General Questions about Leasing Vehicles

scottinky · October 2007

looking to lease a CPO 04 A4 Quattro. WE are adding some neg equity to this deal.
Here it is:

Car is $26K
$2500 down
neg equity is $11,500
trade $4600
residual $10,340
money factor .00060 through Audi
48months at $499 all taxes

we are trading a 1995 C220 with 64K. Not sure if I want to pull the trigger
on this, but I dont like having two cars out of warranty. Oh, the A4
has 6/100K warranty and 25K left of Audi care maintenance. this lease rate
from Audi expires tomorrow, although if it is a bad deal, I don't care to let it go.
our car is in (knock on wood) ex. mechanical shape.

bodble2 · October 2007

Thanks! I'll enquire about local laws. (Some people will probably wonder why do a single payment lease? Shouldn't I just buy instead? But I guess that's for another discussion!

)

volvomax · October 2007

I'm not a big fan of the 1 pay.
It really doesn't give you any advantages over a traditional lease.
It just ties up capital.

bodble2 · October 2007

Yeah, I agree. The one advantage would be lower lease rates. And if I can net out the sales tax on a trade, then that would be a big plus.

volvomax · October 2007

Lower lease rates with who?
Most banks don't do them.
The captives do, but the rate break is very small.

Esp if the rate is subvented already.

bodble2 · October 2007

BMW for one. Their lease rate will drop for a 1 payment.

reufim · November 2007

I have a leased x3 2005 with 23,000 miles that I can buy from the dealer at about $22,000 with tax included (about $25 per month for 5 year loan). Also, BMW is offering a lease of an x3 2008 new for $399 per month for 3 years.

I would appreciate anyone's thoughts on whether I should buy my current leased car or get into a new lease as stated above.

Thanks.

kyfdx · November 2007

That 2008 model X3 will end up being a lot more than $399/mo.. By the time you add options, you'll be around $500/mo., with probably $4000 upfront.

$22K is dirt cheap for your 2005 model.. I assume it has few options? Will the dealer add the CPO warranty for that price?

reufim · November 2007

They have a special deal now for $399 per month for the basic model (automatic transmission) with only $1,500 down. My current x3 is an automatic, with the double sunroof, and that's it.

So in essence, by the end of the 3 years, if I lease I would end up paying about the same as if I bought. The difference is that if I buy I would have two more years of payment, and the car would be 6 years old with about 50,000 miles. Also, by the end of 2008, if I buy, I would be without a warranty at that point.

I haven't checked if the dealer would add the CPO warranty for that price. Actually, I would be buying it from BMW financial and not the dealer.

Curious about your thoughts knowing all this now.

Thanks.

kyfdx · November 2007

Well.. the best deal that I see on their website is $450/mo, with $3400 due at signing.. Not that you can't beat that deal with a motivated dealer, but I'm guessing that the final price will be a good bit higher than $399.

But, never mind that...

Given how few miles you drive (8K/yr?), I think buying your current vehicle would be a better deal. I rarely say that about X3s, because they do have good lease deals, but your buyout price is nice and low.

RE: CPO..

BMWFS can sell you the 6yr/100K warranty that is exactly the same as the CPO warranty.. I'm guessing that it will be around $2300-$2700.. That will kick in, once your original warranty expires, in another year.. Given your low mileage use, that is pretty stiff for just two years of warranty. Plus, that won't extend the included maintenance plan (that would be another $1200-$1500). I'd go without the extended warranty or maintenance, in this case.

Alternatively, contact your dealer... Tell them you are interested in buying out your lease, but you want the vehicle to be CPOed. Ask them if they can beat the BMWFS price for residual + CPO warranty. Tell them the difference needs to be substantial. BMWFS sells cars to the dealer for the wholesale MMR price, which may be more or less than your residual. If it turns out to be less than the residual, then your dealer may be able to buy your car, CPO it, and sell it back to you, for less than what it would cost to buy it from BMWFS with the added warranty.

