Lease Questions - Ask Here

toyotasalesg1

Thank you Car_man. .00235 is actually much better than I thought.

mikeko

Car_man,

Thanks for the prompt response and advice. After going back and raising the MB cash incentive for more leverage in connection with negotiating the cap cost, the dealer has quoted a lease with a pre-tax monthly payment of $715 and no money down for 39/mo and 15K/yr mileage. While the dealer tried to add in some more profit by padding the finance charge number in connection with the total drive-off cost (e.g., he provided a figure of $1,000), I "reminded" him that the MB finance charge should be $795. Thus, it looks like we're getting in the right ballpark now.

techbiz

Hi Carman,

Would love to find out about 530xi, MSRP say around $51,500. On BMW's website it says the lease would be around $684/month for 36 months/12K miles (the terms I am looking for).

Based on your calculation/MF/etc - say it's a lot lower (e.g. $550) as an example, how do I get them to agree w/ your #'s rather than whatever they used? (please ignore if this is answered in the lease forum, which I am heading over right this).

Thanks in advance!

CN

thr61

I am about to begin negotiations on my first BMW and would be interested in some views as to a good outcome.

I am planning on leasing a 2006 325i set up as follows:

- metallic paint
- premium package
- cold weather package
- satellite radio

I am planning on a 36 month lease and 18,000 miles per year. I would likely put down $2500.

I am interested in what I might reasonably achieve in terms of final price, money factor, and ultimately, monthly payment.

Thanks.

usmj1

Car_man,

Offered lease on 2005 Saab 9-5 Arc with Luxury package. X-Loaner with 4K miles:
MSRP: 39,390
Selling price 28,000
36 months with 15k/year
2000 at lease inception and 433/ monthly payment.
Good deal??

Thanks for your help.

jarjoura

Car_Man,

Thank you! I am glad I have your blessings that this is an "attractive deal." I have been reading your posts for the past 4 months and followed market trends and MFs as well. I believe now is a great time to buy certain Mercedes models. The residual was 75% for 27 months, and the money factor was the special subsidized rate. The residual will change when I up the mileage to 12K per year. I will compare the differential to the 20 cent (first 5K), 25 cent thereafter charge upon return. Hopefully the difference between the residuals divided by the mileage differential will be less than if i were to spend 20 cents for the first 5K and 25 cents after.

Had it not been for the forum here, and all the advice you have given over the years [yes, I went through the archives ], I would not have been able to pull off such a steal.

Again, thanks for all your help!

-Tony
:shades:

crandleman

Car_Man & Everyone,

When do the September specials kick in for Honda & Toyota? Anyone know what they are yet?

Thanks in advance

atfryar

I searched this board and found money factors and residuals on a 2006 2.5T AWD XC90 and I was hoping to get the same numbers for a 2005... assuming 12K miles/year and 36 months. Also, are there any dealer incentives, rebates or whatever on leftover 2005's? I didn't see anything in the Edmunds rebates section however in the "Price's Paid" forum people are randomly mentioning discounts on the 05's. Any help would be appreciated. There don't seem to be a ton of 05's left here in New England though... we'll see. Thanks for your help, this forum is great!

ladera42

Looking to lease a new honda accord, just wondering what some of the best leases are available these days w/ zero down. thanks.

timmboj

Now that you mention it... :-)

I have most of the information I need to lease a 2005 BMW X3 3.0 (Current BMW incentive, 39 months / 10K miles per year, 63% residuals, .001 MF).

But I don't know anything about the smaller 2.5 engine. They're discontinuing that engine for model year 2006. So the residuals probably won't be as high as the current 3.0 lease incentives.

Do you have any number for this particular model? I'd want 24 months or 36 months on the 2.5 if I went ahead with it and if BMW isn't running 39 month specials on the 2.5.

Thanks Car_Man

nberkel

Hello!

