Lease Questions - Ask Here

CarMan@Edmunds · August 2004

Hi parm. The type of loan that you described is known in the industry as a balloon note. I am not surprised that your local bank quit offering balloon notes. Many independent banks have been burned by the over estimation of residual values over the past several years, and have either cut way back on or dropped their lease and balloon note programs completely. Most manufacturers' captive finance companies offer balloon notes, at least in certain parts of the country. There is nothing wrong with balloon notes. In fact, they are basically the same as leases in that they provide consumers with low monthly payments and an option to purchase their vehicle at the end of a specific period of time. The main difference between balloon notes and leases is that the driver's name is on the title with a balloon note, while the bank's name is on the title with a lease. As a result, many states charge taxes differently on balloon notes.

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CarMan@Edmunds · August 2004

Sure thing, ctorrey. If you were to lease a 2004 Audi A6 4.2 through Audi Financial Services in MA for 36 months with 12,000 miles per year, its base lease money factor and residual value should be .00125 and 50%, respectively. The numbers for an otherwise identical lease of a 2004 A6 2.7T S Line are .00010 and 49%. Audi is currently providing $1,500 dealer cash on AFS leases of the '04 A6 2.7T S, but no dealer cash on leases of the A6 4.2.

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CarMan@Edmunds · August 2004

Hey pdurant. I just answered this question for you in post #12716. Please check there for my response and let me know if you have any other questions.

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CarMan@Edmunds · August 2004

Hi again JP. Here is the information that you are looking for. If you were to lease a 2004 Volkswagen Touareg V6 through VW Credit right now for 3 years with 12,000 miles per, its base lease money factor and residual value should be .00045 and 51%, respectively. Using these numbers on a Touareg with a full MSRP of $36,515 and a selling price of $34,000, I come up with a zero down, pre-tax monthly lease payment of around $451. If you were to make a $1,000 capitalized cost reduction, I always advise consumers against doing so, it would reduce this model's payment to around $423. When negotiating your lease on this vehicle, keep in mind that Volkswagen is providing $500 dealer cash on VW Credit leases of it at this time.

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CarMan@Edmunds · August 2004

Congratulations on your new ride, ranajo. Thanks for taking the time to come back and let us all know how everything turned out. Enjoy!

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CarMan@Edmunds · August 2004

Parm, I just replied to your original message in post #12717. Please have a little patience, I am not on this board 24 hours a day. Thanks.

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CarMan@Edmunds · August 2004

You're welcome, pktrckt. I don't know what the program number is for the dealer cash program that we spoke about earlier, but trust me the dealer that you are working with definitely already knows about it. I find it very hard to believe that they would not know about a promotion that gave them an additional $750 on almost every vehicle that they sell. I think that they are just holding out on you for additional profit.

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pdurant · August 2004

Carman,

Thank you very much for the information! You have been a great help. I'll let you know what kind of deal they offer me.

PD

cpaman · August 2004

Hi Car man,

I am interested in leasing a 2005 Chrysler 300 Touring. I was wondering if you know what the money factor and residual value is for this car, it's pretty popular and the few dealerships that i have talked to are resistant to negotiating down the price, any advise? I am assuming the lease should be in the high 300's to low 400's, any information you can give will be greatly appreciated, this is a great site.

Thanks

jiii267 · August 2004

Thanks CarMan. I'm off to the dealers and I'll let you know how I do.

JP

CarMan@Edmunds · August 2004

You're absolutely correct, 307web. The highest mileage allowance that most captive finance companies lease vehicles with, other than Ford credit, is 15,000 miles per year. As you mentioned, most banks will sell additional miles to consumers at lease inception for less than they would have to pay in excess mileage charges had they exceeded their allowance. For instance, Audi Financial Services only charges $.15 per mile at lease signing, but $.25 per additional mile at lease-end. This is a typical discount for paying for miles in advance. What model or models are you interested in? Perhaps I can give you an idea of what sort of discount they provide.

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CarMan@Edmunds · August 2004

Njl, Yikes, $700 a month to lease a Toyota Sienna?!?! I would be more than happy to work up a sample lease payment for you on the exact Sienna that you are considering, but in order for me to do so, I need you to provide me with its full MSRP.

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CarMan@Edmunds · August 2004

No problem, cabaiste. The lease cash that I mentioned in my previous message to you would be exactly the same for this Durango, but Chrysler Financial's 2 year, 12,000 miles per base lease money factor and residual value for a 2004 Dodge Durango Limited 4WD (non-Hemi) should currently be .00072 and 61%, respectively. The numbers for an otherwise identical 3 year lease of this truck should be .00133 and 54%.

