with the current health, or lack thereof of our economy what exactly is a high yield checking account?
just curious.....what is the return? any current numbers? i recently signed up for a money market account at my bank with 8K+ and am not even receiving (1.8%) anything close to the inflation rate??
I have been shopping around for a couple weeks and have been finally offered the below deal. Doing the math, I think I am about $750 over invoice (with the doc fee).
G35 Journey w/ Prem Pkg only
24 month, 12k mile lease Tier 1 credit MSRP $35,515 Adj Cap Cost of $35,065 includes the following $595 Acquisition fee $600 DMV fee (AZ) $541 1st Payment $495 Doc Fee
$0 due at signing with the 23 remaining payments at $541 (including 8% tax).
I would love to get this down another couple hundred but I am not having any luck. We only have 4 Infiniti dealers in Phoenix (2 of the 4 owned by the same company) and 1 more in Tucson about 2 hours away.
I can get the VPP discount, but every dealer has a $400-500 doc fee so I am in the same ball park with price.
I will try one last time when I go do the final deal, but I am ok with paying the extra $10 or so a month to get the car. My bigger concern is that I want to make sure I am good with the math before pulling the trigger.
i think you'd find most of the educated lease folk on here, not including myself in that category, would tell you this:
a good deal would be one that is $500 above invoice, including dest fee and dealer doc fee's. i'm NOT SURE if that "good deal" includes the acq. fee of $595 or not?
i also think that these guys are going to tell you this:
we need to know the exact options of your car, as well as the invoice price etc. all that information can be found on edmunds.com i'd STRONGLY recommend brushing up on your lease knowledge/education before making a deal. take time and read these posts. in them you'll find the information you need, while at the same time nobody will be able to afford the time to walk someone through hand in hand.
here are a few things you need to figure your deal:
invoice money factor (ask the dealer, per "dennis" if they won't disclose this info, don't deal with them.)
bottom line is to educate yourself or pay later. IMO, without knowing your mf or invoice, i'd say you're not getting a good deal. the msrp and cap costs are too close?? i have an invoice on the same car, add sport edition for $34,600ish, and that was from the dealer, not edminds. the edmunds invoice is $34,200 something. something ain't right in your deal.....
but then again, i'm nowhere near an expert or claiming to be. just trying to help a fellow person in my same situation. best of luck!
I currently lease a 2006 G35 6MT -- the 39 month lease runs out in 15 months. This is my second G and I have been very pleased with it. I have also invested in a set of Dunlop Sport M3's for the winter (nearly a grand) that have made my car feel absolutely blizzard proof.
I am now wondering whether I should go ahead and buy the car at lease end (the residual was about 21k), rather than re-lease another vehicle. I would very much appreciate your thoughts on the matter!:) Thanks.
Hey, unfortunately my employer isn't on the list. A friend of mine works for a company on the list and he is telling me that if he comes in with me that I would be eligible. Is this true? I told him I dont think so.
Dr.Justin - was the sale price and MSRP that you gave made up? I am looking for an 08 Journey with the same options and based off Edmunds the MSRP for those options is $41215 and the optomistic Sale Price I was hoping for of $500 above invoice is - $38,137. Please let me know because if you did get quoted on the car at the price above I will be shooting for that price then as opposed to the 38 grand.
The new design G is even nicer than the old design, so that is something to think about. I would wait until closer to time to have to decide and compare the real world trade in value of your used G (given the options, miles, and condition) against the buy out price. I would not want to overpay just to keep the car, not when you can get a new G for near invoice and leased at a below market rate. If you end up over miles and having to pay a penalty if you turn it in, that can help make a case for keeping it.
Nope, that will not work. The person who buys or leases has to have the claim code in their name and in the case of a business partner they have to show proof of employment for the company they used to get the discount.
If your friend is under the C plan, it seems he can sponsor a friend or extended family. VPP Program The VPP is not bad, but it is possible to get a lower price than VPP in some parts of the country.
That is true, but C plan means the friend works for Nissan / Infiniti and NOT for a business partner / vendor. So if the friend works for a bank, insurance company, etc then they can get plan D but not pass it on. If they work for Nissan then they can get a plan C code for their friends.
All you need is a copy of the Nissan employee's ID card and you / they can get the claim number online. When you get to the dealership you give them the claim code and the copy of the Nissan ID and you are all set. There is no need for them to go to a dealership with you.
so the "negotiated price in dollars" should include all taxes, fee's dest charges....meaning ANYTHING one plans to finance or roll into the loan correct?
all i did was go to edmunds and enter my area and options. one thing to note on edmunds, DO NOT add sun roof as long as there is a premium packg, also don't add sport wheel packg, if it includes the "sports packg." also, enter in journey instead of sport edition, UNLESS you're wanting 6MT.
go back and enter the specs in edmunds:
invoice 29,709 trunk cargo net 46 prem pckg 2,155 splash 114 sport pckg 1,422 trunk mat 75 dest 715
= 34,236
i live in oklahoma but plan to go buy it in texas as they'll deal with me. in texas every dealer ad's $160 to the cars for advertising.
so 34,236 + 160 + 500 above invoice=34,896
i'm give or taking a little and allowing 35,050
i have yet to offer that price but am thinking about it. in talking to the dealer, i know we're close. i might even come in lower.
Yes, that is the net cap cost. Your price less any cap cost reductions, rebates, etc plus anything you want rolled into the lease (taxes, $595 bank fee, etc).
I always use carsdirect.com for pricing and options. It will not let you make mistakes picking packages (you can't get Nav w/o premium, etc) and includes the destination cost in the invoice shown. You can also put in various ZIP codes and see what a dealer is willing to sell that car for in various areas of the country.
ok sir. i think i've got the numbers to a point where i'll start emailing dealerships in hopes of landing what i feel to be a "fair" deal, BUT before i do i want to pass my numbers by you and lay out my thought process.
car details= g35 journey, prem, splash, sport, net, mat (nothing else)
as priced out through casdirect, the msrp is 37,935 (this also matches what the dealer told me)
Oklahoma tax= 3.25 x msrp= 1139.12 (both states tax entire amount) residual= 22,381 (.59 x 37,935) 15,000 acq fee= 595 invoice= 34,655 (this DID NOT match what the dealer told me as he said they needed to add "blank" blah and blah(advertising fee/windex expense fee/marble showroom floor polish fee))
i plan to offer the dealer 35,050.00 and forget the other add on's
plugging the numbers in: option 1 MF=.0015 over 36/mo (they cannot mark up the MF to my understanding at 36/mo?) total financed= 35050 + 595 + 1139.12= 36,784.12 mo paymnt= 488.83
option 2 MF=.0018 over 39/mo (allowing them to make a tad on the back end. figured they'd be more apt to accept the deal) total financed= 36,784.12 mo payment= 475.80
the only other configuration i'm considering would be dropping to 12,000 mile program either 36 or 39/mo
thoughts/questions/comments/ideas?? anything you'd do different? please.