Here is a link to a relevant post of someone that did just that.

Good luck... feel free to ask any more questions.

regards,
kyfdx
visiting host

reufim · November 2007

Thanks so much for this info.

I will think about this more tonight when I get home from work and perhaps reply with more reflections. For now, thanks so much.

bodble2 · November 2007

With the improvements made to the post-2006 X3, I would lean toward leasing the '08.

jaxs1 · November 2007

It looks like I should be able to lease a 2008 Honda Accord EX-L 4 AT with Navi or EX-L V6 without navi for 3 years/45K miles/$0 cap reduction for around $400 per month based on about $27K selling price, the 62% residual and .00270 standard money factor in California. There are no special discount lease deals on the Honda Accord right now.

I am not dead set on getting a Honda Accord if I can get something nicer for about the same lease cost.
I thought that since there are no subsidized leases on the Accord leases and there are subsidies available on other cars, maybe I could get a more prestigious vehicle for about the same amount of money.
Maybe an X-Type, TL, 328, Saab,'07 C-Class, Lexus IS250, Volvo, '07 CTS, Infiniti G, etc., etc.?

Are there any super hot lease deals available in California on near-luxury vehicles that would be available for close the same price as this Accord deal (due to dealer discounting, incentive cash, cheap money factors and inflated residuals etc.)?

reufim · November 2007

what are the improvements on the post-2006 x3?

kyfdx · November 2007

It's a little smaller, but you should be able to get an Acura TSX for $400/mo. inclusive..

Out of the others on your list, I'd say only the Saab has a chance of coming in at $400... Maybe a Volvo S40 (again, a smaller car).

jaxs1 · November 2007

Smaller will be OK. Maybe I will look at the TSX and Saabs.
I remember there was a really cheap lease deal on the old style Infiniti M sedan before the redesigned model came out a couple years ago. I think they must have had over $10,000 in incentives on it to subsidize the cost of the lease.
I was hoping a deal like that might happen again for some other similar vehicle.

bodble2 · November 2007

Refreshed styling, ungraded interior, new engine, transmission.

hondaodd1 · November 2007

hi everyone, well i have read lots of post about leasing.
but i can't seem to find my answer???(maybe i didnt read enough) so i hope you guys can help me. i want to lease a 07 or 08 Odyssey for 36 mons. i have a 2000 honda accord to trade in. i don't mind about owning the car or not and i want new car every 3 years too. so here are my questions.

1. how do i negotiate to the Invoice price? (detail please)
2. when i get the agreed pirice, can i change it to a lease other then buying it? can the saleman say NO?
3. even the Ad said i have to put xxx amount of $$ down, do i have the option to not to? how?
4. i really want to trade in my car, but dont want to take the risk of losing the money if the car got wrecked, what can i do? beside selling it myself?
5. does the residual price matters to me, even i am not going to buy the car?
6. when i return the car, do i have to do anything?

i am really new to this lease thing, please give me your advice, much much appreciated
thank you. hondaodd

hondaodd1 · November 2007

one more thing..do i get the Lease Van at the spot or i have to wait?

tidester · November 2007

While you're waiting for a reply here you should have a look at 10 Steps to Leasing a New Car and Car leasing advice at Edmunds .

tidester, host
SUVs and Smart Shopper

volvomax · November 2007

1 some cars can be bought for invoice,some can't.
Check on the Honda pages and see what kinds of pricing is available.
2 If there is an incentive or rebate in the price, the price may change if you lease. Otherwise, you can pay for the car any way you like.
3 You can out down as much or as little as you like. Of course, it will affect the lease payment.
4 I don't understand, is your trade in wrecked? Generally, there is no incentive to trade a vehicle in on a lease. Sell it yourself.
5 If you aren't going to buy the car, the residual doesn't matter to you. In fact, the higher the residual, the lower the payment.
6 Most lenders have a return fee. Also, most have pre-term inspections. Which are a very good idea.
You will be penalized for excess miles, and excess wear.