I have gotten some wonderful information from this forum and this website - thank you! I'm all over the calculation to get to a lease payment now. My question or rather weak side - is how do you relay that to a dealer? I got my first quote today for a 24 month lease on the Altima 2.5s with conv package, I would be willing to put $1k toward first months payment and security deposit or whatever - and this dealer quoted me at $317+ tax. The MSRP is around $22,350 (do i need to negotiate this if they apply the incentive?) and I found for 15k mi/year to be at a 66% residual and .00175 MF. I read about the $1500 - is that something you specifically have to say - hey can you please apply that $1500 incentive? So given those figures - seems like the payment should be more like $247 or so? Do I bring my pencil and sit down and say this is what I come up with?! I think my trouble is getting them to show me how they came up with the numbers, especially with the sales guy running back and forth to the finance guy.

Thank you for any feedback!

Nikki :sick:

meeshel

I'm interested in leasing a CPO Lexus SC430. I've never leased a car before, only financed, so I was wondering the Pro's & Con's. My trade-in ES 300 will probavly be a wash.
It's my understanding that you can get a more expensive car with a lease, with lower payments. They are asking for 04 SC430 - $45K, 24,000 miles. Based on the Lexus leasing calculator, monthly payment is $864. ...seem high to me.

Meeshel

crandleman

Car_Man,

I have talked to a few dealers today and they are all telling me that the current lease deals on the 2005 Civics and 2005 Camry's are only going to get worse after the new deals come out in September. The also told me that there will be no good lease deals on the 2006 Camry's until months down the road. In your opinion, is this true?? I can't tell if it is just dealer talk or is legit, someone please help me out here!!

Thanks in advance.

drhippo

Hi--i've leased for years, but still have trouble figuring out the equivalent of the interest rate.

Just leased an infiniti m35x...3k down and 542/month x 39 (12,000 miles year).

On my contract, the depreciation/amortized amount is ca. 18794 and total "rent" charge (ie. interest, right?) is 6241.

When I run these through a interest caluculator, I get about 7.1% annual interest rate--is that correct? Seems a bit high to me!? Where does the "money rate" figure into all this?

Thanks!

kyfdx

You aren't borrowing the depreciation... You are borrowing an average of the capitalized cost and the residual...

Example:
Car costs $40K at start of lease, residual at end of lease is $24K... average amount borrowed is $32K.. This is the average outstanding balance owed on the car over the life of the lease... Use this figure (using your own numbers), and you'll see that your finance charges are much lower...

regards,
kyfdx

petesamprs

As a followup, some people get confused how the total rent charge is calculated from the money factor.

Total rent charge = money factor * (cap cost + residual value) * term (months)

This formula simply applies your interest rate to the average value of your car during your lease. The reason you ADD cap cost + residual is because you are averaging the two, but you don't see the division by 2 because it is included in the money factor calculation.

In other words, you can arrive at the same total rent charge number by the following calculation:

[(% Interest rate / 100) / 12] * [(Cap cost + Residual) / 2)] * Term
ie: Monthly interest rate * Average value of car during lease * # of months

People use "money factor" to simplify the above equation by combining the constants:
[[(% Interest rate / 100) / 12] / 2] * (Cap cost + residual) * Term
_or_
(% Interest rate / 2400) * (Cap cost + residual) * Term
_or_
Money factor * (Cap cost + residual) * Term

I'm no expert so please correct me if I'm wrong here.

thr61

am about to begin negotiations on my first BMW and would be interested in some views as to a good outcome.

I am planning on leasing a 2006 325i set up as follows:

- metallic paint
- premium package
- cold weather package
- satellite radio

Likely price will end up around $34,500 (my best guess as of now)

I am planning on a 36 month lease and 18,000 miles per year. Based on further reading of this forum, I am going to put as little down as possible, but will pay registration, fees etc.

I am interested in what I might reasonably achieve in terms of final price, money factor, and ultimately, monthly payment.

Thanks.

drhippo

Hi--i've leased for years, but still have trouble figuring out the equivalent of the interest rate.

Just leased an infiniti m35x...3k down and 642/month x 39 (12,000 miles year).

On my contract, the depreciation/amortized amount is ca. 18794 and total "rent" charge (ie. interest, right?) is 6241.

When I run these through a interest caluculator, I get about 7.1% annual interest rate--is that correct? Seems a bit high to me!? Where does the "money rate" figure into all this?

