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Some of the lease fees can be a bit over the top, I'll agree. What I've learned over the years:
Acquisition Fee - imposed by the bank; cannot be waived. Some manufacturers allow the acquisition fee to be rolled into the cap cost with a slight increase in the money factor.
Disposition Fee - also imposed by the bank, but waived if you buy/lease another car from the same manufacturer
Cap Cost Reduction - also known as a down payment, this is optional, and, not recommended. Many of the national and regional advertised lease specials include some sort of cap cost reduction to get the low payment.
Security Deposits - also optional, this is up front money you give to the bank that will 'buy down' the money factor. BMW, for example, allows up to 7 MSD (multiple security deposits) that will reduce the MF by .00049. For a BMW that stickers at $45K and a net cap cost of $41K, the MSD will reduce your pre-tax payment by a little over $33/mo. This works out to an 11.4% annual return on your investment over 36 months, as the MSD monies are returned to you at the end of the lease.
Wear and Tear Fees - I've leased a number of cars over the years (Fords and a VW) and not once have I had any additional charges due at the end of the lease based on the condition of the vehicle. Now, if you have a tendency to trash your cars, inside and out, then yeah, you're responsible for it. But, for normal wear and tear (small scratches, slightly dirty carpet), you won't be penalized.
Leasing is renting, plain and simple - you only pay for the part of the car you plan to use. There are some incredible lease deals going on right now .. I've seen folks lease $40K Infinities for under $400/mo with minimal out of pocket costs at lease inception.
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2015 Subaru Outback 3.6R / 2024 Kia Sportage Hybrid SX Prestige
Many people lease to get a more expensive car at a payment equivalent to buying a less expensive car and financing.
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2015 Subaru Outback 3.6R / 2024 Kia Sportage Hybrid SX Prestige
Luxury manufacturers often subsidize their sales by inflating residual by five or more percent, instead of giving you cash back to protect the brand perception. In other words, they'll take a hit when taking the car back and sell to the dealers, but on the books and ads the product still has the higher price. Plus, they have an opportunity to hit you with wear and tear, sell the car to you at perhaps less discounted price than dealer wholesale (not many would, though), or get extra fees on certification. In essence, they bring the sale today, but defer the cost and wait for new opportunities.
2018 430i Gran Coupe
2001 Prelude Type SH, 2022 Highlander XLE AWD, 2025 Camry SE AWD
2024 Genesis G90 Super-Charger
Driver, this is a factory order, so I can't go to another dealer to pick another Jeep. However, if this deal doesn't play ball, I will get my deposit back and go to another deal. I don't need it right this minute, so I can wait another 5 weeks.
If we were talking a difference of a few dollars, I would probably let it go. After all, my time is also worth money, but $130x36 is not pocket change.
Hope to have this all sorted out soon and pick it up on Sunday.
To be continued.
(The prior owner obviously didn't lease!)
-auctions
-trade ins
-brokers
-directly from new car franchise stores
Most of ours come from contacts the owners and I made in the car business. People move around, get promoted etc. so over time we have connections with sales managers at our stores. Most franchise dealers will not keep older off make units because they simply don't have space for them, and because of high overhead they won't make enough on such units to cover their required overhead, plus make a decent profit.
The owner here drives to new car stores where they know sales managers to see what they took in on trade. He will pick out the nicest cars that he thinks will do well, and brings them to the lot.
We also have contacts with brokers who go from dealer to dealer, buy specific cars and then call small lots to see who might be interested in them. This saves the selling dealer auction fees of having to send the car(s) to the auction. Sometimes a car will do better in one city neighbourhood than another, especially in a big metropolis with many suburbs with different buyer demographics.
We have an independent mechanic shop close by where we take all of our cars (since we are too small to have a f/t mechanic on duty, and the shop inspects the car, fixes everything that needs attention and gives us an inspection report.
We do the same for the few vehicles we do get from auction, or from brokers, or that come in on trades. If we do get something that's in poor shape, we'll appraise it accordingly and either scrap it (if it's old and too high mileage), or we'll wholesale it out as-is.
Yes there will be dealers that might try to offload junk to the public, but our industry here is well regulated and any misrepresentation of vehicles results in fines and possible license suspensions for the dealer and sales staff.
But it also depends on the car. I've worked at brand name franchise stores where issues came up with "premium used" vehicles, not because it wasn't checked properly, but because of the nature of the vehicle.
I once sold a $35k pre owned Mercedes S550, that was out of factory warranty from a franchise new car store I worked at (not Mercedes store). It has been inspected, and checked, and even the sales manager was driving it for a while with no issues. Customers came and bought it, declined warranty and a few weeks later the transmission started acting up. Minimum cost to fix was $6000 (Mercedes needed to take the transmission apart to find out exactly what the problem was), or it could have been as high as $12000. The car was just covered with the dealer's pre owned basic powertrain warranty (I think 3 days/300kms). I let management deal with the issue and not sure what the end result was - but I think we ended up paying part of all of the repair costs).
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
We used to have to deal with screwy Carfaxes all of the time. Usually odometer related.
Cars that had been in bad accidents had clean Carfaxes and cars that someone had barely tapped in a parking lot would have ACCIDENT REPORTED on the Carfax.
Certainly better than nothing but far from perfect.
On an older car one expensive repair can easily exceed the value of the car.
That said, if it's anything more than a minor sheet metal crease, to ONE panel, you're looking at thousands in repairs. In that case, I would not get involved. I would just let the repair shop deal directly with the insurance company given I would not want to tie up a lot of my own money and not have the insurance company's warranty for the repairs.
This has been awhile ago, but I actually was trading in a vehicle that had some minor paint work done on the back quarter panel. The used car manager used a paint gauge to ascertain that there was indeed some work done to the car. As I'm likely to do, I was steadfast on my number. He gave me pushback because of the paint work. What he was perplexed about was the work didn't show up on the CARFAX. I told him that was because I paid for the repair out of my own pocket.