Some car makes and areas do have legit "ad fees" added to their invoices to cover the cost of region advertisements. If your area is one of those then that might be a legit item. As always, if they dispute your list number ask them to pull the invoice for that car and show it to you.
I would find out their dealer doc or prep fee and offer them your price with that included and spelled out, or without that included for them to add back on. If the fee was $250, for example, you could offer them $200 over invoice to net out at $450 over.
I would get the price of the car nailed down first and not bother with any lease numbers now. Once you have the price nailed down, then mention that you want to lease it at that price and at the lease buy rate and see what numbers they come back with.
ok. thanks for the help. so the invoice amount according to carsdirect and the dealer is $34,655.00 including destination, say they have a $250 doc fee. i should offer them 38,855?
any say we agree on a price, what's the comeback when they say we can't get you the MF you requested. with a 673 fico, i'm on the cusp, and with any dealer who does a decent volume, hopefully they'll request IFS to buy that rate??
this should be fun. now i see where you're going with all this stuff. hypothetically, we get the price nailed down, and they accept my MF terms etc. HOWEVER, they come back with a payment that's $30 more/mo than what i calculated. i'll be able to say.....hold the phone mr. please give me the numbers you're working with. b/c this is what i compute the "blank" and "blank" to be that amounts to "blank."
thanks again for the insight! how many cars have you leased may i ask? or did you use to be a finance manager? do tell if you will oh kind sir of infinite leasing wisdom.
Never worked at a car dealership, I worked in computer hardware and now software. If my count is right, 9 past or current leases and if things go well number 10 will be picked up in a few weeks .
Funny thing is when i spoke to a sales rep after getting an internet quote the day before yesterday, the guy could not be convinced more that i was in the car business. Its amazing after a couple leases you get to know more than some(maybe most) of the sales people out there. Hoping to get into a new G37 by the end of the month, but not sure whether to wait for the June rates or take the leap and get it in May. My current G is due back second week of June.
A couple of dealers have quoted me 715 destination. Which invoice is correct? Which destination charge is correct? The difference in price is over $400 and when trying to get within $500 of invoice price that can make a big difference.
EDIT: The base MSRP prices are different too $39,725 vs $40,180 What's interesting is i have seen both MSRPs quoted from different dealers.
Dr Justin. The Excel file is a quick thing I threw together and it may have some bugs, but I emailed to the address you gave just in case you were still looking for one.
Few know that Infiniti Finance allows you to "loan" them additional security deposits for the life of your lease (which you get back at the end of the lease)...and for that, they will reduce the MF by .0001 for each extra security deposit you leave them....maximum of 7. When I say few...I include the infiniti salesmen and in many cases the local infiniti finance guy. If you find a dealer who knows nothing about this, ask them to read their literature...this is offered as a standard part of the infiniti lease. For those in NY state, don't bother to read any further...NY does not allow multiple security deposits, sorry.
In order to understand how this option effects your situation, you have to focus on the total cost of the lease.....and forget monthly payments. Most folks just want a low payment which is why you see all the ads with $3000 down and such...they are just playing with numbers.
This applies to anyone who is thinking of making any capital cost reduction up front....or can afford to loan $2000 or so in security deposits to Infiniti for the life of your lease. It is a way to lower the total cost...and that's what you want.
Few dealers even understand how this works....I am the only one in the past two years who took this option at my local infiniti dealer...because it's hard to explain and everyone is focused on the monthly payment which is financially wrong.(note: my dealer agrees with me, but it's too hard to explain so they don't push it).
Here's how to understand this:
Get a lease quote from your dealer with no money down at signing...just first month lease payment and taxes/title/registration....roll all other fees (dealer fees/bank fees/anything else) into the lease. Now add up your first payment plus all of the other payments to find out how much the total lease costs.
Now ask the dealer to figure out the lease with multiple security deposits...(you can do up to 7 as long as the MF doesn't drop below 0). The payments will be lower as will your first payment...but of course you have to give them the MSD dollars. Add everything up...The initial payment, the rest of the monthly payments and add in the extra security deposits.....but then you get the security deposit back at the end, so subtract out that security deposit...and now you have the total cost of the lease. The total will always be less than the first case. Now take one more step because you say, I could have had that money in a bank (or somewhere) earning interest...but I gave it to Infiniti where they don't pay me interest. OK....let's assume you put the money in the bank at today's 3% (or pick your rate)....figure out how much you will earn in the bank...that's the amount you lose in this deal....so ADD it to the total cost of the lease. Are you with me? Your total cost is what you pay nissan..plus the loss of being able to get interest in the bank on those multiple security deposits.
Finally, do the case that most dealers push.....now that you know the amount you would loan infiniti for Multiple security deposits which you get back, look at the case where you use those same $'s as a downpayment/capital cost reduction. Ah...the monthly price is much less, but now add up all the costs...this time you are adding your first payment which includes those extra capital cost reduction dollars, and then adding in the rest of the payments...you don't get any of it back.
If you did all the above right, you will see that the no money down case is the most expensive, putting some cash in up front does lower the total cost of the lease a little, but the Multiple Security Case lowers it the most.
I have heard of this with BMW and Lexus, but this is the first from Infiniti.
One of the questions I read about in a Lexus forum was what happens if your car is stolen and not recovered? Will the insurance company payoff the remaining lease LESS the security deposit(s)? Or will Infiniti send the pay off amount due to the insurance company not including the security deposit and after Infiniti is paid, will they refund me back the security deposit(s)?
One other question, is the amount of each security deposit = to your monthly payment?