Thanks!

beemerluv

car man & kirstie h, and anyone else with knowledge about this: how do leasing companies calculate the money factor into your payment? I have been converting it to %, then calculating it into the projected payment, is this the correct way? I am currently trying to close a deal on an 06' 530 and everything looks good except for this part: BMWFS is giving me a payment of $456.39 (includes tax) but when they add the .00175 mf, the payment goes up to $598.40 ($142.01 in interest) but when I calculate it myself, the payment only goes up to $475.55 ($19.16 in interest), who is correct? :confuse:

Thanks in advance folks.

CarMan@Edmunds

Thanks for the additional information steveholly. The selling price that you were quoted for this car seems reasonable to me, but you may want to stop by the following discussion to compare it to the prices that other community members have paid for similar vehicles lately: "Volkswagen Passat: Prices Paid & Buying Experience". Let's calculate a lease payment on this car that you can compare to the one that you were quoted. According to my calculations, if you were to lease a 2006 Volkswagen Passat 2.0T with an MSRP of $28,415 and a selling price of $26,651 through VW Credit right now for 36 months with 15,000 miles per year, your zero down, pre-tax monthly payment should be around $319. If you need to drive more than 15,000 miles per year, you will have to purchase additional miles on a per-mile basis. It is usually less expensive to do so at lease signing than it is to wait until lease-end and have to pay an excess mileage penalty.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

Congratulations on your new car, J. Roosa. Thanks for taking the time to stop by and let us all know how everything turned out. Enjoy .

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

Actually I prefer Doritos or Cheetos to Fritos :shades: .

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

You're very welcome toyotasalesg1.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

You're welcome mikeko. It sounds as though you are making good use of the information that you have gotten here. Good luck.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

Hi techbiz. I don't believe that BMW is currently advertising a lease on the 2006 530xi. As a result, I suspect that you used some sort of lease calculator to come up with the payment that you mentioned. Unfortunately, on-line lease calculators are usually not all that accurate. Sometimes they fail to take into account manufacturers' actual lease programs and sometimes they base the payments that they calculate on a selling price of full MSRP. I would be more than happy to calculate a sample lease payment on the car that you are interested in for you if you provide me with an approximate selling price for it.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

I would be happy to give you an idea of what this car's current lease program is like, thr61. If you were to lease a 2006 BMW 325i through BMW Financial Services right now for 36 months with 15,000 miles per year, its buy rate lease money factor and residual value should be .00250 and 61%, respectively. 15,000 miles per year is the highest mileage allowance that BMW FS publishes residual values for. If you need to drive more than this, you will have to purchase additional miles on a per-mile basis. It is less expensive to do so at lease signing than it would be to wait until lease-end and have to pay an excess mileage penalty. In order for me to calculate an approximate lease payment on this car for you, I need you to provide me with its full MSRP (with the destination charge added in) and an approximate selling price.

In your post you mentioned that you would like to make a $2,500 down payment on this lease. I always advise consumers against making any sort of down payment when leasing. 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 325i would be exactly the same, regardless of whether you had put $2,500 down, or had made absolutely no down payment at all.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

Hi usmj1. The problem that I personally have with demo vehicles is that dealers never seem to be willing to provide enough of a discount on them for me to personally justify purchasing one over an equivalent brand new model. Before you lease this car, you should check to see what sort of price you could get a new 9-5 Arc for through GM's Employee Purchase Program. Let's calculate a sample lease payment on the demo that you are considering using Saab's actual lease program and see what we come up with. According to my calculations, if you were to lease a 2005 Saab 9-5 Arc Sedan with an MSRP of $39,390 and a selling price of $28,000 through Saab Financial Services Corp. right now for 36 months with 15,000 miles per year, your zero down, pre-tax monthly payment should be around $341. As you can see, something definitely is not right about the lease payment that you were quoted for this car.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

You're welcome Tony. I'm glad to see that you are such an avid reader of this discussion. Now definitely is a good time to lease a 2006 Mercedes-Benz E-Class. Enjoy your new car.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

Hello crandleman. Honda and Toyota's August lease programs are scheduled to run through September 6th. It is difficult to say what their new September lease programs will be like at this point. Please feel free to check in with me a few days after the new programs are scheduled to be released and I will be happy to try to give you an idea of what they are like.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

