Lease Questions - Ask Here

CarMan@Edmunds · June 2004

I would be more than happy to help you out, kpbuck. What is it exactly that you need? If you would like me to give you an idea of what the lease programs are currently like for these cars, I need you to tell me how many miles per year you need to be able to drive them, 15,000, 12,000, or 10,000. If you would like me to come up with sample lease payment for them so that you know approximately how much money they will cost you, I also need you to provide me with their full MSRPs and selling prices. Once I have this additional information I will be able to help you out. Talk to you soon.

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CarMan@Edmunds · June 2004

Hello heathers. If the dealership that you are working with is advertising the Odyssey that you are interested in leasing for $3,000 below MSRP then your lease should definitely be based upon that price. This does not necessarily mean that this is what they are doing though. To be honest with you, I personally would want more of a discount on a hail damaged Honda Odyssey. Honda is currently providing $500 dealer cash on this van. So this means that your dealer can sell it to you at invoice, which probably is around $3,000 off of its MSRP, and still make $500. Most Odyssey models are probably selling for around invoice right now, given the fact that the all new 2005 Odyssey will arrive in showrooms later this year. I would personally want a much larger discount on a hail damaged vehicle, even if it has been fixed, or would insist upon leasing an undamaged vehicle.

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CarMan@Edmunds · June 2004

Jerry, Infiniti Financial Services' current 3 year, 12,000 miles per base lease money factor and residual value for the 2004 FX35 AWD are .00177 and 56%, respectively. Its lease acquisition fee is $550 in all states except for New York and I believe Rhode Island where there are vicariously liability issues.

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smd5 · June 2004

Thanks Car Man. I am going to negotiate my deal tomorrow. I will let you know how much money you saved me.

smd5

CarMan@Edmunds · June 2004

You're welcome, smd5.

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jack1000 · June 2004

Carman: Thanks for the great info and advice. Just one more question--Do the lease payments you calculated for me include the 6% NJ sales tax?

heathers · June 2004

Thanks Car_Man, do you know what the usual security deposit and acq. fees are?? I'd like to run a few numbers for myself before talking to them again.

Just so we're on the same page: Supposedly they are basing the lease on $25,822. Now what's the 24 mo. residual on this van? I am putting no money down and they are deferring the first months payment so that we will take it this week and not on July 1st as we wanted. How are they coming up with a payment of $415? We have $1700 in neg. equity we adding into the equation.

Thanks for all your help and letting me pick your brain.

gsn · June 2004

Hi Car_Man -
I'm considering an advertised 48 mo. lease on a Passat GL, but the terms don't add up. Here are the figures from the advertisement:

48 mo. term, 10,000 miles/yr.
Monthly payment = $229
MSRP = $22,355
Residual = $8942

Two things seems odd. One is that the residual figure is 0.40 of the MSRP. I thought an earlier post for a VW Passat had 0.40 as the residual value for 15,000 mi/yr, not 10,000. Wouldn't the residual be higher with the lower mileage allowance?
Two, in playing with the figures, the only way I can get things close to $229/mo. is if the capitalized cost is around $19,000, which is about $3,300 off MSRP. I hadn't heard of a discount that large being offered so I thought something must not be correct.
Thanks for any assistance.
Greg.

cheryl · June 2004

Hi Car man,

The MSRP on the Honda Accord EX V6 is $26,400.00.

wibble · June 2004

There is $1500 dealer cash on offer on the Passat GL this month.

danio · June 2004

The lease on my 2000 Camry CE is going to end in a few months, and I was wondering if I should just return the car, then lease another car (which I'm considering) or should I buy back the car first, sell it privately, then use the extra money to lease a new car. I'm considering the new Volvo S40 as a new car. I was just wondering if I were to really buy back my Camry after the lease is due, should I immediately sell it privately to maximize my profits? What I'm afraid of is depreciation and ending up selling the car for less. Also, the leasing rate for the new Volvo S40 is 5.8, which is a little high for me, do you see the leasing rate decreasing after a few months since it's a brand new car now?

