Honda Pilot Lease Questions

smith1

The Leadership Purchase Plan sounds interesting. However I don't see anywhere stated that if you decide to buy the car at the end of the lease Honda will finance you at the same interest rate paid during the lease. In fact, the only documentation I could find about the LPP purchase option on the Web, at http://www.hondafinancialservices.com/looking_ahead/lpp.asp

doesn't say anything about Honda financing the purchase at all, let alone at the same rate that applied during the lease. Can someone point me to where this is spelled out?

golic

Smith-

We had two Honda people confirm this when this issue came up in the archives. Apparently in the contract you can extend the financing up to X months at the original interest rate.

Something else, to consider on the lease buy-out. Depending on your state, even if FMV = Residual. It may work to your advantage to buy car and trade it in and take advantage of a sales tax credit.

piloti_sti

Ok, I finally got specifics from one dealer:
EX 2WD
Purchase price: $28180.
MF: .00022 (X 2400=.528)
Residual= 53%
$0 down, 36/15k miles, $407/month tax included.

Purchase price seems high to me. She refered me to the hondafinancial site for details on the Leadership plan.

Anyone have input?

smith1

The current advertised deal for a 3 year lease on an LX FWD is $279 per month (not including tax) for 12K miles/year, and requires an $825 cap cost reduction. I need 15k miles/year, and would prefer not to put up the $825. How much room is there to do better than the advertised deal? Is $279/month for 15k miles/year, with no cap cost reduction, a realistic negotiation target? I have top-tier credit. Thanks.

roscoe301

I just wanted to say thanks to Car Man, Golic and the other posters here. I got an EX-L yesterday, and while I probably didn't shake them down for every penny, the knowledge I learned here was invaluable. It made the experience easy, I felt in control of the situation and I got a very good deal. Once they saw that I knew what was what, they pretty much gave me what I asked for.

Thanks very much, guys.

Roscoe

abang

Carman

I have never leased a car and was wondering if this is a good price on a Honda Pilot LX. Honda's lease special is ending April 3rd so would appreciate an answer. This is the breakdown of the lease

Capitalized cost :$26021
Residual: $16097.20
Mileage: 15K per year
Length: 3 years
MF: 0.00068

Monthly payment: $321
I only have to put down $539 which includes the first month's payment and DMV fees.

Is this a good deal?

Thanks

smith1

To evaluate your deal I believe carman will need to know whether the vehicle is FWD or AWD, and whether the monthly payment includes any sales tax (if so how much).

abang

The Pilot LX 4WD is what I'm looking for. There is no sales tax where I live (Oregon).

Thank you.

jethro23

abang,

I calculated the following payment based on the figures you provided:

2006 Honda Pilot LX AWD
Invoice (including Destination): 25,922
MSRP (including Destination): 28,745
Negotiated Price: 26,021
Residual: 16,097.20 (56%)
MF: 0.00068

Depreciation Fee = (negotiated price - residual value)/term
= (26,021 - 16,097.20)/36
= 275.66

Finance Fee = (negotiated price + residual value) * MF
= (26,021 + 16,097.20) * 0.00068
= 28.64

Payment = Depreciation Fee + Finance Fee
= 275.66 + 28.64
= 304.30

Hmmmm....that's a noticable difference from $321/mo you were quoted. Did you get additional options, warranties, etc.?

I'm no expert, but I've tested the lease payment formula I used above with the numbers detailed in Honda's special lease offers (see their website), and it calculates accurately.

webbcrawler

Could the $321 that abang was quoted include sales tax? It looks to be (based on your numbers and abangs' numbers) about 5%-6% difference, and that usually the sales tax.

abang

Thank you very much for the breakdown of the calculation, Jethro. I used your calculations to follow up on a couple of quotes that I got from other dealers and none match up, so I guess I'm being taken for a ride somewhere (without the Pilot LOL). There is no sales tax where I live.

smith1

You could challenge the dealer to explain why the monthly payment shouldn't be $304 based on the cap cost, money factor and depreciation figures they quoted you (which are all good by the way).