Hi atfryar. I'm glad that you enjoy this discussion so much. Unfortunately, Volvo is no longer providing lease support on 2005 models. It replaced its special lease program for '05's with dealer cash. Specifically, it is providing $2,575 (an odd amount don't you think) dealer cash on 2005 XC90s. You can take advantage of this cash and lease the XC90 that you want using Volvo Finance's standard lease program, but at this point you probably would be able to get a better deal by leasing one through an independent bank.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

Greetings ladera42. I would be happy to give you an idea of what it would cost to lease the Accord that you are interested in. However, you never mentioned its selling price or MSRP. 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 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.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

Hey timmboj. The BMW X3 is very different than the Saturn VUE. If you were to lease a 2005 BMW X3 2.5i through BMW Financial Services right now for 39 months with 10,000 miles per year, its buy rate lease money factor and residual value should be .00125 and 62%, respectively. The numbers for a 36 month lease would be the same and the numbers for an otherwise identical 24 month lease should be .00125 and 69%. Your best bet for this model right now is the 39 month term.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

I'm glad that you fins this site so helpful, Nikki. When negotiating a lease, it is very important to remember that the selling prices of leased vehicles are always negotiable, much like if you were paying cash for or financing the vehicle that you want. Negotiate the lowest selling price that you can for the 2005 Altima that you are interested in, making sure that the $1,500 cash incentive that Nissan is currently providing on leases of it into account, and then have the dealer calculate your lease payment. You can always calculate several lease payments on this car in advance, based upon the selling prices that other community members have reported getting over in the following discussion: "Nissan Altima: Prices Paid & Buying Experience". This will give you a ballpark lease payment to shoot for.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

Welcome meeshel. 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.

The problem with leasing used vehicles is that manufacturers often do not provide the same level of lease support on used vehicle leases as they do on new vehicle leases. As a result, there is often not much of a difference between the lease payments for a used vehicle and an equivalent new vehicle. You may want to get a price quote for a lease of a similar brand new SC 430 prior to committing to leasing a used one.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

Hi crandleman. It is difficult to say what the new lease programs will be like on the Honda Accord and Toyota Camry in September. Dealers don't even know what the September programs are like yet. If I had to make an educated guess, I would say that Honda and Toyota will at least try to maintain the same lease payments that they are currently advertising on these cars. Again though at this point nobody knows for certain what will happen. Remember that it is in the best interest of the dealers that you are working with to create a false sense of urgency to get you to finalize your deal ASAP. Not only do they get to add another sale to their August total, but they prevent you from leasing another vehicle or from a competitor and losing your business entirely.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

Hi drhippo. Infiniti Financial Services' current base lease money factor for a 39 month lease of a 2006 Infiniti M35x is .00202. This is equivalent to an interest rate of just under 4.9%. It is difficult for me to tell if this is the money factor that was used to calculate your vehicle's monthly payment, but you can see what your car's payment would be like using this factor, a residual value of 60%, and the prices that you paid by plugging this information into the following formula: Calculate Your Own Lease Payment.

Car_man
Host
Smart Shopper Forum

CarMan@Edmunds

Hi beemerluv. You can plug a vehicle's lease money factor, along with its residual value, MSRP, and selling price into the following formula to arrive at its monthly payment: Calculate Your Own Lease Payment.

Car_man
Host
Smart Shopper Forum

108flat

Trying to find residuals and depreciation pct for MSRP $27645 4WD, V8, access cab. Just got off the phone with Toyotafinancial who says they don't do residuals- that is up to the dealer.

techbiz

Hi Car_man -- sorry I meant 2005 530xi -- let me know if you have any clue. I am guessing the price will be around $50-51K for the config I am looking for. thanks again.

atfryar

I drove, and loved, a 2006 XC90 2.5t last night. I had zero intention of making a deal unless I could get what I wanted for my trade. Which I couldn't... but they worked some numbers for me anyways and at first came up with the following deal, assuming I was 3,000 upside-down on my trade: 36 months, 12K miles @ $445/month with 8,300 down!!! I almost fell out of my chair. 8,300 down? wow. When I started laughing and said that I wasn't going to put anything down, never mind 8,300, we went back and forth for awhile and eventually came up with 36 months, 12K miles @ 475/moth with 0 down (taking my upside down trade out of the equation). Makes you wonder how the payment went up only 30/month after removing 8,300 in cash. The more I think about it, I'm actually sort of offended that they tried to get away with that. whatever.