Thanks in advance for any suggestions or advice, my main concern is whether I should buy back and sell the car immediately or if I should not bother buying it back.

danmiz · June 2004

Thanks again, Car_Man. I'm much more interested in the FX 35 AWD than I am the RX-8 anyway. I've checked a couple of Infiniti dealers in my area (NY) and can't get a better price (after negotiating hard)than $509 a month for 39 months, 12,000 miles per year, touring package, splash guards and cargo net. It is "$0 down" (actually, I have to pay the bank fee of $795 plus tax, documentation fee of $45, registration fee of $100 and first month's lease payment of $519 - a total of about $1,500 when I pick up the car). Does it sound like a good deal?

kpbuck · June 2004

Sorry Car Man,
I am interested in the money factor and residual factors for the audi A4 1.8T Quattro for 39 and 48 months. the same for A6 2.7T S-line but for only 48 m. Both with 12K and 15K miles per year.
Also, when calculating the lease payment that you gave to Nicole on the A4 with a MSRP 35245 and selling price 33962 your pretax payment was approx. 402. however when I tried to do the calculations with MF .0004 and RV 51% I get 431 a month.
any help would be appreciated as I plan on going to the dealers in the next several days. So I dont know the negotiated price yet.
Thanks in advance and this message board is very informative

CarMan@Edmunds · June 2004

No problem, jack1000. Since the calculation of sales tax varies so much from state to state, I never include tax in any of the lease payments that I calculate for consumers.

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CarMan@Edmunds · June 2004

You're welcome, heathers. American Honda Finance Corp.'s current lease acquisition fee is $595. Your security deposit should be your van's monthly payment rounded up to the nearest $25 increment. AHFC's current 2 year, 15,000 miles per residual value for a 2004 Honda Odyssey EX with the rear entertainment system should be 67% of its full MSRP. If you were to lease this van with only 12,000 miles per year, its residual value would be 1% higher for a 2 year lease. I have no idea how the dealer that you are working with came up with the $415 payment that they quoted you, but I can tell you approximately what I think you should be paying to lease this van if you tell me its full MSRP and selling price. Make sure to remind me about your $1,700 in negative equity when you provide me with the rest of this info.

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CarMan@Edmunds · June 2004

Hi Greg. Volkswagen Credit's residual values for the 2004 Passat are actually fairly low right now. Its current 4 year, 15,000 miles per year residual value for a 2004 Passat GL 1.8T sedan is 39%. This number would increase to 41% for a lease with only 12,000 miles per year and 42% for a lease with only 10,000 miles per year. This car has has a spread between its full MSRP and dealer invoice of just below $2,000 before any options are taken into account. When one combines this discount with the $750 dealer cash that Volkswagen is providing on VW Credit leases of this model we are able to get close to the discount that you mentioned in your message. If the advertised lease that you mentioned is indeed based upon such a low selling price, it is a heck of a deal.

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CarMan@Edmunds · June 2004

Thanks for the additional information, cheryl. OK, let's calculate a sample lease payment for you and see what we come up with. According to my calculations, if you were to lease a 2004 Honda Accord EX V6 w/o navigation (MSRP: $26,400 / selling price: $23,252) through American Honda Finance Corp. this month for 36 months with 15,000 miles per year, your zero down, pre-tax monthly lease payment should be right around $288. So as you can see something is not right with the payment that you were quoted, which is strange because I do not believe that Honda dealers are allowed to mark-up the money factors that are associated with this special program. Are you paying a security deposit and AHFC's acquisition fee at lease signing? By increasing your car's money factor by the amount necessary for a security deposit waiver and by adding the acquisition fee to your capitalized cost I come up with a payment of around $309 with only your first month's payment due at signing. You may want to comparison shop with a couple of other Honda dealers in your area just to see what other sort of quotes you receive on this model.