You get it back. Reason being the security deposit is there to make repairs at lease-end. Since the car is totalled or stolen, there are no repairs to make. The leasing company is made whole by the insurance company. They have no cause to keep the security deposit.
You don't save any sales tax because tax is based on the purchase price or depreciation amount (depending where you live) and is therefore calculated before the cost of the money (money factor) is added in.
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
IFS says payoff is $35,500... ($39,500 - $4000 security deposit)
Shortage of $500 covered by GAP insurance.
$4000 in MSDs gone.
Call your insurance agent: "We paid fair market value for the car, what you owe on it is not our concern". (no diffferent than if you had a loan)
Call GAP insurance carrier: "We cover the difference between what the insurance company pays and what IFS says you owe."
Call IFS: "Your security deposits are security to make sure we get paid. That's what we used them for."
Of course, the last statement from IFS is the sticky one... You know and I know that isn't how it is supposed to be structured, but when there are three other parties involved, the buck can be passed, indefinitely..
Now... IFS or your dealer aren't going to look for ways to keep your deposit when you turn your lease in, at end of term.. You'll owe what you owe, regardless. But, in the event of totaling your car, I wouldn't bet on getting them back. That doesn't make it right.. and this might not ever happen, but I don't think you'll find anyone at IFS that will guarantee that for you.
He called IFS and his insurance company and reported:
Only small warning to include (I spent several hours on the phone with IFS and my insurance company to get a definitive answer) -- just as in the case with a cap reduction, if the car is totaled, the deposits are not refunded. You mention in the post "in the event of a total loss your insurance satisfies the lease bank" -- which is what I thought when I decided to investigate this option before signing my lease in 05.
I know this does not make sense (the bank is satisfied), I know it's counterintuitive, but unless you can get something in writing from IFS, I would stay away from this option or at least consider the extra risk.
So unless I had something in writing from IFS to explain how and when the MSDs would be used and not refunded *I* would not want to risk that much money.
In answer to my own posted question above regarding the differences in edmunds.com and carsdirect.com, now that I see it I recall reading on here about it, the reason for the difference in price is a price increase.
MSRP (base) from $34,350 to $34,750 ($400) Destination from $715 to $765 ($50) Splash guards from $150 to $155 ($5)
400+50+5 = 455 (which equals the difference in MSRP prices I was given by 2 dealers). Which was $40,180(dealer 1) - $39,725 (dealer2) = $455
Bottom-line edmunds.com has old price and carsdirect.com has new. One of the dealers is quoting new price price, the other the old price.
Thank you, Dennis, for your quick and thoughtful response! Another issue I was wrestling with was about how well the G35 held up over a longer time horizon. It is nearly bullet-proof over a three or four-year term. I was not so sure about how it fares over 7 or 8 years. If it held-up really well, it would make sense to buy my car at the end of the lease -- there is no way I can get this combination of power, handling, and comfort for 21k! On the other hand, I will eventually have to downsize and economize as I approach retirement -- so enjoy while I still can!:) In any case, like you said, waiting and watching is prudent. Thanks, again. Raj
Ok, so one last time - a good deal right now is to negotiate the dealer to $500 above invoice price. Is this $500 above invoice including the cost of the car, destination charge, bank fee, dealer acquistion and other costs all rolled into one? Or is this just for the cost of the car plus destination charge?
If someone could explain what exactly I should expect to negotiate into the cost of $500 above invoice it would be greatly appreciated. Also if you can tell me what other fees I can expect to pay(ie... license, tax, etc).
You can go to the Infiniti web page a build a car and see the price. How does that compare to the MSRP shown at carsdirect.com? Should be the same thing, including the $765 destination charge.
What you have to do is pick out the car you want and note the MSRP and build date. If it is a recent production car the MSRP should match what you see at carsdirect.com and the Infiniti page. If so, then the invoice shown should be correct. If the MSRP of the car you pick is less, then it is an older production car. What I would do is take the price different at MSRP and subtract if from the current invoice. That should be close enough to the actual invoice.
Thanks for the quick response dennis. So essentially when I look up the Invoice price on Edmunds they say its $38,111 and thats including a $715 destination charge. So I should be willing to pay $38611 + bank fee, tags, title, and tax.
Any idea how much tags and title are in NJ?
Again I really can't thank you guys enough. I have what I should be paying as the base cost, an estimate of the additional fees, money factor, and residual value, so its simple calculation at this point for the monthly cost. You really do make things much easier then haggling the heck out of these guys.
I agree... it doesn't make sense, but very scant evidence from anyone that has had it happen..
Everyone on BimmerFest says you get them back... but, they are only using common sense (rare commodity in insurance circles...) I've yet to hear a real-world example from anyone over there..
Watch Edmunds invoice prices as they don't include destination - you have to add that for yourself. Check KBB and carsdirect.com as well to see how their numbers compare. Someone was just complaining that Edmunds still has the old, pre price increase numbers up. If you pick a car that was made before the price increase, then you have to allow for that in what you should offer or pay.
I don't know your local stuff, but a quick call to your local clerk or DMV should get the answer - or see if they have a web page showing title and tag fees. The dealers almost never mark this stuff up so you are fairly safe letting the dealer's figure them. The only thing I have seen is some dealers charge a "notary fee" or "title processing fee" which is just an additional dealer "doc" fee with another name. One out of state dealer had the nerve to stick that on my paperwork one time. I reminded them they *I* would be going to the clerk's office in my state and paying the tax and doing the title work, so no way was I going to pay them for not doing it.
The idea is to deal on price first, then plug it into a lease calc and see how it looks. Dealing from payments is a position of weakness for the lessee (you).
Having had some experience with property damage recovery, i can tell you first hand that the insurance company doesn't just pay the bank off what is owed to them or what they state is owed to them; nor do they run the numbers based on what the bank has as a deposit. They have an appraiser value the vehicle or run a valuation report and IF within reason pay off the loan amount. The only risk comes in when the appraisal of the vehicle is below the payoff amount. From my experience, this risk comes in 1 in 5 times, and it always happens when someone finances the vehicle at a very high rate of interest and the principal doesn't build quickly enough in the vehicle to satisfy the payoff amount which remains high.