allisonh · November 2007

I'm on my way in 10 minutes to lease a 2007 Lincoln MKX base for 39 months $1000 down, payments $404 month, includes tax. The Lincoln dealer will NOT take my Toyota Highlander Limited as a trade, even though I paid off my last payment on my lease. My or Dealer purchase priceis $12,113. Carmax will give me $12,500. Should I just sell to carmax and does the lease sound good on the 2007 MKX?
hurry please, thank you!!!!

volvomax · November 2007

Too late, but take the trade to Carmax.
Lincoln dealer prob isn't making squat on the MKX and doesn't want to risk getting buried in the trade.

hondaodd1 · November 2007

hey thx for the info..i am trying to sell my car now..

allisonh · November 2007

So true, so I sold my end of Lease 2002 Highlander Limited to Carmax, and got a check for $400! Much better than turning it in to Toyota and having to pay the $300 disposition fee and $1000 in minor dings the inspector found. I leased the 2007 Lincoln MKX and believe I got an awesome deal. Please Let me know..these are the figures on my lease agreement:
MSRP $35,285
agreed upon value $32,707 (dealer said this is under invoice)
for $403.07 month includes tax for 39 months.
Here is where i get confused. I gave $1000 cash down, but the lease says $3693 was due at delivery. Dealer said this figure includes the $2750 rebates and that my tax, lic, etc and 1st month payment came out of that? sound right?

jaxs1 · November 2007

Most advertised lease specials seem to be 36-39 months. Do any car manufacturers have particularly attractive lease deals with 24 month terms right now?

milti · November 2007

Any help or opinions would be much appreciated.

I leased a 2006 X5 in June of 2006. It is a three year lease. I am thinking about getting a newer X5 (2007 or 2008) before my lease is up.

The reason for this is to get more options such as a trailor hitch and naviagtion without having to spend $2000 or so to pay for these options now, only to lose this money when I turn the vehicle in.

My questions are:

What should I be concerned with (and know about) canceling a lease early even though I want to re-lease from the same dealer? Do they give you a break on any early termination fees?

Does it affect my credit rating?

If I were to go ahead and pay to have these options installed and thereby raise the value of the car, how can this benefit me. Would it only benefit me if I were to buy the car at the lease's end or are there other benefits or even potential drawbacks?

bodble2 · November 2007

A fact that some people may not be aware of is that you can actually trade in a leased vehicle. Since you want to lease another BMW, that should make it even easier. I would suggest to go speak with your dealer. They'll look up the resale value of your current car, and compare it to the buyout, and then they could advise you as to whether you can just sign over the lease to them, or if some money has to change hands, either from you to them, or from them to you.

kyfdx · November 2007

Just about the only way to get out your lease early, is to get someone to assume it, or as bodble2 suggests, trade the car in to the dealer.

You can't just give the car back and terminate the lease. The costs of doing that can be very, very substantial, and can negatively affect your credit rating.

I think you'll find that when/if you try to trade the car into the dealer, the loss you'll take will be substantial, as well. Leases are designed to be taken to end of term. When you don't or won't live up to the lease terms, it can be very expensive.

Regards,
kyfdx
visiting host

volvomax · November 2007

If all you want is Nav and a trailer hitch, I think you will find that it is cheaper just to put those items on your car now.
you cannot simply return the car and walk away.
ALL the payments must be in to the lease co before the vehicle is returned.
doesn't matter if there are 2 yrs or 2 months left on the lease.
As for a trade in, chances are you will be quite upside down.
I'd go put a hitch on and buy a Garmin.

milti · November 2007

Thanks to all for the information/advice,

One last question.

If I installed these items, would their be ANY benefit at lease closure, in terms of buying the vehicle or if I re-leased another vehicle immediately after?

thanks again

kyfdx · November 2007

If you buy the vehicle, you'll still have use of the equipment (trailer hitch). The after-market NAV, you just stick in your pocket and take with you. You really can't get an after-market NAV installed in your vehicle. (Well.. might be possible, but you wouldn't want to).