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CarMan@Edmunds · August 2004

Hello cole. Infiniti is currently providing its dealers with $250 certificates that can be used to reduce vehicles' prices. I don't know exactly how many of these certificates each dealer receives, but I do know that they can use up to four of them on sales of 2004 FX35 models. I am sure that there's not enough of them to use four on every sale, but if you comparison shop you should be able to get the dealer to use a few. As far as this model's lease program goes, if you were to lease a 2004 Infiniti FX35 through Infiniti Financial Services this month, its base lease money factor should be .00179 for any length lease. The residual values for this vehicle are as follows: 55% for a 3 year, 15,000 miles per lease of an '04 FX35 AWD, 56% for a 3 year / 12K lease of this model, 47% for 4 year / 15K, and 49% for 4 year / 12K. The residual values for the 2004 FX35 2WD are 1% lower for all of the above term / mileage combinations.

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CarMan@Edmunds · August 2004

Hey kyfdx. The information that you posted on the 2004 BMW X3 2.5 is correct. Its numbers for a 3 year, 15,000 miles per lease of a 2004 X3 3.0 should be .00095 and 59%.

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kyfdx · August 2004

thanks again!!

CarMan@Edmunds · August 2004

You're very welcome, PD. I am glad that I was able to help you out. I am looking forward to hearing how everything turns out.

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CarMan@Edmunds · August 2004

Any time, kyfdx.

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njl · August 2004

Thank you so much Car_man. The MSRP is $40,508.

CarMan@Edmunds · August 2004

Hi cpaman. There's not really any secret to getting the lowest price possible for a car or truck, other than comparison shopping. Take a look at the "Chrysler 300 / 300C: Prices Paid & Buying Experience" discussion that appears on the Edmunds.com Town Hall's Prices Paid & Buying Experiences Message Board to get an idea of what this car is selling for right now and then shop around to see the best deal that you can get. I would be more than happy to give you an idea of what this car's current lease money factors and residual values are like, but I need some additional informaiton form you first including how long you want to lease this car for, how many miles per year you need to be able to drive it, and the trim level of the model that you want(i.e. the 300C, the 300 Touring, etc...).

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CarMan@Edmunds · August 2004

No problem, njl. OK, according to my calculations, if you were to lease a 2004 Toyota Sienna XLE Limited with an MSRP of $40,508 and a selling price of $38,212 through Toyota Financial Services this month for 3 years with 15,000 miles per, your zero down, pre-tax monthly lease payment should be right around $584. This is still a really high lease payment, but nowhere near as bad as the $700 that you were quoted.

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CarMan@Edmunds · August 2004

No problem, JP. Talk to you soon.

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bobbylove · August 2004

I have a lease quote of $556 a month for 39 months, no money up front for a G35 AWD, Bose, Sunroof without the premium package. Does that sound about right?

njl · August 2004

Thanks again Car_Man, you are providing a great service to the consumers.

Ageed, $584 (pre-tax), is better but still very high. I need to keep looking for a better mini-van value.

Thanks again!

kyfdx · August 2004

Honda Odyssey... 24 month lease.. you can get it loaded, with no downpayment, for $350/month, tax included.. It won't be as nice as that $40K Sienna, but at half the price, you can't go wrong....

regards,
kyfdx

mike004 · August 2004

Hi Car_Man.
I am looking at leasing a 2004 Saab 9-3 Linear 36mo/12k for my wife. I'm able to get GMS (full employee discount) pricing through a friend of mine. Saab seems a little tricky on what percent off GMS is, the dealer is telling me 9%. I am also told the residual value is 46% with a money factor of .00063 and $3000 lease cash from GM. Are these numbers correct for August pricing? The reason I ask is I found a June or July post from you on this vehicle with a residual of 48%, money factor of .00075 and 3500 lease cash. Thanks for the great information.

mike004 · August 2004

Hi Car_Man.
I am looking at leasing a 2004 Saab 9-3 Linear 36mo/12k for my wife. I'm able to get GMS (full employee discount) pricing through a friend of mine. Saab seems a little tricky on what percent off GMS is, the dealer is telling me 9%. I am also told the residual value is 46% with a money factor of .00063 and $3000 lease cash from GM. Are these numbers correct for August pricing? The reason I ask is I found a June or July post from you on this vehicle with a residual of 48%, money factor of .00075 and 3500 lease cash. Thanks for the great information.

ksharma01 · August 2004

HI all,
SO here is the deal I ended up signing...

MSRP $45745
Invoice $41895
Selling price $41495
Net Cap $42020

Term 36 mo
Residual 56%
MF .0017
Payment before taxes: 570

The extra .0002 in MF (over the .0015 that Car_man gave) will cost me $530 over the term of the lease... worth it for me at this point.