With IFS leases the risk only comes into play is when you have a high residual, and if by chance your vehicle is either stolen or a declared a total loss, the appraisal comes in below the actual payoff. This can happen in the early stages of the lease as the vehicle loses a lot of value immediately after you leave the lot.
There are two ways to address this issue. First you can purchase gap insurance which i believe will insure one for the difference between what one would owe on a vehicle and what an insurance company says it's worth. Second, when you buy insurance coverage you need to check with your insurance carrier if the gap coverage is built into your premium. Good insurance companies will usually provide this coverage as part of their quote, but again you need to check with them specifically on this issue. Furthermore, i'm inclined to believe that IFS itself should provide this gap coverage on every lease or finance deal as they are exposed to this same deficit in capital if in fact one of their vehicles is involved in a collision where the car is totalled or stolen.
I also don't believe that because you don't have a deposit in place you are less exposed to the same risk. Whether IFS has a deposit or not, if they are owed money they will come after your via legal avenues. So if you leased a car and your car is stolen 3 days later, why do you believe the person that doesn't have a deposit is any less responsible for the full value of the vehicle as the one who does?
I can't imagine IFS is going to get paid twice for what they are owed. If the car has a payoff of X dollars and the car is totalled or stolen and that payoff is satisfied why would your security deposit not be refunded.
The example your brought up about ownership vs. rental is only half accurate. If you rent an apartment and paid $1,000 per month for the apartment and initially you had put up 2 security rent deposits to the landlord and then your apartment burns down would you also lose your security deposit? I don't believe so, because as long as you paid the rent timely, your deposit should be refunded if the apatment is not livable in and the landlord asks you to vacate.
I agree with you - that is the way MSDs should work, but someone posted that they spent hours on the phone with IFS and was not it did not work that way, so they passed on an MSD lease.
As I said before, if you can't get something in writing from IFS about how the MSDs are used, kept, and refunded I would not recommend that anyone do an MSD lease.
The sweet spot right now is 24 months...not 36/39 months. Have the dealer run both...then divide the total cost of each lease by the number of months to find the total cost per month. Don't trust your dealer unless you see the numbers..
IFS says payoff is $35,500... ($39,500 - $4000 security deposit)
IFS's payoff is not 35,500, it is 40,000 minus your first month payment.
Shortage of $500 covered by GAP insurance.
The purpose of GAP insurance is to cover the difference between the value of the vehicle and the payoff amount. $500 is an arbitrary number and is not an actual number, so i'm not sure where you received this information from. Insurance companies are regulated by the Department of Insurance, they can not reneg on a policy unless you are in violation of policy rules.
$4000 in MSDs gone.
Again, assumption.
Call your insurance agent: "We paid fair market value for the car, what you owe on it is not our concern". (no diffferent than if you had a loan)
This is true. They have to do an actual appraisal report. But they also have to keep you as a customer. They do their best to come up to the most reasonable fair market value with comparables.
Call GAP insurance carrier: "We cover the difference between what the insurance company pays and what IFS says you owe."
What you owe is the payoff amount, this doesnt involve the security deposit. If you put 10k in the bank and the bank burns down, does the bank give you a call and say sorry your money burned down and you no longer have any balances here? IFS like any other bank is regulated by the Banking authorities. They can't just take your money because they feel like it, what you are suggesting is flat out fraud as it is unsubstaniated by facts.
Call IFS: "Your security deposits are security to make sure we get paid. That's what we used them for."
No, what they use them for is to ensure that you don't bring the car back in horrible shape and do not pay them for the repairs. And it is also to give them assurance that in the event that you default on your loan, they have some added security that they won't lose as much on the vehicle.
But lets compare an alternative scenario.
You buy a car, you put up $2000 for upfront fees which involves first month payment, acquisition fee, motor vehicle fees, doc fees, etc. Car has a price tag of 40k and a payoff amount of 39,500. You crash into a tree the day after your picked it up off the lot. Now your insurance company pays off $35,000. IFS says hey brother, you still owe us $4,500 and if you don't pay us within 5 business days we take you to court. You wind up not paying and they put a lien on your house, your boat, your wife and your kids. Then they file a summons at the local court house and you find yourself scrambling to find an attorney that charges $1,500 just to show up to court. After you show up to court, the judge postpones the hearing because she had the runs from the chinese dinner she had the night before. So now the hearing is rescheduled for 2 months. The lawyer now wants another $500 to show up because time is money. So you make an appearance in front of the judge and the judge says why are we here today? IFS attorney says Mr. HOSTMAN owes us $4,500 for his lease. Judge says does defense have anything to add? So the rinky dink attorney you hired says no 'mam i think we are all clear here. So the judge rules in plaintiffs favor and you wind up paying $4500 back to IFS.
So lets analyze this scenario. You put up $2k in initial cost that you lost. You paid $2k to the attorney who showed up in his fancy suit and did nothing, and you are now out another $4500 to IFS because in all fairness you still owe them their money. So you are out the same $4k that you would have in Multiple Security Deposits except you now lost countless hours of sleep, exhausted your vacation and sick days at work and you still dont have a car.
My point is simple, just because you don't have a secrurity deposit in place doesn't mean you cant be sued or are off the hook for what you owe.
Just when you thought you knew everything about insurance — along comes gap insurance.
Though it may sound trivial, gap insurance is a must for leasing. And if you made a small down payment when buying a car, a gap policy can be lifesaver as well. But first, let's look at why it exists.
As the name implies, gap insurance covers what traditional auto insurance doesn't. In other words, it closes the gap between what your insurance company pays if your car is stolen or totaled and what you owe the finance company.
Let's take a test case. Say you bought your car two months ago for $25,000. You begin making payments at about $500 a month based on a 6 percent interest rate. Then, disaster strikes: a tree falls on your car and flattens it.
You call the insurance company and it looks into its crystal ball and decides at the time of the accident your car was worth only $20,000. The car may only be a couple of months old, but it has already lost 20 percent of its value. Unfortunately, the finance company still wants the full amount you owe them. With interest, tax and license fees, they figure that to be $27,000.
Yikes! There's a gap of $7,000 between the $20,000 that the insurance company is willing to pay you and the $27,000 the finance company is demanding. Most folks are going to be eating Spam dinners for the next two years, but if you have gap insurance you can safely order steak.