We ended up not doing a deal since he insisted my trade was worth thousands less given his paint gauge test. I bought the identical car from one of his competitors the same day AFTER I explained the paint work that was done. With that dealer, the used car manager said he didn't care as long as it didn't show up on CARFAX.
Also, it sounds like the dealer is kind of blackmailing you. This is the car you special ordered, now we can get whatever we want for it. I could be totally wrong, but what did I miss?
2017 MB E400 , 2015 MB GLK350, 2014 MB C250
I've got a deposit on a particular Subaru Outback that will be delivered to the dealer in the next few weeks. I know what the sticker price will be, but we haven't spoken of any selling prices yet - I'll deal with that once the car hits the lot.
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2015 Subaru Outback 3.6R / 2024 Kia Sportage Hybrid SX Prestige
Now, I think I get it. But, the dealer could blackmail you a bit. If you don't like their deal you have to start all over at another dealer...and wait another 5 weeks. Why not work out a price beforehand based on the price, and then you either take the car at the prearranged price, or get your deposit back? Seems to be too much left up in the air that could go wrong.
2017 MB E400 , 2015 MB GLK350, 2014 MB C250
If we don't come to a deal, we get our deposit back and the wife continues to drive the Mazda. It's not that she doesn't like her current car, she just likes the Subaru more.
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2015 Subaru Outback 3.6R / 2024 Kia Sportage Hybrid SX Prestige
Maybe I am wrong........but, it seems you a lot of trust in the hands of the dealer.
2017 MB E400 , 2015 MB GLK350, 2014 MB C250
Meanwhile, as long as the lease gurus are at it take a shot at a 3 year lease (15K a year). We'd likely buy at the end of the lease. Right now I've got a price of $24.000 with the roof but not the starter.
Remote start is $499. http://www.toyota.com/efc/#!/build/step/accessory/year/2015/series/prius/model/1225/exteriorcolor/08S6/interiorcolor/FB40/packages/option2/accessories/
If they are the only options MSRP is $28,589.
Here's where I started: http://www.toyota.com/efc/#!/build/step/model/year/2015/series/prius/model/1223
2025 Forester Limited, 2024 Subaru Legacy Sport
They didn't get the memo (hasn't sold yet either and it's been FSBO on the corner for 2 weeks now).
That said, Consumers Still Want Higher-Mileage Vehicles Despite Low Gas Prices, Study Says.
My Kia salesguy tried to call me today while my wife had the phone. She answered after the 2nd ring but the salesperson had hung up (no idea how many rings the salesperson heard - I guess the number you hear may be different from what the caller hears). No message left either.
Toyota leases are notoriously difficult to figure out. First, the numbers are highly regional. Second, they don't residualize the entire MSRP like most manufacturers do. The dealers have to look at each stock number and figure out the residual based on the options on any particular car.
That said, we do have some "base MSRP maximum lease residual percentages". 59% for Prius 3 for 36/15, with a .00001 MF (that would be .024% APR, for those of you scoring at home). If you can get the MSRP as well as the net cap cost, we can model the payment for you.
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2015 Subaru Outback 3.6R / 2024 Kia Sportage Hybrid SX Prestige
A customer special orders a car that they "might" buy?
No store should be dumb enough to do this unless the car is a hot item that they have no fear will quickly sell to someone else.
The deal should have been struck in writing with all numbers agreed to before this happened.
Makes zero sense!
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2015 Subaru Outback 3.6R / 2024 Kia Sportage Hybrid SX Prestige
I still can't see why they wouldn't have worked the deal and run you through finance to seal the deal but I guess they run a loose ship.
-subject to viewing vehicle
-subject to trade
-subject to wife
-subject to financing
-etc.....
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
We've seen the color that's coming in - wife likes it
Trade still to be evaluated
Wife has test driven and approves
700+ FICO for both of us
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2015 Subaru Outback 3.6R / 2024 Kia Sportage Hybrid SX Prestige
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
2020 Acura RDX tech SH-AWD, 2023 Maverick hybrid Lariat luxury package.
so assuming the dealer honors their word, Michael gets a call when it arrives, and has a couple of days to get over there, look at it, and work out a deal. If they can't, it goes back to available. No risk to the dealer. They were getting that unit in regardless.
2020 Acura RDX tech SH-AWD, 2023 Maverick hybrid Lariat luxury package.
Please clarify a bit more;
Did you put a deposit on the vehicle?
Will you be offered first chance to buy it?
What happens if you like the car, but they are charging too much?
How long did you wait before the car came in?
What happens if someone else walks in and buys the car - can they get out of the deal?
Could there be a bidding war for the car?
Do you know what you should pay for the car and what you expect to get for your trade in?
Not sure I understand the concept??????
2017 MB E400 , 2015 MB GLK350, 2014 MB C250
all he really did was put down the deposit to keep them from selling it before he has a chance to see it in person (right of first refusal). No risk at all for the dealer. They probably like having a guaranteed shopper coming in a few weeks from now when it arrives!
2020 Acura RDX tech SH-AWD, 2023 Maverick hybrid Lariat luxury package.
Big news is, Amazon has made a Harry Bosch TV series.
Do a search and you can watch the first episode.
I know keyless start is all the rage now but I don't understand why.
ISell, not the fob. They one where you just need to be near the car. I doubt my wife has seen her keyfob in 2 years, it is buried so deep in her overstuffed purse.
2020 Acura RDX tech SH-AWD, 2023 Maverick hybrid Lariat luxury package.
Another one of those "extras" that I couldn't care less about just like auto headlights.
I may be getting old but I can still turn on my own headlights!