Hopefully this is in line with what an amateur car buyer can negotiate... definitely a lot better than if I had not found this forum! But I'm sure Car_man would have done much better!

Thanks to Car_man and kyfdx for the active input! I am now driving a BMW 330i with performance and you two definitely helped!

bobbylove · August 2004

I have a lease quote of $556 a month for 39 months, no money up front for a G35 AWD, Bose, Sunroof without the premium package. Does that sound about right?

mike004 · August 2004

Hi Car_Man.
I am looking at leasing a 2004 Saab 9-3 Linear 36mo/12k for my wife. I'm able to get GMS (full employee discount) pricing through a friend of mine. Saab seems a little tricky on what percent off GMS is, the dealer is telling me 9%. I am also told the residual value is 46% with a money factor of .00063 and $3000 lease cash from GM. Are these numbers correct for August pricing? The reason I ask is I found a June or July post from you on this vehicle with a residual of 48%, money factor of .00075 and 3500 lease cash. Thanks for the great information.

brown44 · August 2004

I am trying to get some information about leasing a 2004 Armada SE. I have not done any negotiation at this point. I would like to get an SE with the Bose and DVD which according to the Nissan site is about 39k. I would settle for one without it if the deal was right. I do not want any other options. I am trying to weigh whether it makes sense to lease one for 36 months/12k a year or buy a ~1 year old one. If I found it to be reliable, I would like to but it out at the end of teh term. I have never leased before, but I am considering it in this case because it is a 1st year model. Please let me know what I should shoot for payment wise and buy-out. Also, could you let me know if you think the deals will improve considerably if we wait until Oct. I can wait that long if the deal is worth it. Thanks for your help.

njdriver1 · August 2004

Hi CarMan, I'm getting antsy for a new set of wheels. My BMW 330i is up 10/15. Does it make any sense at all to walk away at this point to take advantage of current low rates on end of model year cars (volvo s60, audi a6, etc). I've got one payment of $550 to make on the bimmer.

I love the car, but I've gotten to the point in my life where I need some more room in the back seat- the kids are bigger and its getting a little cramped back there.

I'd like to keep my payments around the same, under $600. Any suggestions? What are you liking this year in a sedan?

bobbylove · August 2004

I have a lease quote of $556 a month for 39 months, no money up front for a G35 AWD, Bose, Sunroof without the premium package. Does that sound about right?

sharkbait2 · August 2004

What and how does one go about calculating the money factor as an actual finance charge or interest rate for the entire term of the lease? And, what exactly is the capital cost reduction? Thanks for your help.

kyfdx · August 2004

money factor X (residual + cap cost) = monthly finance charge

monthly finance charge X number of payments = total finance charge

MF X 2400 = approx. APR

capital cost reduction = downpayment

wibble · August 2004

The host of this board isn't here full time to answer questions. I'm sure he has a real job! One post should be enough. Anyway, seeing as this appears to be urgent hopefully no one will mind if I have a look at this.
The MSRP of the car you're looking at is $34590. You didn't mention the negotiated price. It should be possible to get one of these pretty close to invoice at the moment but for the sake of calculation, I've assumed $1000 over invoice at $32754. So assuming this, and 12000 miles per year over 39 months I get an approximate monthly of $466 excluding tax.

cpaman · August 2004

Car Man

Here are the details of the lease i am looking for:

Term - 36 months
Miles - 10,000 - 12,000
Model - 300 Touring Sedan
Options - Sound, Power Moon Roof, and Cold Weather
Color - Blue

Thanks for you help on this.

njl · August 2004

OK Car_man...what do you think?

2004 Ford Expedition Eddie Bauer model
MSRP: $48950
Sell Price: $38450
Taxes: 1227
Net Cap Cost: $39677
36 month lease 15K/year
Inception: $1559
Payment: $568

I'm currently in a lease that terminates in November. I'm not over mileage but I'm wondering if the the year end incentives justify leasing now rather than in November?

Thanks

dkline · August 2004

We're interested in Honda's $259/month lease offer on the Odyssey EX-RES, with a $1499 cap cost reduction and 68% residual.

My question, though, is whether we shiuld grab this lease offer before it expires 9/7 or wait until the end of the calendar year (when we'll really need the car) and hope for a lease offer (presumably on a 2005 Odyssey) that's as good or better than their current one.

Advice appreciated.

kyfdx · August 2004

I can't answer that part for you, but I can guarantee that leases on the all new '05 Odyssey will probably be at least $75-$100 more per month than what they are on the old one, right now. Look up a few posts and see what the quotes are for the all-new $40K Sienna are.. and that might give you some idea..

regards,
kyfdx

gold233790 · August 2004

Ok, thinking of trading in my 2000 Audi A8, and leasing an '04 A6 2.7S.