Apply the same scenario to someone who bought their car. If they left the dealer lot without putting several thousand dollars down, they likely owe more than the insurance company will pay if the vehicle gets totaled or stolen in the first few years. Once again, gap coverage can save the day.
And that's why gap insurance is a must for many drivers. In fact, gap insurance is usually mandated by lease contracts or included within them. If a gap policy is required but not included in your contract, you should shop around for this coverage (insurance companies sell it). If gap coverage is included in the lease, check to see how much is offered and how much you're going to be paying for it. (In some cases, lease contracts may include what is known as a gap waiver, which protects you from gap charges in the event that the leased vehicle is declared a total loss — eliminating the need for a gap policy.)
Is gap insurance necessary for people who finance their cars? Well, it depends on your coverage. If your regular insurance policy is written to pay off the fully financed amount, then you don't need gap insurance.
A few things to keep in mind when buying gap insurance:
Although most people purchase it when a lease is initiated, some insurance companies will sell you a gap policy anytime during the lease term. You must be in compliance with all terms of the lease. Your gap insurance policy may not be honored if you don't have collision and comprehensive insurance coverage. Further, lease contracts generally require that you carry collision and comprehensive at all times. If your car is totaled, or stolen, carefully follow all requirements made by your insurance company. For example, some companies require you to continue making loan payments on your totaled car until the money from the gap insurance is paid out.
So when initiating a car loan or lease, always remember to ask your insurance agent or loan officer about gap insurance. If you have an accident you'll be glad you planned ahead.
Comments
just curious.....what is the return? any current numbers? i recently signed up for a money market account at my bank with 8K+ and am not even receiving (1.8%) anything close to the inflation rate??
i'd love to have that excel spreadsheet. I'm a doctor and not a MS Office guru. Would you be kind enough to email it to me?
jsnyder at drjustinsnyder dot com
G35 Journey w/ Prem Pkg only
24 month, 12k mile lease
Tier 1 credit
MSRP $35,515
Adj Cap Cost of $35,065 includes the following
$595 Acquisition fee
$600 DMV fee (AZ)
$541 1st Payment
$495 Doc Fee
$0 due at signing with the 23 remaining payments at $541 (including 8% tax).
I would love to get this down another couple hundred but I am not having any luck. We only have 4 Infiniti dealers in Phoenix (2 of the 4 owned by the same company) and 1 more in Tucson about 2 hours away.
I can get the VPP discount, but every dealer has a $400-500 doc fee so I am in the same ball park with price.
I will try one last time when I go do the final deal, but I am ok with paying the extra $10 or so a month to get the car. My bigger concern is that I want to make sure I am good with the math before pulling the trigger.
i think you'd find most of the educated lease folk on here, not including myself in that category, would tell you this:
a good deal would be one that is $500 above invoice, including dest fee and dealer doc fee's. i'm NOT SURE if that "good deal" includes the acq. fee of $595 or not?
i also think that these guys are going to tell you this:
we need to know the exact options of your car, as well as the invoice price etc. all that information can be found on edmunds.com i'd STRONGLY recommend brushing up on your lease knowledge/education before making a deal. take time and read these posts. in them you'll find the information you need, while at the same time nobody will be able to afford the time to walk someone through hand in hand.
here are a few things you need to figure your deal:
invoice
money factor (ask the dealer, per "dennis" if they won't disclose this info, don't deal with them.)
bottom line is to educate yourself or pay later. IMO, without knowing your mf or invoice, i'd say you're not getting a good deal. the msrp and cap costs are too close?? i have an invoice on the same car, add sport edition for $34,600ish, and that was from the dealer, not edminds. the edmunds invoice is $34,200 something. something ain't right in your deal.....
but then again, i'm nowhere near an expert or claiming to be. just trying to help a fellow person in my same situation. best of luck!
I am now wondering whether I should go ahead and buy the car at lease end (the residual was about 21k), rather than re-lease another vehicle. I would very much appreciate your thoughts on the matter!:) Thanks.
was the sale price and MSRP that you gave made up? I am looking for an 08 Journey with the same options and based off Edmunds the MSRP for those options is $41215 and the optomistic Sale Price I was hoping for of $500 above invoice is - $38,137. Please let me know because if you did get quoted on the car at the price above I will be shooting for that price then as opposed to the 38 grand.
Dennis
=((A3-A4) / A7) + ((A3+A4) * A9)
Where:
A3=your negotiated price in dollars
A4=residual in dollars (MSRP including destination * residual percent)
A7=term in months (e.g. 36)
A9=money factor (e.g. 0.00170)
So if you paste in the formula and put the values needed in the cells indicated, you have a payment calculator.
Dennis
Dennis
The VPP is not bad, but it is possible to get a lower price than VPP in some parts of the country.
All you need is a copy of the Nissan employee's ID card and you / they can get the claim number online. When you get to the dealership you give them the claim code and the copy of the Nissan ID and you are all set. There is no need for them to go to a dealership with you.
Dennis
Thanks.
so the "negotiated price in dollars" should include all taxes, fee's dest charges....meaning ANYTHING one plans to finance or roll into the loan correct?
all i did was go to edmunds and enter my area and options. one thing to note on edmunds, DO NOT add sun roof as long as there is a premium packg, also don't add sport wheel packg, if it includes the "sports packg." also, enter in journey instead of sport edition, UNLESS you're wanting 6MT.
go back and enter the specs in edmunds:
invoice 29,709
trunk cargo net 46
prem pckg 2,155
splash 114
sport pckg 1,422
trunk mat 75
dest 715
=
34,236
i live in oklahoma but plan to go buy it in texas as they'll deal with me. in texas every dealer ad's $160 to the cars for advertising.
so 34,236 + 160 + 500 above invoice=34,896
i'm give or taking a little and allowing 35,050
i have yet to offer that price but am thinking about it. in talking to the dealer, i know we're close. i might even come in lower.
those are my thoughts for what it's worth.
For plan D the spouse who worked for the company that qualified for the plan would have to be at least a co-signer on the deal, I would think.
