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Volvo XC70 Lease Questions

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Comments

  • meshugymeshugy Member Posts: 24
    You might also consider just getting a car with the three packages: Premium, convenience, and Climate. That's what I got (plus sirius wiring,Air quality, and Metallic paint) and the MSRP was $43,150. These packages have everything the Adventure does, plus:

    Booster seats
    Grocery Bag Holder
    Wood inlays
    Sunglass holder

    If you don't care about the booster seats then the Adventure package is probably better. Also, the Advneture has a 6 CD changer...if you want that. Most people are using ipods, so my guess is they're trying to get rid of some extra changers. But all in all, it doesn't seem to be any big savings. Looks like it's more of a marketing move...my guess is they ran out of the booster seats (the 2008s have newly designed ones), but they still wanted to offer some of the other convenience package options, hence the "Adventure Package."
  • psychwarlordpsychwarlord Member Posts: 2
    Hello all

    We are looking to lease a 2007 XC70 w/climate/convenience/premium and bi-xenon lights

    The dealer told us about the $3,000 lease incentive w/Volvo finance but did not mention any $9,000 incentive with a bank.

    He offered for 15,000 miles/year for 36 month lease

    Price: 34,000
    Residual: 17,635
    Money factor: .0027
    $599/month for 35 months with no money down
    $405/month with $6,000 trade-in and no money down
    $350/month with $6,000 trade-in and $1440 down

    My concern: I am seeing cap costs of 29,000 here on the forum, but residuals of like 20,000.

    I like our residual, and the price is a fair one: I don't need to gouge

    But should I look into the $9,000 lease incentive through a private bank? IS this something I need to ask the Volvo dealer or should I just call a bank to find out?

    Thanks - I have never leased before
  • fargodogfargodog Member Posts: 13
    Meshguy,

    Spoke with dealer today who has 6 Adventure package models on his lot and he said they do include the booster seats. I have not seen the cars in person and was wondering if you have seen the Adventure model in person. Booster seats are key factor for me and don't want to drive 40 minutes to hear "oh, I meant the other models" or some other snow job from salesperson.
    thanks
  • jag_drivejag_drive Member Posts: 8
    fargodog - I have seen at the dealer lots "Adventure Packages" both with and without Booster seats, so I hope the salesperson is not literally taking you for a rds.
  • jag_drivejag_drive Member Posts: 8
    The current offer for an Xc70 from a 3rd party bank is actually $10,000. Given the package you are looking at, I ran rough calculation using lease #'s I have seen(assumes metallic paint):
    MSRP 43,500
    Invoice 40,500
    Residual 42% (US Bank #'s)
    Money Factor .00217 (US Bank as of last week)
    Term 36 months

    THis gives you a residual of $18,720.
    Monthly payments are $457.75 before tax. This assumes you get the car at invoice, and you might want to assume a few hundred dollars over invoice. If you throw in all the upfront costs (about $1700 including 1st month payment) and dealer profit of about $500...the monthly payment is $525 before taxes.
  • psychwarlordpsychwarlord Member Posts: 2
    Thank you for your help - I talked to the sales manager today and the cap cost is 34,000, with the $3,000 "cash down" from Volvo, the result is $31,000 cap cost. The esidual w/15000 miles per year is around $17,635. The money factor here is .0027

    Thanks again - it looks like a pretty good deal to me.
  • briandcbriandc Member Posts: 15
    Thoughts on where these guys can improve? Thanks!

    Volvo Lease Program - which I need to do because it helps tremendously with my local jurisdiction Personal Property Tax

    MSRP: $38,915.00
    Sell Price: $36,821
    Bank Fee $595
    Title: $195
    Rebate: $2,400
    Sale Price: $35,211

    Residual: 59%
    Purchase option: $23,459.85
    Miles: 10,500/YR
    Factor: .63%
    24 Mos
    Base Payment: 547.11
    7% taxe: 41.70
    Total Payment: $588.81

    $650.00 due at signing which is the sec deposit.