My question is this- how likely are dealerships to cut me a check for my trade-in, and then lease me the new car?

Edmunds tells me the current value of my trade in is around 20k. I'll be conservative and assume I'd get a little less than that....but I currently don't have a payment on my A8 and would like to use the proceeds to take care of part or most of my lease payments over the next 3+ years.

boater2 · August 2004

I think I understand how leases work but I am wondering how you find out what the base lease money factor is. I am currently looking at a 2005 Pacifica AWD in Connecticut - 3 year lease, 15K miles per year.
Thanks.

mslater1 · August 2004

Hello,

I saw an newspaper ad for taking over a lease on a 2003 BMW 325i. The lease is good for 21 more months; pmt is $385 a month. The lease ends in mid '06; the buyout value is $20,500. Supposedly in excellent condition. Mileage is right on the allowance.

Seems like a good deal; since you have to put a few grand down on higher end cars, it almost seems like this person has taken on the brunt of the depreciation and the upfront financial strain of this car. Am I missing something, or is this a very good deal? Thanks for any advice.

need_a_new_car · August 2004

Hi Car Man,

First off, thank you for taking the time to read this post.

Here's the deal. I have a few bumps on my credit including a big one that I am in litigation on. It will be resolved in my favor but currently it is still on my credit. Even so, I was able to lease a MBZ E430 and finance a C280 at the same time. The lease was up more than 6 months ago on the E430 and I am looking to sell the C280. I want the advertised lease deal on a BMW 3.0 but I can't seem to find a dealer that is interested in helping me. One dealer I contacted through Edmunds sent me an email stating in uncertain terms that the BMW lease deal on X5's is impossible to get. That it exists simply to drive business on more expensive cars. Great. Is this really the case? If I lease a car with a few more options will I be able to simply do the math with the lease special to come up with my new payment or do all the incentives apply exclusively to "ad" car?

Mercedes-Benz loves me and is willing to lease me almost anything but I don't like the M and I need an SUV. So will my credit problem push my money factor through the roof? How can I keep the dealer from using this against me to increase his profit? Also, is there anything I can do to mitigate my credit problem? My attorney says it will take several months before we get a settlement and then get my derog removed. I'd love to be able to wait on a car but my C280 is getting long in the tooth and I don't want to pump a few grand into it for repairs.

Thank you again for your time.

rroyce10 · August 2004

..**How can I keep the dealer from using this against me to increase his profit?**

               I think your getting the two things mixed up .. your credit is whats directly reflective of what you can purchase, or not, and thats based on the Lender not the dealer ... that being said, some dealers can get deals bought that dealer 20 minutes away can't, and thats usually based on volume ..

               Not to sound smart, but most attorneys have little or -0- knowledge on what it takes to correct bad credit (considering they have some of the worst credit on the planet .l.o.l.) you need to find a *large* Bimmer dealer in your area (if thats your choice) and speak with the finance manager "directly" and have all your paperwork in tow .. emailing, faxs and a voice over the phone with "less" than perfect credit won't get anyone excited because dealers hear it everyday ..

                 I hope this helps ....

                            Terry.

egrmi · August 2004

About a week ago I was given a money factor of .0018 and a Lease End Value of $22,664.40 on the 2004 AWD Lexus RX330.

mike004 · August 2004

Car_Man
Can you tell me the residual and money factor on leasing a 2005 Chevy Equinox for 3yr/12000 or 4 yr 12000 FWD LT and AWD LT. I appreciate the service.
Thanks.

need_a_new_car · August 2004

To clarify, I didn't lease the E430 and purchase the C280 on the same day. I had previously leased the C280 then decided to buy it. When I decided to purchase the C280 I leased the E430. So I had established a solid payment history with MBZ for many years despite my credit issues.

need_a_new_car · August 2004

Thanks Terry, but I guess I was unclear in my post. My question was actually twofold. 1) Are the factors influencing the BMW lease deal that is advertised good for cars with more options and 2) How can I prevent the dealer from using my credit to artifically raise my money factor allowing the dealer to pocket additional money. I was also hoping that perhaps a copy of the court papers or a letter from my attorney or if anyone has experience with this, a challenge to the credit bureau, might give me leverage.

Also the dealers aren't balking at my credit - they haven't pulled it yet. They are acting as if I can't buy an X5 for less than $50k.

gofast1 · August 2004

I too am interested in the factory ODY lease but lack details. My main question is should I be negotiating a price then ask for the factory lease. I like the $259/month but don't want to get stuck with a low residual when the lease is up. Am I thinking straight here? Is this as good a deal as it seems? Thanks for you help.

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