preetypilot

hello everyone,
Thanks for having such an informative forum.
I am looking to lease a 06 Pilot in Orlando,FL 32832.
I have excellent credit 700+ fico.
Here are my needs!
- I would like 0 down
- privacy glass and roof rack-
- I need 15k/yr miles min
- most likely will buy at the end of the lease.
- I 'd go for leather if it adds less than $20 to my payments. don't care for 4x4 and navigator.
i 'd like to keep payments <$300.
- I m starting a new retail business, would it bebetter to buy in business name - will it screw me on insurance? any tips would be greatly appreciated.
Can someone please help me with fair price and if any dealer in orland i should deal with.
Also where can i find the explanation of lease must know vocabloury.
Thanks a lot for your reply, i really appreciate it.

kyfdx

Don't forget the $595 acquisition fee... Add that to the cap cost, and you should be right around your number..

portpilot

Hi everyone,

I have found this forum very helpful. I am looking to lease a Pilot EX-L RES for my wife. I have been offered the following terms:

Agreed selling price: $30,868
Cap Cost: $32,103 (in. $550 destination & $595 Assignment fee)
Term: 36 months; 12K/year
Residual: 55% ($19,357)
Money factor: 0.000680
Lease payment: $389.07

Upfront: Taxes + 1st month

What is the "Assignment Fee"? The dealer tells me it is to Honda finance - is this true or another way for them to make money? How do the above terms look?

Thanks!

joeyhalsted

Pilot 4WD EX-L w/Navi - I WILL BUY BEFORE MARCH 31,2006

TERM:36 months
MILEAGE: 15k year

Agreed selling price 31,700 (includes destination)
Residual: 51%
MF: .00068
ILLINOIS TAX .0625%
NO SECURITY DEPOSIT
NO ACQUISTION FEE OR ASSIGNMENT FEE

LEASE PAYMENT OF: 485.00

QUESTIONS:

1.) IS THIS A GOOD DEAL?

2.) WHAT IS THE BEST RESIDUAL I CAN NEGOTIATE?

3.) I BELIEVE THE MF COULD BE .00058 IF I PAY A SECURITY DEPOSIT? DO YOU RECOMMEND PAYING TO GET THE LOW MF?

4.) WILL THE "LEADERSHIP PURCHASE PLAN" HELP ME WITH MY TAX BURDEN? IN ILLINOIS I HAVE TO PAY TAX ON THE SELLING PRICE AND IT IS INCLUDED IN THE LEASE PAYMENT. IT ADDS CLOSE TO $100 A MONTH TO THE PAYMENT.

THANKS IN ADVANCE.

georgec1

HELP!! I am in quick need of knowing the current MF and residuals for 2WD and 4WD EX Pilots. Also, does anyone know what the MF and Residuals would be for EX-L? I need to do a lease deal today if possible and would like to get this done before month end. Thanks for your help.

georgec1

Joey: I am also trying to complete a deal before month end. I am talking to Grand Honda, who I think have pretty good terms. I think you can definitely purchase at invoice. I think your MF is correct, but I am trying to confirm this myself. The residual does not sound right. I think it should be 56%, but looking for confirmation. Let me know how you do.

joeyhalsted

This is what I found - I agree that the residual looks low - can anyone PLEASE confirm the residuals for 36 months 12k and 15k - is the table below correct?

2006 Honda Pilot 4WD 4dr Wagon EX-L w/ Navigation

24 mo/15k mi &#150; Residual Value 60% of MSRP &#150; .00058 Base Money Factor Rate
36 mo/15k mi &#150; Residual Value 51% of MSRP &#150; .00058 Base Money Factor Rate
48 mo/15k mi &#150; Residual Value 43% of MSRP &#150; .00255 Base Money Factor Rate
60 mo/15k mi &#150; Residual Value 35% of MSRP &#150; .00445 Base Money Factor Rate

24 mo/12k mi &#150; Residual Value 61% of MSRP &#150; .00058 Base Money Factor Rate
36 mo/12k mi &#150; Residual Value 53% of MSRP &#150; .00058 Base Money Factor Rate
48 mo/12k mi &#150; Residual Value 45% of MSRP &#150; .00255 Base Money Factor Rate

smith1

The Leadership Purchase Plan still requires paying sales tax on the negotiated vehicle price, no difference there.