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CarMan@Edmunds · June 2004

Hi danio. The only reason why you may want to consider purchasing your leased car and selling it on your own is if you are absolutely positive that it is worth more on the open market than you would have to pay to buy it. Place a call to the bank that you are leasing it through to see exactly how much money it will cost you to buy and then compare this number with its Edmunds.com True Market Value that is available on this site. You may also want to stop by the "Real World Trade-In Values" discussion that appears on this Message Board for feedback on your car's current value. If you are not absolutely positive that you can turn a profit on your car by buying it or if it has been involved in any sort of accident, you are best off just returning it at the end of your lease and walking away.

Manufacturers try to provide as little lease support as possible on vehicles at the beginning of the model year. This is especially true with new or recently redesigned models. As the model year progresses manufacturers will often increase their lease support to help offset a natural drop in vehicles' residual values. Automakers will also increase their support on new vehicles as consumer interest in them begins to wain. I definitely think that there is a chance that Volvo will increase its lease support on the S40 later on this year, but as I always say it is impossible to predict what a manufacturer will do with its future incentives with 100% accuracy.

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CarMan@Edmunds · June 2004

You're welcome again, danmiz

. I am not sure what sort of lease payment you can expect to get on this model off of the top of my head, but if you provide me with its full MSRP and selling price, I would be more than happy to calculate a sample lease payment on it for you that you can use as a reference point.

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CarMan@Edmunds · June 2004

Don't worry about it, kpbuck. It happens all the time. I am glad that you find this discussion so informative. Here is the information that you are looking for, if you were to lease an Audi A4 1.8T Sedan with quattro through American Honda Finance Corp. in Ohio this month for 39 months with 15,000 miles per year, its base lease money factor and residual value should be .00086 and 51%, respectively. The numbers for an otherwise identical 48 month lease of this car should be .00096 and 45%. If you were to lease a 2004 Audi A6 2.7T S-line through AFS in Ohio right now for 4 years with 15,000 miles per, its base lease money factor and residual value should be .00030 and 41%. If you were to lease either of these cars with only 12,000 miles per year, their residual values would be 2% higher. If you decide to go with the A6 2.7T S-Line, during your negotiations keep in mind that Audi is providing $2,000 dealer cash on AFS leases of this model in your area this month. This cash will help you to negotiate a more attractive capitalized cost.

I am not sure why the lease payments that we calculated came out differently. For more information on how to calculate lease payments, you should check out the following article: Calculate Your Own Lease Payment or you can visit the Edmunds.com Lease Calculator.

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danmiz · June 2004

Thanks again, Car_Man. I'm much more interested in the FX 35 AWD than I am the RX-8 anyway. I've checked a couple of Infiniti dealers in my area (NY) and can't get a better price (after negotiating hard)than $509 a month for 39 months, 12,000 miles per year, touring package, splash guards and cargo net. It is "$0 down" (actually, I have to pay the bank fee of $795 plus tax, documentation fee of $45, registration fee of $100 and first month's lease payment of $519 - a total of about $1,500 when I pick up the car). Does it sound like a good deal?

gsn · June 2004

Thanks Car_man. I guess the only hitch is the 4 yr. lease term, but at least the warranty is 4 yrs. too!
Greg.

kiszka6911 · June 2004

We are looking at a 2005 dodge magnum sxt. Full MSRP with options is 27300$, friends and family gets us 1% under dealing invoice, or 25145$ We would be looking for at least 15K miles.

Thanks
TK

kyfdx · June 2004

I believe that is the incorrect MSRP. I think the MSRP given in the message is without destination included. Another $590 for that, I think. That might be the reason for the discrepancy.

regards,
kyfdx

heathers · June 2004

Thanks.