    I would look at a 36 month if I can get the payments lower.
  • parklifeparklife Member Posts: 5
    Does anyone have the money factor that VFNA is offering for a 12k mi/36 month lease on an XC70? Thanks.
  • rrhserrhse Member Posts: 4
    I think I'm being screwed around by my dealer - had what I thought was a good deal arranged on an XC70 with Adventure, using VFNA 24 mos / 24K miles. .00001 money factor and 61% residual, decent cap cost. Dealer then back tracked and said that VFNA had dropped the residual to 55%.
    Anybody out there (Car Man?) know what the terms of the current VFNA 24/24 lease would be? I believe that there is a change scheduled for 7/9.

    Thanks for any help.

    John
  • blckislandguyblckislandguy Member Posts: 1,150
    My wife and I are toying with the idea of replacing her '01 XC. By personality (we don't trade cars, we keep 'em), geography (New England), and training (one of has a Ph.D. in Econ), leasing makes no sense to us. (Whenever I see a guy in a -presumably leased- MB S550, I think, "there goes a guy head over heels in debt who is all flash, no cash").

    But. is this one of the few times where it does? Even if you add back in the not so hidden "bank fee", "application fee", etc. it looks like you are getting at least a discount of $8700 from Volvo. Apparently, the best Volvo purshase incentive is 4k. Now, I know that most people turn a car in with more miles on it than the lease agreement and pay thru the nose for excessive mileage, etc. But it seems that right now Volvo has stacked the deck in favor of leasing AND in three years, the new style V70s will have been tested and ready to purchase.

    We hate the idea of leasing. Enlighten us. Or, are we just preaching to the choir?
  • meshugymeshugy Member Posts: 24
    Hi....yes, I do believe it is a far better deal to lease and then buy the car after the lease. Right now Volvo is offering $9K incentives to lease, and as you mentioned, only about $4k to buy. I just leased a 2007 XC70 with a cap cost of $30K which incredibly cheap for a loaded model (MSRP $43K).

    Good luck!

    -Michael
  • aephemeaepheme Member Posts: 48
    I think the "idea" of leasing is actually far worse than the reality of it. It's taken me a while to convert, but IF* you want a new car, leasing seems to be the rational economic decision (in some cases). I can't speak for this specific deal, but some things to keep in mind:

    1. Your rate of interest (converted to a "money factor" in lease terms) is often significantly lower than straight-out purchase financing. (And unless your investments are making less than 6.5%, the average finance cost, you should ALWAYS finance).

    2. The residual value is often overestimated... that is, if you went to sell your newly purchased car in 2/3/4 years, it wouldn't be worth as much as Volvo is optimistically hoping it will be.

    3. By agreeing on a residual value up front, you remove ALL RISK associated with depreciation. This is HUGE! Gas prices shoot up to $20/gal, or new technology comes out and your car is suddenly worthless. Who cares? The financing company eats the loss.

    4. Even better, you always have the option to purchase. If the market goes the other way (and your residual is worth more than they thought), you have the option to buy at a predetermined price! You have all the potential upside and none of the downside.

    Really, though, if you have some economics / finance background, just price both options out (including when you think you'll finally sell a purchased version) and do a simple NPV. Go with the option that costs less. If you really wanted to get sophisticated, you could use Black-Scholes to calculate the value of the purchase optionality. :)

    Anyway, some thoughts...

    Aepheme

    * [Of course, if you don't want a new car, then purchasing a used vehicle will always be less expensive than either buying new or leasing new... but then you're also taking on a large amount of repair risk (could cost time and money), you're sacrificing the newest safety features (how much is your life worth?), and you're driving something that's probably less luxurious.]
  • blckislandguyblckislandguy Member Posts: 1,150
    Geez, Black-Scholes no less. The last time I saw Mryon he and his wife were photographed in the NYT walking out of a court house were they had testified maybe Re: Long Term Capital's blow up. They were not a happy couple. I think they were being sued.

    Just for kicks, what if a grad student were to work on and publish an Black Scholes do it yourself kit for potential leasees? Give me a clue, how would the kit start?

    More to the point, sure leasing looks attractive IFF you are the kind of consumer who is has to be in a not-more-than-three year old car. To my way of thinking, the sweet spot is something between two to 8 years old. Like our impeccably well maintained '01 XC that now is just printing money for us.