The sales tax treatment of car leases in Illinois is terrible. Ilinois is one of the few states where sales tax must be paid up front on the ENTIRE net cap cost of a leased vehicle, not just the portion used during the lease. Even worse, if you buy the car at the end of the lease you pay sales tax AGAIN, on the used car purchase price. Talk about double taxation....

I've wondered if a vehicle financed in Illinois via the Leadership Purchase Plan would require paying sales tax a second time if you purchase the vehicle at the end. I'm thinking not, because (if I understand correctly) the LPP is essentially a balloon loan and I believe your name is on the vehicle title from the beginning, unlike a regular lease where only the leasing company's name is on the title during the lease period and therefore the purchase of the car at the end of the lease is a "change of ownership" triggering the sales tax again. But I'd like to confirm this. This could be a good reason for an Illinois resident to go with the LPP vs. a lease if there is a significant possibility you may want to buy the car in the end.

joeyhalsted

Car_Man,

Could you please confirm the best residual I can expect on the 4wd EX-L w/Navi? 12k and 15k - I along with some others on the board seem to think it should be higher than the 53 and 51% quotes I am getting from the dealer.

Thanks again,

piloti_sti

I guess, I like a lot of others here are trying to get their leases done by the end of month. Got an offer, here is the details.. 36 months/ 12k miles

MSRP: 30095.
Neg. Price: 26600.
MF: .00022
$0 down payment

Here is the thing, the payment quoted is $384(tax included) but the lease calculator I am using says $323.78. Something is wrong. Trying to figure out why the discrepency.

Any ideas?

piloti_sti

Today, a dealer e-mailed me back that they have no way to guarantee an interest rate 3 years from now. They had no knowledge of being able to finance it like that. Maybe it is diffrent by state, I am in FL.

golic

What is your sales tax rate and are you adding in the $595 Acc fee?

Let me know and i will calculate.

piloti_sti

Sales tax is 7% and, I added a $500 acc fee when I calculated my payment but it is not included in the price of $26600, so I was short $95. Can you make sense of it?Does the rest of the deal look good?

Thanks!!

dddbbrown

Hi there. I'm glad to have found this forum. I've been out car shopping all week and will be picking up a Pilot to have for the day. I'm a business owner and, for the first time, considering leasing a vehicle, instead of purchasing. Any helpful info you can offer about leasing would be great to help me make the best decision. Here's what I've been offered on a Pilot:

LX4WD - 36 month lease, 12,000 miles/year
a) $2000 down - $326/month
b) $3500 down (includes taxes, title, etc. with $2K down payment - $280/month

OR they can get me an EX for $5 more per month. That seems like a no-brainer to me....to get the EX.

I was told that I'm getting the vehicle at like $200 over dealer cost or something like that. I haven't purchased a vehicle in many years. Its all new to me again. Your advice is greatly appreciated! Thank you!

jethro23

dddbbrown,

The current lease offer from Honda for a 2006 Honda Pilot LX AWD is $299 (36 months, 26,533.95 capitalized cost, 12,000 miles/year, 0.00058 money factor, 58% residual...given you qualify). Invoice price(including destination)is $25,922; but many people are reporting below invoice pricing (there seems to be some manufacturer to dealer incentive in play). If the dealer was truly offering you $200 over invoice using Honda's current lease offer, your payment would be lower than the advertised $299/month WITH ZERO DOWN (since cap. cost would be lower at $26,122...Invoice + $200)) Needless to say, you can do much better than $326/month with ZERO down...just first payment, license fees, and security deposit (although you can avoid this at a slightly higher money factor).

Many experts here advise against putting any money down anyways. Reason being, if the vehicle is totalled, you don't get that cash back. GAP is included in all Honda leases.