MSRP- 28230 + 357 add ons + 295 dealer prep

selling price - 25872
residual - 20,575.80
MF - .00123
neg equity - 1700

Does that cover it? Thanks again!!!

mdargan · June 2004

Hello,

I am new to car leasing. I have always purchased my cars in the past. I am interested in getting a G35 with a sticker price of $35,972. Can you pls tell me what kind of a monthly payment to expect. Thanks.

yrneh1 · June 2004

I saw on the Acura.com that there is a special lease for the base model MDX right now. 499/mo with 999 down (1999 drive off). Is this a good deal? What are the money factor and residual value term? (I calculated it to be 0.0018 and 61%) I want Touring model w/NAV and have a quote from a dealer for $37900. What would be the monthly payment for this model? Thanks for all your help, Carman.

drsmith102 · June 2004

My 2002 Honda Accord Special Edition lease is up in January 2005 and I am wondering if I should buy the car at the end of the lease, or just send it back. Based on my driving history/style come January 2005, the car will only have around 25-28,000 miles (of a 3yr/36,000M) on it and around a $250 extra wear and tear(I am estimating based on previous Honda end of lease inspections I have been a part of in previous years)expense.
Thanks
drsmith102

CarMan@Edmunds · June 2004

You're welcome, Greg.

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CarMan@Edmunds · June 2004

Hey kiszka6911. I've answered a million questions in this discussion lately and can not remember what we were talking about. Did you want me to calculate a sample lease payment on this model for you? If so, how long did you want to lease it for again?

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CarMan@Edmunds · June 2004

Welcome to the wonderful world of leasing, mdargan. I would be more than happy to give you an idea of what sort of lease payment you should expect on this car. However, in order for me to do so, I need you to answer a few questions for me first. How long do you want to lease this car for? Most leases are around 36 months in length. How many miles per year do you need to be able to drive this car, 15,000, 12,000, or 10,000? Lastly, what sort of selling price have you been able to negotiate or do you expect to be able to negotiate? Once you answer these three questions I will be able to help you out. Talk to you soon.

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CarMan@Edmunds · June 2004

Hi yrneh1. Acura is indeed advertising a lease on the 2004 MDX this month. This is the first time that it has advertised a sample lease on this model. Having said this, this is technically not a special lease. It is actually based upon American Honda Finance Corp.'s standard lease program and is very similar to any deal that one would have been able to negotiate on this truck in the past. Always remember that the selling prices of leased vehicles are negotiable. I don't remember the exact prices that this advertised lease is based upon off of the top of my head, but like most manufacturer-advertised leases, I suspect that you should be able to negotiate a lower selling price than the one that was used to arrive at this payment if you shop around a little bit. Just in case you are interested, a lease money factor of .00250 was used to arrive at this payment. I would be more than happy to calculate a sample lease payment on the exact model that you are interested in for you, but in order for me to do so I need to know this vehicle's full MSRP, how long you want to lease it for, and how many miles per year you need to be able to drive it.

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CarMan@Edmunds · June 2004

Hello drsmith102. It is difficult to say right now whether you should purchase your leased Accord. About a month or two prior to the scheduled end of your lease, place a call to the bank that you are leasing it through and ask them exactly how much money it will cost you to buy your car. Once you know the cost, you need to compare it to what your car is realistically worth on the open market at this time. Do not purchase your leased vehicle unless A) you really want to keep it or

you are absolutely positive that it is worth more than its purchase price, taking any wear and tear charges that you would have to pay when turning it in into account.

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nunuww · June 2004

Hi Car_Man,
Thank you so much for the advice. i am really very unclear about leasing. I leased a BMW X5 from dealer, and each month the payment is paid to BMW Financing. in this case, do i need to return the car to the dealer, or any dealer designated by BMW?
I will be moving from PA to N. Carolina, where can i learn info on tax rates of leasing cars?
what might I pay in extra if i decide to buy the car now?
Thank you for further kind advice! Best!
Nunuww

spatulaman · June 2004

I've been away for a while, but it looks like BMW's program on the X3 just keeps getting better. Car_man, could you provide the exact details on what the lease program for this looks like?