    Moreover, I think that the acquisiton, application, and disposition costs associate with leasing easily can total $1300. We won't even mention excess mileage and "wear and tear" charges.
  • meshugymeshugy Member Posts: 24
    Of course, if you don't want a new car, then purchasing a used vehicle will always be less expensive than either buying new or leasing new.

    Actually...leasing is so cheap right now, used cars are even more expensive! A used 2006 or 2005 XC70 with similar features and low miles is in the $30-$35K range. We got a brand new leased one for $30K!

    I know this is not normal....but Volvo is offering such big incentives right now it's hard to find anything better then leasing.

    I've never leased before and always thought it was ridiculous. But in this particular situation, the smart $ is on leasing.
  • fargodogfargodog Member Posts: 13
    Hello,

    Does anyone have the new numbers for July? I am looking at a 36 month lease, 25,000 miles per year. The dealer told me today that the residual went down about 2%. Thanks

    Dennis
  • blckislandguyblckislandguy Member Posts: 1,150
    Hey meshguy, your are a good guy, but exaggeration diminishes the force of your argument. An argument that probably is by and large correct.

    For example,

    1) Pricing. How did you get to 30K on a new leased XC70? The max discount is 10K PLUS lots of fees. Could we agree that your total cost to acquire (and eventually dispose of it) was closer to MSRP (probably 42K with climate/convenience/premium) less the 10K Volvo discount PLUS say $1500 in lease fees? This totals $33,500.

    2) In my Northeastern zip code, there are tonite on cars.com perhaps 15 or 20 very low mileage '07 XC all with climate/convenience/premium for roughly 34-35K ASKING. If one speaks nice to them on the very last business day of the month, you will go home in one for 32K or less. And it will be yours. With no mileage charges. Without any high residual so you can't get out of the three year lease cycle. And if you speak real nice real late at night on that last business day of July, maybe you can get it Volvo certified out to 100K miles. That if you are still with me, is a better warranty than on a new unit.
  • meshugymeshugy Member Posts: 24
    Hi....I'm not here to pull the wool over any ones eyes. My Cap cost was $30,472.96. If you really want I'll scan it and send it to you.

    I can't speak for the NE. I just checked Autotrader for Seattle. Only one recent used XC70 under $30K...was a bare bones one with 26K miles for $26. I got A new XC70 totally loaded with free 3 years of matinence, cross bars, a full 4 years of warranty for $30K. See why leasing was a better choice?
  • babycarbabycar Member Posts: 9
    Hi,

    I can't speak for other deals, but this is the deal that I just got for a XC70 with Adventure package on June 25th in the Boston area.

    Purchase Price = $29,670
    Residual = $20,320
    36 months
    12,000 miles
    $438 per month (includes tax)
    only 1st month payment ($438) due at signing

    The 1st payment of $438, everything else is included, all tax, title and registration fees.

    I originally started looking at a certified pre-owned, but when I do the math the car is going to cost me $36,088 if I choose to purchase at the end of the lease. This is about 6 or 7 grand more than I would have paid for a 2006 used XC70, but I was going to put down about $15,000 if I purchased a car, this way my money stays in my investment portfolio for the next 3 years, making money for me.

    Not to mention the obvious advanatage that if we want a new car in 3 years we can have that option as well, but we are planning on buying the car at the end of the lease.
  • fargodogfargodog Member Posts: 13
    Hi Babycar,

    Are you sure about the 29670? What was the MSRP on it? Which dealer did you get this from? I live in MA as well and just had a terrible experience today with Lee Volvo. Thanks

    Dennis
  • hedgshedgs Member Posts: 3
    - 2007 XC70, Black, with Climate Pkg & Premium Pkg
    - $40,785 list, $8,500 discount
    - 7.75% sales tax (Cook County, Illinois)
    - $3,500 out of pocket (mostly tax)
    - $444 per month, 24-month term

    We have not really begun to negotiate. I'm thinking that they can come down a bit more price-wise, perhaps $1,000 - $1,500 based on no negotiation yet. Anyone have advice?
  • meshugymeshugy Member Posts: 24
    They most likely can come down a lot in price. I got a MSRP $43K car leased for $30K. A $13K discount from MSRP.