Dennis
Dennis
Dennis
ok sir. i think i've got the numbers to a point where i'll start emailing dealerships in hopes of landing what i feel to be a "fair" deal, BUT before i do i want to pass my numbers by you and lay out my thought process.
car details= g35 journey, prem, splash, sport, net, mat (nothing else)
as priced out through casdirect, the msrp is 37,935 (this also matches what the dealer told me)
Oklahoma tax= 3.25 x msrp= 1139.12 (both states tax entire amount)
residual= 22,381 (.59 x 37,935)
15,000
acq fee= 595
invoice= 34,655 (this DID NOT match what the dealer told me as he said they needed to add "blank" blah and blah(advertising fee/windex expense fee/marble showroom floor polish fee))
i plan to offer the dealer 35,050.00 and forget the other add on's
plugging the numbers in:
option 1
MF=.0015 over 36/mo (they cannot mark up the MF to my understanding at 36/mo?)
total financed= 35050 + 595 + 1139.12= 36,784.12
mo paymnt= 488.83
option 2
MF=.0018 over 39/mo (allowing them to make a tad on the back end. figured they'd be more apt to accept the deal)
total financed= 36,784.12
mo payment= 475.80
the only other configuration i'm considering would be dropping to 12,000 mile program either 36 or 39/mo
thoughts/questions/comments/ideas?? anything you'd do different? please.
as always, thank you Sir Dennis!
I would find out their dealer doc or prep fee and offer them your price with that included and spelled out, or without that included for them to add back on. If the fee was $250, for example, you could offer them $200 over invoice to net out at $450 over.
I would get the price of the car nailed down first and not bother with any lease numbers now. Once you have the price nailed down, then mention that you want to lease it at that price and at the lease buy rate and see what numbers they come back with.
Dennis
Based on your numbers, a 36mo lease should run you $511. $0 due at signing. Which I think is a much better deal than $541.
any say we agree on a price, what's the comeback when they say we can't get you the MF you requested. with a 673 fico, i'm on the cusp, and with any dealer who does a decent volume, hopefully they'll request IFS to buy that rate??
this should be fun. now i see where you're going with all this stuff. hypothetically, we get the price nailed down, and they accept my MF terms etc. HOWEVER, they come back with a payment that's $30 more/mo than what i calculated. i'll be able to say.....hold the phone mr. please give me the numbers you're working with. b/c this is what i compute the "blank" and "blank" to be that amounts to "blank."
thanks again for the insight! how many cars have you leased may i ask? or did you use to be a finance manager? do tell if you will oh kind sir of infinite leasing wisdom.
Dennis
G35x /w Premium, Navi, Splash, Trunk net
36,715 carsdirect.com (including destination)
36,297 edmunds.com (including destination)
destination charge:
760 carsdirect.com
715 edmunds.com
A couple of dealers have quoted me 715 destination. Which invoice is correct? Which destination charge is correct? The difference in price is over $400 and when trying to get within $500 of invoice price that can make a big difference.
EDIT: The base MSRP prices are different too $39,725 vs $40,180 What's interesting is i have seen both MSRPs quoted from different dealers.
-S
In order to understand how this option effects your situation, you have to focus on the total cost of the lease.....and forget monthly payments. Most folks just want a low payment which is why you see all the ads with $3000 down and such...they are just playing with numbers.
This applies to anyone who is thinking of making any capital cost reduction up front....or can afford to loan $2000 or so in security deposits to Infiniti for the life of your lease. It is a way to lower the total cost...and that's what you want.
Few dealers even understand how this works....I am the only one in the past two years who took this option at my local infiniti dealer...because it's hard to explain and everyone is focused on the monthly payment which is financially wrong.(note: my dealer agrees with me, but it's too hard to explain so they don't push it).
Here's how to understand this:
Get a lease quote from your dealer with no money down at signing...just first month lease payment and taxes/title/registration....roll all other fees (dealer fees/bank fees/anything else) into the lease. Now add up your first payment plus all of the other payments to find out how much the total lease costs.
Now ask the dealer to figure out the lease with multiple security deposits...(you can do up to 7 as long as the MF doesn't drop below 0). The payments will be lower as will your first payment...but of course you have to give them the MSD dollars. Add everything up...The initial payment, the rest of the monthly payments and add in the extra security deposits.....but then you get the security deposit back at the end, so subtract out that security deposit...and now you have the total cost of the lease. The total will always be less than the first case. Now take one more step because you say, I could have had that money in a bank (or somewhere) earning interest...but I gave it to Infiniti where they don't pay me interest. OK....let's assume you put the money in the bank at today's 3% (or pick your rate)....figure out how much you will earn in the bank...that's the amount you lose in this deal....so ADD it to the total cost of the lease. Are you with me? Your total cost is what you pay nissan..plus the loss of being able to get interest in the bank on those multiple security deposits.
Finally, do the case that most dealers push.....now that you know the amount you would loan infiniti for Multiple security deposits which you get back, look at the case where you use those same $'s as a downpayment/capital cost reduction. Ah...the monthly price is much less, but now add up all the costs...this time you are adding your first payment which includes those extra capital cost reduction dollars, and then adding in the rest of the payments...you don't get any of it back.
If you did all the above right, you will see that the no money down case is the most expensive, putting some cash in up front does lower the total cost of the lease a little, but the Multiple Security Case lowers it the most.
Try it the next time you lease an Infiniti.....
One of the questions I read about in a Lexus forum was what happens if your car is stolen and not recovered? Will the insurance company payoff the remaining lease LESS the security deposit(s)? Or will Infiniti send the pay off amount due to the insurance company not including the security deposit and after Infiniti is paid, will they refund me back the security deposit(s)?
One other question, is the amount of each security deposit = to your monthly payment?
Another bonus is save in sales tax... :P
Reason being the security deposit is there to make repairs at lease-end. Since the car is totalled or stolen, there are no repairs to make. The leasing company is made whole by the insurance company. They have no cause to keep the security deposit.
You don't save any sales tax because tax is based on the purchase price or depreciation amount (depending where you live) and is therefore calculated before the cost of the money (money factor) is added in.
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
Lease car for $40K... making $4K in MSDs
One month later, car is totaled.
Insurance company values car at $35K.
IFS says payoff is $35,500... ($39,500 - $4000 security deposit)
Shortage of $500 covered by GAP insurance.
$4000 in MSDs gone.