Anyways, I never asked, but should have, what the cap cost was in that last deal (the 475/month deal). Car_Man, Can you back into that number for me? Here are the numbers on the 2006 XC90:

MSRP 41,780 - 36 months - 0 down - 12K miles/year = 475/month, cap cost = ????

I'd like to know this when/if I go back. I'm attempting to sell my car on my own.
Thanks yet again!!!

beemerluv

yes, I have used this calculator several times, and as I said before, all of my numbers jibe with theirs except for this particular area, my only question is: do they convert .00175 to 4.2% before calculating it into the payment, because if they do, then $456.39 x 4.2% = ($19.16) = $475.55, they are giving me $456.39 x 4.2% = ($142.01) = $598.40... from what I can see, they are OVERcharging me by $122.85, or am I in error?

gr8396

my son is looking to lease his 1st vehicle. hes on a tight budget trying to save up for a house in the next couple of years. he wants to lease because he doesnt want any 'surprise expenses'. in your opinion what is the best lease out there right now. he'd like to keep his payments under 200/ month , 36-39 month term with minimal upfront deposit ( maybe 1000 or 2000). hes been researching the honda civic lease deals as well as what u.s manufacturers have to offer. you have any opinions on this?

kyfdx

Don't convert the money factor to a percent... the money factor is designed to give you the monthly finance charge, just the way it is....

Money factor X (residual + cap cost) = monthly finance charge..

In short... you are in error..

regards,
kyfdx

crandleman

Just from working on Honda Civic leases for the last 3 weeks I can tell you unless he has tier 1 credit and gets the price of the car down to invoice or below, he will not be getting a lease payment for under $200 on the Civic right now. His only option to getting it under $200 per month is putting money down which is a no-no. Unless I am missing something, the best I have been offered on a Civic VP w/ Side Airbags was $208 after tax title lic acq etc...

beemerluv

money factor X residual + cap. cost = monthly finance charge...
that was the formula I was looking for, THAT answers my question.

Thanx

bdr127

I understand why you don't want to put any money down for a lease..... Does this include things like 1st month payment and security deposit? I feel like it wouldn't be the same, since the 1st month payment is a payment toward your car and you get the security deposit back at the end (provided the car is in good shape). Please advise, car_man! Thanks!

kyfdx

You have a good handle on it... 1st payment and security deposit aren't the same as money down...

regards,
kyfdx

baserunner

Good morning ! Car Man .... Thanks for your advise. Below is the quote from a Nissan dealership in Houston, Texas. Please review the numbers and let me know if it is a fair deal and what's the monthly payment going to be?

Also I am awaiting for two more quotes from two other dealers in town.

2005 350Z Roadster Touring in Black exterior and automatic.
1. MSRP - $39,850
2. Invoice Price - $36,813
3. Cash Rebates - 0
4. Dealer Cash...
5. Selling Price - $36,413
6. 36 Months
7. Mileage - 15,000/year
8. Overage Charge - 15 cents/mile
9. No Down payment
10. Cost to Sign - only first months payment ($686.89) - Security Deposit waived
11. Rate Lease Money Factor - .00295
12. Residual Value - 53%

Again, thanks for your help.

Frederick

velvel

Hi- after i negotiated a price out the door for purchase based on a 22,618 invoice plus 700.00 and tags tax = 24,900 for EX sedan V-6 Accord, I tried to get a lease and they have offered sign and drive 330.00 /month plus tax-,just first month plus registration and tag,for 3 yr/12 K lease-GAP included, no dispo fee at termination... does this sound reasonable?? Please advise if can ASAP as Im supposed to meet my wife at dealer to sign-and drive tonite!
Oh- I should also say the MSRP including destination is:27,365...Thanks for your help..

nberkel

Thank you!