Good luck!

dddbbrown

Thank you for that helpful information. Now I feel more confused than ever. We almost went through with the lease scenario tonight but walked out because we are waiting on more specific information about being able to put graphics on the vehicle (using vinyl) to advertise our business and they weren't sure if we would be penalized at the end of our lease for any fading. So they are looking in to that. We are supposed to go back tomorrow and find out. But now, after reading your response I'm wondering if we should wait altogether and learn more about this process. Can I ask you this....do the dealers (Honda in particular) usually have leasing specials like this? I can't tell if we really should jump on these specials NOW or will others just as good come along. Its been many years since I bought a car and haven't followed it for many years. I don't want to get caught up in the "new car fever" and rush in to this if I can feel comfortable knowing that we can get a great deal by waiting a few weeks or so. Any opinions on that? I did have the Pilot today for the afternoon and loved it. I meant to get the VIN number and find out exactly what the dealer paid for it but I forgot as its been a very stressful day. Also, another thing to keep in mind with what you told me was that they were offering us an EX 4WD instead for $5 more a month. The selling price was $28,591 with a luggage rack, residual for 12,000 miles a year was 58% (15,000 was 56%) and the APR was 2.42 if approved. He didn't give me the money factor as it makes more sense to me to have the APR. How does this sound? THANK YOU SO VERY MUCH for your help.

dddbbrown

We have an S-Corp business. Does it matter if we put the lease in the business name or our individual names to have a business write off? Also, how does that work with auto insurance? Is it generally more expensive to insure a leased vehicle? Thank you!

boomer64

I leased an EX-L 2WD today. I did a lot of research on this board and I thank you all for such valuable information. I think is great to know some numbers and to get an idea prior to going to the dealership. I honestly do not know much about how "these guys" structure these things. They usually fill in those numbers and boom you get a magic payment. I did shop through some local dealers by using the internet. The bottonline is that I was looking to be at a certain point after considering buying or leasing. At the end it seems as it made more sense to lease because "why committ to buy the car when you can rent it for three years and then decide if you wnat to keep it at the residual value". Since the numbers were pretty close, I thought leasing is the way to go on the Pilot. I Leased the car for $1000 total out of pocket including first payment. I am getting the car for 36 months and 15K miles a year. My leased comes out to $378 a month plus the 6% Florida tax. The residual seems to be a little low at 50% with my buyout at $16,187. Some people of this board seem to have a higher residual. SO perhaps my payment might a little higher. Maybe???? I don't know. But waht I do know is that I had a good dealer experience. The dealership is 4 miles from my house. THe offer 24 hours Road Assistance no matter where I am just like AAA. Free Car washes at anytime. They even have their own gas station and they sell gas at about $.10 cents less than anyone else other than Costo or Sams. Hopefully, I did not overpaid too much, butI am really happy with the Pilot.

golic

I would recommend that if you are going to treat the vehicle as a "business" expense you put the vehicle in the name of the S-Corp.

Otherwise you would run the risk that the IRS could come in and deny the business expense and reclass the payments as distributions to the shareholders.

If you "really" wanted to cover all bases have the "board of directors" declare a corporate resolution to lease said vehicle for the officer in order to provide reliable transportation to conduct company business.

If your s-corp is less the 3 years old or not profitable you may get resistance to put in the Company name. Then I would just draw up an accountable plan for the business to pay for the expense.

Confused yet? Don't be, talk to your tax advisor and I have never seen "that" issue come up in an audit.

jethro23

dddbbrown,

Honda has been offering comparable lease specials each month on Pilots since November or December. As the months have progressed, they've tweaked the offer by changing the term (i.e. from 42 months to 36 months) and/or lowering the money factor since residuals decrease for current year models as the model year gets to closer to end.