If you turn the car in, you won't get anything for the trailer hitch.

How bad do you need a hitch?

volvomax · November 2007

Anything you install on a leased vehicle after the fact adds no value to the car.

hondaodd1 · November 2007

hi guys...is me again, i was going to lease the van, but i got a bad saleman. so i didnt. anyways just yesterday i check the honda site and they have a new offer for the 2008 and 2007 odyssey. please help to decide which one is a better lease and should i try to negoatie? then i will go ahead and lease it.. thanks much

hondaodd1 · November 2007

here is the site
http://automobiles.honda.com/current-offers.aspx#

smitten1 · December 2007

What is the most efficient way to find vehicles whose owners want to get out of their leases?

Is there a contract I can use with a private owner in addition to the lease assumption contract provided by the lenders/ financing companies

snapper2 · December 2007

Most manufacturers do offer rebates for college grads and a good dealership should tell you about them as soon as you tell them you recently graduated!

bodble2 · December 2007

"...a good dealership..."

Is there such an animal? :P

cccompson · December 2007

Use Google - there are several such sites where folks are looking for someone to take over their lease.

joel0622 · December 2007

I don't know you live in a Foreign Country. :P

itons · January 2008

My agreed upon nissan monthly lease payment has increased by $7 over my previous payments from last year. Am I missing something? Can they do this?

Thanks

joel0622 · January 2008

The only way I could see that happening is if sales tax was raised in your area, and even then I don't know if it would apply.

kyfdx · January 2008

That is my thought, also.. If you live in a state where the monthly payment is taxed, and your state tax rate went up.... or maybe the local county added a sales tax?

volvomax · January 2008

Your tax rate changed.

cdcruizer05 · January 2008

My Grandfather leased a 2007 Cadillac Escalade in Jun 06. He now wants to trade it in on a new truck, the lease was for 48 months! My question is what is going to happen once he tries to do this and could he trade the Caddy in and not lease the truck or does he has to lease itI think he wants to buy the truck outright!

tidester · January 2008

Basically, your grandfather has two choices. He can either make all the outstanding payments or transfer the lease. The experts here can fill you in on the ins and outs of lease assumption. Oh, he does have a third option. He can keep the Escalade for 28 more months and be done with it!

tidester, host
SUVs and Smart Shopper

paisan · January 2008

Yup that pretty much sums it up. If he "trades" it in, then he would apply the trade-in value toward the remaining 28 payments + the buyout price that is in his contract. My guess is that the trade-in value will be less than what he owes so he'd have to roll some negative equity into the new car payment.

-mike
Motorsports and Modifications Host

Kirstie_H · February 2008

A large local newspaper is looking to speak to consumers who have used Web sites such as LeaseTrader.com and SwapaLease.com in getting a new vehicle. Please respond no later than Feb. 11 with your daytime contact information to Chintan Talati at ctalati@edmunds.com.

Kirstie_H · February 2008

A national newspaper is looking to speak to consumers who recently purchased or leased a new vehicle because of a good deal they found, whether it was low APR (financing), lease specials, rebates or other incentives. Please respond no later than Feb. 19 with your daytime contact information to Chintan Talati at ctalati@edmunds.com.

mseningen · February 2008

We're all aware of the painful sales-tax laws for leasing a vehicle in Texas.

I have a DBA in Florida, but still live in Texas. I'd like to lease
the vehicle physically in Texas, but register in Florida under my DBA
to avoid the Tax in Texas issue. (I'll pay taxes month - month in Florida).

Can this be done?

If so -- and I wait a sufficient period of time -- can I transfer the lease
back to me (or my wife) in Texas - as if I were transferring my Lease.
And then register the vehicle in Texas?

I know I have successfully transferred a lease from a third party
from out of state (happened to be from Fla), and I only had
to pay the $90 out of state residence registration fee for the vehicle.
This time around I'd like to pick the vehicle out firsthand (and
not have to transport it back from Florida)

thanks,

M

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