Call your insurance agent: "We paid fair market value for the car, what you owe on it is not our concern". (no diffferent than if you had a loan)
Call GAP insurance carrier: "We cover the difference between what the insurance company pays and what IFS says you owe."
Call IFS: "Your security deposits are security to make sure we get paid. That's what we used them for."
Of course, the last statement from IFS is the sticky one... You know and I know that isn't how it is supposed to be structured, but when there are three other parties involved, the buck can be passed, indefinitely..
Now... IFS or your dealer aren't going to look for ways to keep your deposit when you turn your lease in, at end of term.. You'll owe what you owe, regardless. But, in the event of totaling your car, I wouldn't bet on getting them back. That doesn't make it right.. and this might not ever happen, but I don't think you'll find anyone at IFS that will guarantee that for you.
regards,
kyfdx
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If you live in a state that just taxes the monthly payment each month, then you'd definitely save money, if the payment is lower...
regards,
kyfdx
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He called IFS and his insurance company and reported:
Only small warning to include (I spent several hours on the phone with IFS and my insurance company to get a definitive answer) -- just as in the case with a cap reduction, if the car is totaled, the deposits are not refunded. You mention in the post "in the event of a total loss your insurance satisfies the lease bank" -- which is what I thought when I decided to investigate this option before signing my lease in 05.
I know this does not make sense (the bank is satisfied), I know it's counterintuitive, but unless you can get something in writing from IFS, I would stay away from this option or at least consider the extra risk.
So unless I had something in writing from IFS to explain how and when the MSDs would be used and not refunded *I* would not want to risk that much money.
Dennis
In answer to my own posted question above regarding the differences in edmunds.com and carsdirect.com, now that I see it I recall reading on here about it, the reason for the difference in price is a price increase.
MSRP (base) from $34,350 to $34,750 ($400)
Destination from $715 to $765 ($50)
Splash guards from $150 to $155 ($5)
400+50+5 = 455 (which equals the difference in MSRP prices I was given by 2 dealers). Which was $40,180(dealer 1) - $39,725 (dealer2) = $455
Bottom-line edmunds.com has old price and carsdirect.com has new. One of the dealers is quoting new price price, the other the old price.
Thanks -S
Another issue I was wrestling with was about how well the G35 held up over a longer time horizon. It is nearly bullet-proof over a three or four-year term. I was not so sure about how it fares over 7 or 8 years. If it held-up really well, it would make sense to buy my car at the end of the lease -- there is no way I can get this combination of power, handling, and comfort for 21k! On the other hand, I will eventually have to downsize and economize as I approach retirement -- so enjoy while I still can!:)
In any case, like you said, waiting and watching is prudent. Thanks, again.
Raj
If someone could explain what exactly I should expect to negotiate into the cost of $500 above invoice it would be greatly appreciated. Also if you can tell me what other fees I can expect to pay(ie... license, tax, etc).
thanks.
What you have to do is pick out the car you want and note the MSRP and build date. If it is a recent production car the MSRP should match what you see at carsdirect.com and the Infiniti page. If so, then the invoice shown should be correct. If the MSRP of the car you pick is less, then it is an older production car. What I would do is take the price different at MSRP and subtract if from the current invoice. That should be close enough to the actual invoice.
Dennis
Invoice = published dealer invoice for the car INCLUDING destination charge.
Dennis
I'm not saying they don't do it. It just doesn't make sense.
I'm pretty sure this came up on the bimmer board and it was said the deposits are refunded. Maybe IFS is different.
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
Any idea how much tags and title are in NJ?
Again I really can't thank you guys enough. I have what I should be paying as the base cost, an estimate of the additional fees, money factor, and residual value, so its simple calculation at this point for the monthly cost. You really do make things much easier then haggling the heck out of these guys.
Everyone on BimmerFest says you get them back... but, they are only using common sense (rare commodity in insurance circles...) I've yet to hear a real-world example from anyone over there..
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I don't know your local stuff, but a quick call to your local clerk or DMV should get the answer - or see if they have a web page showing title and tag fees. The dealers almost never mark this stuff up so you are fairly safe letting the dealer's figure them. The only thing I have seen is some dealers charge a "notary fee" or "title processing fee" which is just an additional dealer "doc" fee with another name. One out of state dealer had the nerve to stick that on my paperwork one time. I reminded them they *I* would be going to the clerk's office in my state and paying the tax and doing the title work, so no way was I going to pay them for not doing it.
The idea is to deal on price first, then plug it into a lease calc and see how it looks. Dealing from payments is a position of weakness for the lessee (you).
Dennis
Where ought I to begin?
I want to lease a G35XS with navigation, which I test drove last Saturday.
Hoffman Estates Infiniti pushed a "sweet spot" 39-month lease, 12K/yr, 1st month + plates up front, sales tax rolled into lease, and $627/month payments.
Yes, I have leased before; great business write-off. But, everytime I do this, I have to relearn all of these calculations.
Please, help me. Their numbers are WAY HIGH compared to what I see others across the country are paying for same car.
What do you think?
With IFS leases the risk only comes into play is when you have a high residual, and if by chance your vehicle is either stolen or a declared a total loss, the appraisal comes in below the actual payoff. This can happen in the early stages of the lease as the vehicle loses a lot of value immediately after you leave the lot.
There are two ways to address this issue. First you can purchase gap insurance which i believe will insure one for the difference between what one would owe on a vehicle and what an insurance company says it's worth. Second, when you buy insurance coverage you need to check with your insurance carrier if the gap coverage is built into your premium. Good insurance companies will usually provide this coverage as part of their quote, but again you need to check with them specifically on this issue. Furthermore, i'm inclined to believe that IFS itself should provide this gap coverage on every lease or finance deal as they are exposed to this same deficit in capital if in fact one of their vehicles is involved in a collision where the car is totalled or stolen.
I also don't believe that because you don't have a deposit in place you are less exposed to the same risk. Whether IFS has a deposit or not, if they are owed money they will come after your via legal avenues. So if you leased a car and your car is stolen 3 days later, why do you believe the person that doesn't have a deposit is any less responsible for the full value of the vehicle as the one who does?
Just my 2 cents.
The example your brought up about ownership vs. rental is only half accurate. If you rent an apartment and paid $1,000 per month for the apartment and initially you had put up 2 security rent deposits to the landlord and then your apartment burns down would you also lose your security deposit? I don't believe so, because as long as you paid the rent timely, your deposit should be refunded if the apatment is not livable in and the landlord asks you to vacate.