I'm thinkin a 2.5 or 3.0 w/ manual trans and premium and leather. 39 months, 12k per year. What's the MF and residual for each? Incentives only on the slushbox equipped models, or has that been expanded to include more?

jimtnc1 · June 2004

I've come up on this situation and don't know what to do. I'm buying my wife a car (25000mi) and discovered the vehicle I want was titled as a rental vehicle. The other vehicle (20000mi)I like is titled as a lease vehicle. Is it common sense that rental cars have probably been mistreated so stay away from them, or could this be unfounded or at least not an important issue any longer?

These cars are pretty nice and priced right...even to be driven hard. What say you about my dilemma??

danial · June 2004

Question for Car Man or anyone knowledgeable. I'm getting a 2004 BMW Z4 in Indiana. MSRP is $41,343. My cost will be $36,845. What should I expect for residual value, cost of money, acquisition fee, and disposition fee for a 3 yr 12,000 mile/year lease. Also the approximate cost of gap insurance.

Thanks.

cjs2002 · June 2004

looking to lease a chrysler 300 for 36 or 39 months with 15 K miles a year... I'm eligable for the employee discount (father works at chrysler ) and wanted to know what the lease payments on the car would be... I only wanted to add the sunroof to the 300 with hemi... the price is 27000 (after my discount) could you please inform me as to what the residual and monthly payments would be.. thanx MSRP is rouphly 32500...

westtx · June 2004

Car_Man..I am almost through my first year (AUG) on our 48 month lease through Honda Financial, have 15k per year and am about to hit 20k. Was told by dealer that I could bring vehicle back early when hit 60k, but am now reading this board and other sources that tell me otherwise. Any suggestions on what I can do? Am concerned about drastically exceeding mileage based on first year usage.

wilco · June 2004

Heathers and Car_Man-
I received the following offer on a 2004 Ody EX-RES, no extras

MSRP: 28,980 (Note this is $750 above published MSRP of 28,230 because AHFC is not counting the $750 discount on the RES for this lease as confirmed in the promotional lease ad for the EX-RES)

Selling price: $25,948 (pretty standard, should be able to do a little better on a undamaged car and a lot better on a hail damaged car)
Residual: 71% -> $20,576 (Car_Man, is this correct?)
Money factor: 0.00113 (0.00123 if you choose to waive security deposit)

For nothing down except security deposit, the monthly payment is $343, which includes 7% tax

I use the $25 software at www.leasewizard.com which is a little more accurate then the online calculators. There's also free spreadsheet at www.carbuyingtips.com that works well too.

CarMan@Edmunds · June 2004

You're very welcome, Nunuww. You are leasing your truck through BMW Financial Services and are free to return it to any BMW dealer in the continental United States, not just the one that you took delivery of it from. As far as taxes go, you may be able to find out more information on this subject by visiting one of the following Web sites: North Carolina Department of Transportation - Division of Motor Vehicles or North Carolina Department of Revenue.

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CarMan@Edmunds · June 2004

Hey spatulaman. Yep, BMW's lease program on the 2004 X3 was enhanced again in June. The dealer cash on this vehicle is still only available on 3.0 models with automatic transmissions though. If you were to lease a 2004 BMW X3 2.5 through BMW Financial Services this month for 39 months with 12,000 miles per year, its base lease money factor and residual value should be .00175 and 61%, respectively. The numbers for an otherwise identical lease of a 2004 BMW X3 3.0 should be .00150 and 61%.