Although I'm not absolutely certain, I believe Honda's motivation to offer these specials is to increase sales to match production (supply is greater than demand). Since Hondas have the best resale value in the industry, the residuals will always we decent. However, the money factor is what makes these offers special.

preetypilot

Hello Car_man,
Can you please post April's MF numbers and any other new incentives honda introducing this month.
I need to buy 06 Pilot EXL ASAP in FL and trying to figure out a fair deal. if anyone has recently leased pilot in Florida please share some info. You can even recommend me to any honda dealer in Florida and I 'll take the delivery or pick it up.
Thanks very much in advance

boomer64

I got my Pilot two days ago and Rick Case Honda. I can tell you taht for what I learned so far a few of the dealerships where willing to match or deal with the car. I paid. $1000 total out of Pocket, including first month. $377 a month plus the 6% tax. THis is for a 2WD EX-L. My lease is for 36 months and 15K miles a year. THey gave me two free oil changes and a discount card for unlimited car washes, and discount gas. Maybe there are better deals out there, but it was a very painless transaction so if I paid a little more than others, I can live with it because I did not have to be in the dealership all day playing games. THe car is outstanding.

preetypilot

today i leased 06 EX, i think i did good thanks to this forum.

$324.00 + 6.5% tax= 345.00
$650 down including 1st month and dmv
cap cost $27936.70
residual $16552 (55%) set by honda dealer wouldnt budge on this, EX-L has 52% residual
12k miles /year

suzanne17

Thank you! Great info.

When I am emailing the internet departments for quotes - what specifically should I be asking them for? Other than telling them I want bid on 2006 Honda Pilot 2WD EX-L, color, 15K miles, 36 mos?

golic

Suzanne,

From what I have learned at Edmunds, the more detailed information you put in your email, the more the ISM will take your request seriously.

Remember they recieve tons of emails a day, most with no name, etc...

I would include everything you mentioned above, including the interior color. Also, any options you may want or more importantly DO NOT want. Most Honda Dealers love to put the wheel locks and mud guards on cars as these can add hundres of dollars to the price.

In addition:
1. Provide your real first name.
2. Tell them you prefer email contact, but leave a phone number and time they can call if they absolutely have to.
3. Ask if they have the car you requested in stock.
4. Let them know how soon you plan to buy.
5. Ask them to include in the quote the money factor and the residual they used to calculate the lease payment.
6. Let them know if you intend on putting anything down. On a lease I would do nothing more than, TTL and first month, but YMMV.
7. Let them know if you have a trade you will consider.

The more information you provide, the more serious they will take your request and release info.

Some dealers, will not email you a price, because they don't want to get shopped and may want to call you to do it over the phone.

So be prepared to go that route. If you negotiate over the phone, I would have them fax you a buyers order and after your acceptnace you can call back with a deposit. This will elimnate any we can't do this or you misunderstood us shennanigans when you go in to sign the paperwork.

goodl luck

stuart9

Wish I had thought to look at this forum ahead of time...but in an effort to stop kicking myself, how did I do? Purchased the day after the Leadership Lease program ended and still got a Leadership Lease. Honda Pilot EX AWD

MSRP: 30745
Agreed upon value: 28903.29
Gross Cap Cost: 33768.64
1069.01 Down (Includes cap cost of 600 & 1st Payment)
Total Payments 16884.36
Residual Value: 17525.2
36 months
15000 miles
Tax in VA is 4%
Monthly payment 469.01
And now the important part, rolled in significant negative equity --- approx 3000 (couldn't do better anywhere)
Don't plan to keep the vehicle at the end

Based on the calculator on this website I did spectacular...but is that in line with the program?

Thanks.

golic

Stuart-

The deal is done, don't go back and worry how you did. You signed the papers, you apparantley thought it was fair.

Just ENJOY the car.

boardman

In NY I have an agreed purchase price of $31,850, including destination for an EXL with Nav. For a lease with owner loyalty I am being offered a money factor of .00058, a residual of 53% on 12K and 51% on 15K. The only CAP Cost would be a $595 lease fee to Honda Financial. Quoted payment is therefore 404.03 without tax rolled in for 12K, and 423.56 for 15K.

Is this accurate and consistent with the current Honda program?