    The same dealer is advertising $12K off right now:

    http://www.bobbyersvolvo.com/AdWizardAd/5669984

    I'd also get them to drop the $3,500 down. I only paid $740, and most of that was my first months payment.

    Good luck!

    -Michael
  • babycarbabycar Member Posts: 9
    yes, I'm positive about the price. We got it at South Shore Volvo
  • fargodogfargodog Member Posts: 13
    sweet deal, thanks for the info
  • hedgshedgs Member Posts: 3
    Thanks, Michael
  • chawk01chawk01 Member Posts: 13
    Car_man (Host) or anyone else in the know -

    I'm in Nashville, so I'm curious as to the current Southeast XC70 lease incentives. Did they change after July 9th (the end of the previous lease program) - better/worse?

    From reading this forum I'm looking to strike a deal with one (of the 2) Volvo dealerships in town and would hope to get something like this:

    2007 XC70 - Adventure Package (or equivalent climate/convenience/premium together in one vehicle)

    MSRP - $42-$43K (Adventure MSRP probably lower)
    Cap Cost - about $30K-$31K (bank incentive and dealer discount)
    Length - I'm open to 24 or 36 months
    Residual - $17K-$18K range (assuming 36-month lease) / Anyone know residual on a 24 month lease?
    Cash Upfront - 1st month payment + maybe a small fee (no more than $750 out of pocket total)
    Payment - $425-$450 range (including tax)

    If the posts on here are legit, I feel like these numbers are achievable. I'd appreciate any insight anyone has on late July lease experience or thoughts of what they may be as we turn to August.

    Thanks. Looking forward to joining the Volvo family. I've been a longtime Swedish fan (had many Saabs) - these XC's look like a lot of fun and I've got a brand new baby on the way to protect.
  • jaa37jaa37jaa37jaa37 Member Posts: 30
    Looking for a 24-month lease, 12,000 miles a year. Any idea what the money factor and residual would be on an XC70 with Premium package, climate package ($40,000 or so MSRP)? Thanks!
  • jaa37jaa37jaa37jaa37 Member Posts: 30
    Which dealership was this?
  • chawk01chawk01 Member Posts: 13
    What residual % have people been getting on a 36-month lease via 3rd party banks?

    I've got several of the variables lined up, but the residual is killing my payment.
    36-month lease
    MSRP - $42,090 (Adventure Pkg)
    Adj Cap Cost - 30,740
    money factor - .00275 (high, but a trade off for the cap cost reduction)
    Residual - 40% = 16,836 (seems WAY low) Shouldn't I expect 47% range
    Upfront - $700 (incld 1st payment & minimal fees)
    Payment - $595 (incld tax)

    The residual is dragging the whole deal down. Did it just recently plummet or what? Anyone with recent (last couple weeks) experience, please respond.

    Thanks.
  • jaa37jaa37jaa37jaa37 Member Posts: 30
    XC70, climate, convenience, premium packages. The cap cost is higher than I've seen here, because I want a 24-month lease -- according to the dealers I've spoken with, there's a $5,000 incentive for third-party banks, but since Volvo Finance is the only option for such a short lease, I can't get that incentive.

    MSRP: $42,855
    Sale price: $34,899
    Volvo Finance loyalty bonus: -$1,000
    Term: 24 months
    Mileage: 12K
    Monthly payment, not including taxes: $427.56
    Taxes paid up front, including bank fee and bonus tax: $992.98
    Doc fee: $45
    Inspection and tire fee: $22.50
    Total due at signing, including first payment: $2,083
    Money factor: .00026
    Residual: 56 percent, or $23,998
  • CarMan@EdmundsCarMan@Edmunds Member Posts: 38,514
    Here's the info that you're looking for, parklife. Volvo Finance's current buy rate lease money factor and residual value for a 36 month lease of a 2007 XC70 with 12,000 miles per year are .00150 and 46%, respectively. When negotiating your lease on this model, make sure to take the $5,500 lease cash that is available on it into account. There is an additional $5,000 cash incentive, $10,500 total, for consumers who lease through independent banks.