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CarMan@Edmunds · June 2004

Hi jimtnc1. Different people have different opinions on this particular subject. There are those who will never purchase a former rental car because they are afraid that they have been abused. Others feel as though rental cars are fine to buy because theoretically they have at least been maintained properly by the rental company (As a side note, I have spoken with former employees of rental car companies who claim that routine maintenance is not performed frequently enough on vehicles). I feel as though each vehicle really needs to be looked at closely and taken on a case by case basis. As long as you inspect a used vehicle thoroughly and it checks out it really shouldn't matter too much where it is from. Having said this, I personally would not feel comfortable purchasing a former rental car because I have seen first hand what sort of abuse they receive from people.

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jabber · June 2004

Carman,
Can you post the following for a 2005 300C with 15,000/year at both 24 and 36 months?

-Residuals
-Money Factors
-Acquisition Fees
-Disposition Fees
-Over mileage charge

Thanks!

beachlvr · June 2004

Hi! I have a 2002 GMC Envoy that I leased in AZ through GMAC and brought with me when I relocated to GA. I would like to buy the Envoy now at the end of my lease. However, with the slow sales of SUV's, due to the gas situation, do you think it would benefit me to try to haggle with the local dealership here in GA? GMAC tells me that the price to purchase is $16,274.81,including tax. My credit union will offer a loan for the Kelly Blue Book trade-in value which is $15,825.00. Opinion?

dosei · June 2004

Carman:
Please help me determine a good monthly payment for the lease of 2 BMW 3 series convertibles. We are trying to decide if we can afford a 330. We are looking for a 39 month term, no money down (besides tax, license, etc), and 12,000 annual miles.

325ci Conv: MSRP $49,000 Invoice $45,000 TMV $48,000

330ci Conv: MSRP $52,000 Invoice $47,500 TMV $51,000

Please suggest what we should look to pay for these vehicles based on the above approximate prices, and also factors we need to look out for (money factors, residuals, leasing fees, etc). By the way, we are in Northern California, but will be shopping in Southern California as well.

Also, if anyone has leased either of these vehicles recently, please post your terms and monthly payments for reference. Thanks!

nunuww · June 2004

Thank you so very much, Car_Man! you clear all those doubts i had.
All the best!

nunuww

CarMan@Edmunds · June 2004

Hi danial. Let's see if we can answer your questions. If you were to lease a 2004 BMW Z4 through BMW Financial Services in June for 3 years with 12,000 miles per, its base lease money factor and residual value should be .00200 and 56%, respectively. BMW FS' base lease acquisition fee is $525 in every state but New York and I believe that it charges a disposition fee of $350. Many luxury manufacturers' captive finance companies automatically include gap insurance in their leases. I am not sure if this is the case with BMW, but there is a good chance that it is.

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CarMan@Edmunds · June 2004

It's always nice to be able to purchase a vehicle through an employee or supplier purchase program. You don't have to haggle and are assured of an attractive selling price. Let's work up a sample lease payment on this car for you. I actually really like the new Chrysler 300. It has one of the nicest interiors of any DCX product and the grill is pretty neat looking. The only thing that I personally don't like about it is the styling of the rear. I bet that it is a pretty fun car to drive with the Hemi in it. According to my calculations, if you were to lease a 2005 Chrysler 300C with an MSRP of $32,500 and a selling price of $27,000 through Chrysler Financial right now for 36 months with 15,000 miles per year, its zero down, pre-tax monthly lease payment should be right around $381.

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CarMan@Edmunds · June 2004

I am sorry to say, westtx, that it sounds like your salesperson was not completely truthful with you. Sure you can bring your van back to the dealership when you hit 60,000 miles on it, but they will not be able to do anything for you. Your lease is between you and the bank that you are leasing it through and has absolutely nothing to do with the dealership that you took delivery of your Odyssey at. If you exceed your van's mileage limit you will have two options, to turn it in at the end of your lease and pay an excess mileage penalty or to purchase it from the bank that you are leasing it through and try to sell it on your own / trade it in on another vehicle or continue to drive it. The only wan that you probably will not lose money is purchasing and continuing to drive this van for a while.

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