CarMan@Edmunds

Hi kulotta. If you want to trade in your current car or truck and lease a new one, your best option is to have the dealer that you are getting your new vehicle from cut you a check for your trade. You do have the option to use the proceeds from your trade as a capitalized cost reduction, aka down payment, on your lease however I always advise consumers against doing so. I do so for two main reasons. The first is if your vehicle is totaled in an accident or stolen during your lease, your insurance company pays off the bank that you were leasing it through and your down payment essentially disappears. The second main reason is that down payments on leased vehicles do nothing to reduce their lease-end purchase prices. So your lease-end purchase option price for your leased vehicle would be exactly the same, regardless of whether you had put several thousand dollars down, or had made absolutely no down payment at all.

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CarMan@Edmunds

No problem, leaseshopper. You never mentioned how many miles per year you are allowed to drive this car. If this lease is a 3 year lease through BMW Financial Services, then it appears to allow 10,000 miles per year. If your mileage allowance is higher than that, this lease is probably through an independent bank instead of BMW FS. The higher residual value for a 15,000 miles per year lease through a different bank would probably make up for the higher money factor. However, if this lease is being run through BMW FS, then both the money factor and acquisition fee are being marked-up to add additional back-end profit to your deal.

As far as this car's selling price goes, I am not surprised that you are not being given much of a discount on it because it is such a new model. $500 to $750 off of MSRP is around what I would expect an '06 BMW 325i to go for right now.

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dwynne

Check in here: Honda Odyssey: Prices Paid & Buying Experience and see what folks are saying - for sure folks in your area.

You should check carsdirect.com as well, I looked and in the ATL area an EX is shown at $1,400 under MSRP - which still nets the dealer $1,400 in profit plus the $861 in hold back.

That is the beauty of the lease - most folks feel like you do about trade ins. They buy a new car every few years and then lose money on the trade each time, because it is just easier. In your case with the lease, if the dealer will not give you a good number then just turn the van in. You might think about a lease on the next one as well - not having something to trade-in sure is nice :-)

Dennis

CarMan@Edmunds

You are correct, reechz. Vehicles' residual values, or their lease-end purchase option prices, do not matter if you don't plan on purchasing your leased vehicle at the end of its term. In fact, the higher a vehicle's residual value is the better. This is because vehicles' depreciation make up a significant portion of their lease payments. The higher your vehicle's residual value is, the less depreciation you have to pay, and the lower your lease payment will be. Vehicles' residual values are set by banks and individual dealers do not have the authority to alter them. So you don't have to worry about the dealer that you are working with "padding" a vehicle's lease-end purchase option. Vehicles' lease money factors are a different story though.

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CarMan@Edmunds

No problem, Cyn. The 48 month residual value that you were quoted to lease this 2005 Honda Odyssey EX is right on the money (50% for a 15,000 miles per year lease). I am surprised that you can put so many miles on a vehicle on such a small island . Honda is not providing any lease support that I am aware of on the Odyssey right now. As a result, if you were to lease one through American Honda FInance Corp. you would have to use its standard lease money factors. The most recent standard 48 month factor that I have seen is .00230. Using these numbers, an MSRP of $28,710, and a selling price of $28,210, I come up with a zero down, pre-tax monthly payment of $387 for 4 years with 15,000 miles per and $376 for 4 years with 12,000 miles per.

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mpklaf

Hi Car_man
What is the MF and RV factor for Acura TL '05 for 4 yrs and 15K miles/yr?
Thanks

CarMan@Edmunds

I'd be happy to check your math, Craig. Infiniti Financial Services' May 39 month, 15,000 miles per year base lease money factor and residual value for a lease of a 2006 M35 2WD Sedan should be .00220 and 62%, respectively. Using these numbers, an MSRP of $47,660 and a negotiated net cap cost of $46,000, I estimate that this car should have a zero down, pre-tax monthly payment of around $589. IFS' lease program for this car is fairly similar across all terms, but the 39 month term provides a nice blend of spreading out the initial depreciaiton hit while not being too long. IFS' base lease acquisition fee is currently $550 in most states.

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tom43

Hi Car Man, when you get a chance can you review message 20703 and give me your feedback. Also the lease residual is 57%. Thanks for your help.

CarMan@Edmunds

I would be happy to try to give you an idea of what this truck's lease program is currently like, ajpbf7. However, in order for me to do so I need to know what state you are in. This is important because Toyota's lease programs often varies depending upon which one of its twelve regions one is in.

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CarMan@Edmunds

Hey buster6. Toyota does have some low money factors on the Tundra right now doesn't it? I am not sure whether Toyota Financial Services includes gap insurance in its leases at no additional charge. Many manufacturers' captive finance companies do, so I would not be surprised if it did. You should be able to find out by contacting Toyota Financial Services using the e-mail link or telephone number that are available on the following page: Toyota Financial Services - Contact Us.

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CarMan@Edmunds

Hi mpklaf. 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.

You never mentioned the selling price or MSRP of the car that you are interested in leasing. These are 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 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 work up a sample lease payment on the car that you are interested in for you if you let me know what these numbers are.

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CarMan@Edmunds

You're very welcome, burgermac. Congratulations on your new truck and thanks for taking the time to stop back and let us all know how everything turned out. Enjoy!

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hpowders

Hello Car_man. I need the residual and money factor for a 2006 BMW 530i for 36 months, 36,000 miles.
Thank you.
hpowders

CarMan@Edmunds

No problem, David D. A money factor of .00255 is actually fairly high for BMW Financial Services. Technically it is slightly supported because it is lower than BMW FS' standard factor of .00270, but not much. Interest rates seem to have creeped up a little amongst manufacturers' captive finance companies over the past several months. A few months ago, BMW FS' standard factor was below .00255. Also, this is a brand new model that really doesn't need much support. I love the new 3-Series and think that BMW will do very well with it. Its' exterior looks like a small 5-Series. I am sure that BMW will eventually have to introduce additional lease support on this car to do the sort of volume that it wants to in the ultra competitive entry luxury segment, but it probably will not be until late this year.

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