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • CarMan@EdmundsCarMan@Edmunds Member Posts: 38,514
    Hi John. Volvo Finance's current buy rate lease money factor and residual value for a 24 month lease of a 2007 Volvo XC70 Adventure with 12,000 miles per year are .00026 and 56%, respectively. Volvo is currently providing a $4,500 cash incentive on leases of '07 XC70 Adventure models through Volvo Finance.

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • CarMan@EdmundsCarMan@Edmunds Member Posts: 38,514
    Hello Dennis . Wow, 25,000 miles per year. That's a lot of driving. The highest mileage allowance that Volvo Finance publishes residual values for it 19,500 miles per year. If you need to drive more than this, you will have to purchase additional miles on a per-mile basis. It is less expensive to do so at lease signing than it is to wait until the scheduled end of your deal and have to pay an excess mileage penalty. According to the latest information that I have seen, Volvo Finance's current buy rate lease money factor and residual value for a 36 month lease of a 2007 Volvo XC70 with 19,500 miles per year are .00150 and 41%, respectively.

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • CarMan@EdmundsCarMan@Edmunds Member Posts: 38,514
    Congratulations on your new XC70, babycar. Make sure to stop by the new Edmunds.com Dealer Ratings & Reviews section to share your thoughts on the dealer that you get your vehicle from with everyone. Enjoy your new ride!

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • CarMan@EdmundsCarMan@Edmunds Member Posts: 38,514
    Hi hedgs. The XC70 that you are interested in has a spread of around $2,500 between its full MSRP and its dealer invoice price plus Volvo is currently providing a $5,500 cash incentive on leases of it through Volvo Finance. That gives you a total of around $8,000 to play with, so an $8,500 discount looks very good to me if your lease is being run through Volvo Finance. There is an additional $5,000 cash incentive for leases through independent banks, so if this deal is being run through a bank other than Volvo Finance, you should be able to do better.

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • CarMan@EdmundsCarMan@Edmunds Member Posts: 38,514
    Greetings chawk01. The XC70 that you described has a spread of just under $3,000 between its MSRP and its dealer invoice price. In addition to this spread, there is a total of $10,500 in cash incentives on non-Adventure and $9,500 on Adventure models. If you are talking about a non-Adventure model and you are in an area that has a decent level of competition, there is a very good chance that you will be able to do better than a $12,000 discount, which would be equivalent to around $1,500 over invoice.

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • CarMan@EdmundsCarMan@Edmunds Member Posts: 38,514
    Hi jaa37jaa37. According to the latest information that I have seen, Volvo Finance's current buy rate lease money factor and residual value for a 24 month lease of a 2007 Volvo XC70 with 12,000 miles per year should be .00026 and 56%, respectively. When negotiating your lease on this vehicle, make sure to take advantage of the $5,500 cash incentive that Volvo is providing on Volvo Finance leases of non-Adventure models.

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • thepassengerthepassenger Member Posts: 10
    Hello Carman

    Great info-thanks. Can anyone think of a reason why Volvo would offer an additional $5000 out of its pocket to let an independant bank make money on the financing? It would make sense to me if Volvo were making something back on the finance charge but they are giving it away. The reason I ask is that I think we all agree we like the terms of Volvo financing but that additional 5k off is only if we go to another bank. Why should Volvo care?? Give us the additional 5k AND make some interest back vs. 5k AND lose interest money to another bank. What am I missing???

    Thanks
  • stanman4stanman4 Member Posts: 8
    Can someone help me figure out a lease payment. I am looking at a 2007 Chevy Tahoe LTZ. MSRP $49,305; Invoice $44,116. Rebate of $2000.00. Marketing support to dealer of $3000.00( I don't know if this is a benefit to me or not).

    I am looking at either at 36 or 48 month lease with 15K per year in miles.

    Zero down payment.