I agree with you - that is the way MSDs should work, but someone posted that they spent hours on the phone with IFS and was not it did not work that way, so they passed on an MSD lease.
As I said before, if you can't get something in writing from IFS about how the MSDs are used, kept, and refunded I would not recommend that anyone do an MSD lease.
Dennis
Lease car for $40K... making $4K in MSDs
One month later, car is totaled.
Insurance company values car at $35K.
IFS says payoff is $35,500... ($39,500 - $4000 security deposit)
IFS's payoff is not 35,500, it is 40,000 minus your first month payment.
Shortage of $500 covered by GAP insurance.
The purpose of GAP insurance is to cover the difference between the value of the vehicle and the payoff amount. $500 is an arbitrary number and is not an actual number, so i'm not sure where you received this information from. Insurance companies are regulated by the Department of Insurance, they can not reneg on a policy unless you are in violation of policy rules.
$4000 in MSDs gone.
Again, assumption.
Call your insurance agent: "We paid fair market value for the car, what you owe on it is not our concern". (no diffferent than if you had a loan)
This is true. They have to do an actual appraisal report. But they also have to keep you as a customer. They do their best to come up to the most reasonable fair market value with comparables.
Call GAP insurance carrier: "We cover the difference between what the insurance company pays and what IFS says you owe."
What you owe is the payoff amount, this doesnt involve the security deposit. If you put 10k in the bank and the bank burns down, does the bank give you a call and say sorry your money burned down and you no longer have any balances here? IFS like any other bank is regulated by the Banking authorities. They can't just take your money because they feel like it, what you are suggesting is flat out fraud as it is unsubstaniated by facts.
Call IFS: "Your security deposits are security to make sure we get paid. That's what we used them for."
No, what they use them for is to ensure that you don't bring the car back in horrible shape and do not pay them for the repairs. And it is also to give them assurance that in the event that you default on your loan, they have some added security that they won't lose as much on the vehicle.
But lets compare an alternative scenario.
You buy a car, you put up $2000 for upfront fees which involves first month payment, acquisition fee, motor vehicle fees, doc fees, etc. Car has a price tag of 40k and a payoff amount of 39,500. You crash into a tree the day after your picked it up off the lot. Now your insurance company pays off $35,000. IFS says hey brother, you still owe us $4,500 and if you don't pay us within 5 business days we take you to court. You wind up not paying and they put a lien on your house, your boat, your wife and your kids. Then they file a summons at the local court house and you find yourself scrambling to find an attorney that charges $1,500 just to show up to court. After you show up to court, the judge postpones the hearing because she had the runs from the chinese dinner she had the night before. So now the hearing is rescheduled for 2 months. The lawyer now wants another $500 to show up because time is money. So you make an appearance in front of the judge and the judge says why are we here today? IFS attorney says Mr. HOSTMAN owes us $4,500 for his lease. Judge says does defense have anything to add? So the rinky dink attorney you hired says no 'mam i think we are all clear here. So the judge rules in plaintiffs favor and you wind up paying $4500 back to IFS.
So lets analyze this scenario. You put up $2k in initial cost that you lost. You paid $2k to the attorney who showed up in his fancy suit and did nothing, and you are now out another $4500 to IFS because in all fairness you still owe them their money. So you are out the same $4k that you would have in Multiple Security Deposits except you now lost countless hours of sleep, exhausted your vacation and sick days at work and you still dont have a car.
My point is simple, just because you don't have a secrurity deposit in place doesn't mean you cant be sued or are off the hook for what you owe.
Just when you thought you knew everything about insurance — along comes gap insurance.
Though it may sound trivial, gap insurance is a must for leasing. And if you made a small down payment when buying a car, a gap policy can be lifesaver as well. But first, let's look at why it exists.
As the name implies, gap insurance covers what traditional auto insurance doesn't. In other words, it closes the gap between what your insurance company pays if your car is stolen or totaled and what you owe the finance company.
Let's take a test case. Say you bought your car two months ago for $25,000. You begin making payments at about $500 a month based on a 6 percent interest rate. Then, disaster strikes: a tree falls on your car and flattens it.
You call the insurance company and it looks into its crystal ball and decides at the time of the accident your car was worth only $20,000. The car may only be a couple of months old, but it has already lost 20 percent of its value. Unfortunately, the finance company still wants the full amount you owe them. With interest, tax and license fees, they figure that to be $27,000.
Yikes! There's a gap of $7,000 between the $20,000 that the insurance company is willing to pay you and the $27,000 the finance company is demanding. Most folks are going to be eating Spam dinners for the next two years, but if you have gap insurance you can safely order steak.
Apply the same scenario to someone who bought their car. If they left the dealer lot without putting several thousand dollars down, they likely owe more than the insurance company will pay if the vehicle gets totaled or stolen in the first few years. Once again, gap coverage can save the day.
And that's why gap insurance is a must for many drivers. In fact, gap insurance is usually mandated by lease contracts or included within them. If a gap policy is required but not included in your contract, you should shop around for this coverage (insurance companies sell it). If gap coverage is included in the lease, check to see how much is offered and how much you're going to be paying for it. (In some cases, lease contracts may include what is known as a gap waiver, which protects you from gap charges in the event that the leased vehicle is declared a total loss — eliminating the need for a gap policy.)
Is gap insurance necessary for people who finance their cars? Well, it depends on your coverage. If your regular insurance policy is written to pay off the fully financed amount, then you don't need gap insurance.
A few things to keep in mind when buying gap insurance:
Although most people purchase it when a lease is initiated, some insurance companies will sell you a gap policy anytime during the lease term.
You must be in compliance with all terms of the lease.
Your gap insurance policy may not be honored if you don't have collision and comprehensive insurance coverage. Further, lease contracts generally require that you carry collision and comprehensive at all times.
If your car is totaled, or stolen, carefully follow all requirements made by your insurance company. For example, some companies require you to continue making loan payments on your totaled car until the money from the gap insurance is paid out.
So when initiating a car loan or lease, always remember to ask your insurance agent or loan officer about gap insurance. If you have an accident you'll be glad you planned ahead.