Thanks

dddbbrown

I'm hoping to finalize this leasing transaction today. We are offered the LPO Lease or a standard Lease. As it was explained to me is that the LPO (last payment option)is where WE actually own the vehicle (which confuses me if its a lease)and don't have to re-pay the sales tax should we decide to purchase the vehicle after the 36 month lease. With a standard lease this isn't the case. Does this sound right to you? Both ways we have the option to turn the car in, refinance or buy it outright. We have been approved for the 2.42%, which is great and is going to keep our payments in the $320's range on 12K miles/year. We will pay up front the taxes, etc. I'm told that the residual is 58%. I'm guessing this is good? Thank you for your help.

smith1

It sounds like what you are calling the "last purchase option" is what Honda Finance calls the "Leadership Purchase Plan". If so, this is actually a balloon note purchase. It is similar to a lease in that the monthly payments cover just depreciation and finance charges, and the large final payment is the "balloon" which you can then refinance or else walk away. The sales tax advantage you describe is consistent with what I've heard -- since it is actually a purchase your name is on the vehicle title from the beginning (as opposed to a regular lease where the leasing company's name is on the title) so if you decide to keep the car there is no change of ownership on the title therefore you don't pay sales tax again. This is a significant advantage if you live in a state that taxes the full value of the vehicle when you lease and then assesses tax again if you buy the leased vehicle. Illinois is one such state. What state do you live in?

The other advantage of the LPP that has been discussed in these boards is that if you decide to refinance the vehicle at the end of 36 months you are supposedly guaranteed the same interest rate you had for the first 3 years. Were you told this would be the case if you went with the LPP? I haven't seen this feature described on the Honda Finance website but some on these boards have claimed the actual LPP contract has wording that says you can refinance "at terms no less favorable than the original terms" or something like that. If true, this (plus the more favorable sales tax treatment) would be a strong reason to go with the LPP vs. a standard lease, if you think you might want to buy the vehicle at the end. I'd very much like to know if this "guaranteed interest rate" for purchase at the end of the 3 year term is for real.

suzanne17

Golic - GREAT info - Thank you much.

What does YMMV stand for?

CarMan@Edmunds

Hi rosen31. Yes, Honda Finance's .00058 buy rate lease money factor for 2006 Pilot 4WD models was extended through the end of April.

Car_man
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CarMan@Edmunds

Hey unbroken_pete. Honda Finance charges an acquisition fee of $595 on every vehicle that it leases. Individual dealers do not have the authority to waive this charge, but you can roll it into your vehicle's capitalized cost to avoid having to pay it at lease signing if you want to.

Car_man
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CarMan@Edmunds

A credit score of 710 or higher is necessary to qualify for Honda Finance's "Super Preferred" credit tier.

Car_man
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CarMan@Edmunds

Congratulations on your new truck, Roscoe. I'm glad that you found this discussion so helpful. Enjoy!

Car_man
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CarMan@Edmunds

Hello preetypilot. You should be able to get a good idea of how much you will have to pay for this truck right now by visiting the following very active discussion: "Honda Pilot: Prices Paid & Buying Experience". Once you have an idea of how much you should pay, stop back here with that number and its MSRP and I'd be happy to estimate what your lease payment should be like on the truck that you are interested in.

Car_man
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CarMan@Edmunds

Hi portpilot. The "assignment fee" that you mentioned is also known as an "acquisition fee" or a "bank fee." All banks that lease vehicles to consumers charge this sort of fee and dealers do not have the authority to waive it. I'd be happy to give you my opinion on this deal, but it would be a big help if you would provide me with this truck's full MSRP (with the destination charge added in) first. This number will enable me to see how much of a discount you are being given and to use Honda's actual lease program to estimate what your lease payment should be.

Car_man
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CarMan@Edmunds

Hi georgec1. Honda Finance's current buy rate lease money factors are .00058 for all 2006 Pilot 4WD and .00012 for all Pilot 2WD models. These factors assume that you pay a security deposit and qualify for Honda Finance's "Super Preferred" credit tier. These trucks' residual values vary depending upon how long you lease them for and how many miles per year you need to be able to drive them. If you were to lease for 36 months with 12,000 miles per year, Honda Finance's current residual values would be 55% for '06 Pilot EX 2WD models, 58% for Pilot EX 4WD models, and 55% for EX-L 4WD models without the navigation option.

Car_man
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