    Thanks
  • CarMan@EdmundsCarMan@Edmunds Member Posts: 38,514
    Hi thepassenger. First and foremost, Volvo is in the business of selling vehicles. It doesn't really care if it sells them by leasing them through Volvo Finance or through an independent bank. It might actually be less expensive for Volvo to pay $5,000 all at one time and be done with a vehicle than to have to pay for a low interest rate on a lease of it and have to worry about its residual value exposure. Ford's cost of money is higher much than the 3.6% interest rate that it is charging on leases of the XC70, so it wouldn't be making any money back in interest by leasing this vehicle.

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • CarMan@EdmundsCarMan@Edmunds Member Posts: 38,514
    Greetings stanman4. This discussion is for consumers to talk about leasing the Volvo XC70. Please stop by the "Chevrolet Tahoe: Lease Questions" discussion for the answer to your question about leasing a Chevrolet Tahoe.

    Car_man
    Host
    Prices Paid: Buying & Leasing Experiences Forum
  • thepassengerthepassenger Member Posts: 10
    Thanks Carman, that makes a lot of sense. No wonder the independent banks quote such a low residual. I went to 4 banks in my area (including Bank of America, my bank) to get info on lease rates so I could walk into the dealership as a 'cash buyer' so to speak. None of them offered this. Is lease financing like mortgages where you are required to go through the dealer who gets it from a wholesale market? Purchase financing is no problem, albeit expensive.

    I live in a very competative area so I'm hoping I can get a good bank deal.

    Thanks
  • maxdadmaxdad Member Posts: 10
    Hi Car_man. Sorry to jump on the pile, but my curiosity has gotten the better of me. I would like to ask you if the deal that my wife and I are getting today is really as good as we think. We are picking up a new XC70 Adventure Package lease for 24 months at $417/month with 25,958 residual and 12K miles/year allowance. $1080 due at sign includes taxes, registration, and first month's payment. Any input is appreciated.
  • thepassengerthepassenger Member Posts: 10
    From what I've seen here in this forum that is a great deal. Where are you located? Is that financed through Volvo or 3rd party bank? If your planning on buying out the car at the end of the lease that residual may be high but if your a chronic leaser as I am then I would jump on it.

    Ed
  • thepassengerthepassenger Member Posts: 10
    Actually, that residual is for 2 years so maybe not so high. $417 sounds great for 2 years.
  • maxdadmaxdad Member Posts: 10
    Good, we just picked it up a little while ago. We are located in Wisconsin. This deal was in Milwaukee. The lease was through Volvo.

    My thought was the residual may be a little high...but if it's not worth that in 2009 then we will turn it in and start over.
  • mnsqrdmnsqrd Member Posts: 1
    I would like to talk to you as we live in Wisconsin too. I'm currently at the end of my second three year lease on an XC70. Who was the dealer? Thanks.

    MN
  • hedgshedgs Member Posts: 3
    Yes, this seems like a good deal; better than the one I just got: 24 mos, 10,500 miles year, with climate and premium(?,can't remember) package, $455/mo, with taxes, registration and 1st payment down. They would go no further, so somewhat satisfied from that perspective.

    Dean
  • maxdadmaxdad Member Posts: 10
    Sure, I'll try to answer anything I can. This deal was at Jenkins Volvo in Milwaukee. I started out looking for a 3 year lease at $438/mo $438 due@sign and $20,320 residual and they quoted me this instead.
  • maxdadmaxdad Member Posts: 10
    Dean, do you mind if I ask your residual? I think mine seems a little high.
  • mwb2mwb2 Member Posts: 1
    Hi all -

    I am planning to lease (for the first time) a 2007 Volvo XC70 (Adventure Package, MRSP: $42000).

    Just got a quote from a local dealer (in Northern Virginia) for a 3yr/12k lease that seems too high to me:

    MRSP: $42,070
    Sale price: $30,650
    Money factor: 0.00215
    Residual value: $16,415

    The quoted monthly lease payment is $565 (and seems to include sales tax and various fees).

    The sale price seems ok to me, but after reading previous message on this board, it seems to me that the residual value is too low and the money factor too high.

    Am I wrong? Any idea what numbers (money factor, residual value) I should be expecting at this point?

    Many thanks for your help,

    MWB
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