Lease Questions - Ask Here

CarMan@Edmunds · October 2004

Hi jessicao. Most dealers will not care if you have a loan on your trade or own it outright. The only thing that they are concerned about is selling you a new vehicle. You can and should get any dealer that you lease a new vehicle from to cut you a check for the difference in what you owe on your truck and how much they are willing to give you for it. You can use this money as a down payment on your next lease, but it is never a good idea to put money down when leasing.

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CarMan@Edmunds · October 2004

Hey njl. If you were to lease any 2005 Toyota Sienna through Toyota Financial Services in its New York region right now, its 36 month base lease money factor should be .00225. I believe that the 36 month, 15,000 miles per year residual value for a 2005 Sienna XLE Limited AWD should currently be around 57%.

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bkln · October 2004

Car_Man:

I have negotiated $ 13,145 (with destination included) plus tax and reg., fees. as the selling price.

The lease terms would be 12,000 mi/yr over 36 months.
Approx. 1200 due at signing for fees.
The car will be liscensed in New York City, but the dealership is in New Jersey. Sales ax will be 8.625%.

Thanks:
BKLN

njl · October 2004

Thank you...

Would the same figures apply for the 2005 Sienna XLE AWD (no limited).

Thanks again.

CarMan@Edmunds · October 2004

Here is the information that you are looking for, liannell. If you were to lease a 2004 Infiniti G35 Sedan 2WD through Infiniti Financial Services right now for 3 years with 15,000 miles per, its base lease money factor and residual value should be .00179 and 59%, respectively. The numbers for an otherwise identical 4 year lease should be .00179 and 50%.

You were absolutely correct when you stated that assuming the same term and mileage allowance, the residual values for a lease of an otherwise identical 2005 model would be higher. These higher residual values would in turn provide a lower lease payment on the '05 model, provided that the same selling price and money factor were used. If one was able to negotiate a low enough selling price or there is a decent amount of lease money factor support on the 2004 model, it may still be less expensive to lease than an '05 model will be.

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tdevane · October 2004

thanks Car_Man. In calculating the Lease is the MSRP or the Agree Sale Price used? Toyota quoted me $650 on a 3 yr 15,000 mile lease. I thought that seemed high.

CarMan@Edmunds · October 2004

I sure do, hipreck, but for some reason Daimlerchrysler is not providing much in the way of lease support on the 2005 Jeep Grand Cherokee yet. Perhaps dealers still have a ton of 2004 models and they want to wait until they are almost gone before they crank up the support on the 2005s. If you were to lease a 2005 Jeep Grand Cherokee Laredo 4WD through Chrysler Financial this month for 3 years with 15,000 miles per, its base lease money factor and residual value should be .00239 and 54%, respectively. When negotiating your lease on this truck, keep in mind that when all of the cash incentives that are available on leases of it are added together, there is a total of $2,500 in cash allowances that will help you to negotiate a lower capitalized cost.

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CarMan@Edmunds · October 2004

You're welcome, chevyfan88. In your area, GMAC's current 3 year, 15,000 miles per base lease rate and residual value for the 2005 Chevrolet Equinox LT AWD should currently be 4.5% and 56%, respectively. The numbers for an otherwise identical lease of a 2005 Equinox LS AWD would be the same, but the rate and residual for an '05 Equinox LS FWD should be 4.5% and 53%. When negotiating your lease on this truck, keep in mind that General Motors is providing $1,000 bonus cash on vehicles that are leased or financed through GMAC in your area this month. This money will help you to negotiate an attractive capitalized cost.

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cole · October 2004

Can you tell me the residual and MF for a 42 month lease through AHFC? I was quoted 57% and 0.0027x for a 42 month/15k per year lease on an '05 non-navi.

Salesman stated that Acura does not allow dealers to mark up the MF. Is this true?

CarMan@Edmunds · October 2004

Hey marshallcpa. I did some additional research on this incentive and the $1,000 Aero Bonus is indeed for vehicles that dealers take from Port Stock this month. I guess that Saab must have Aeros backing up at the ports. If the dealer that you are working with was able to get you an '04 9-3 Aero from the port then it would qualify for this program and they could get you one that has a manual transmission. I am not surprised that the dealer that you are working with is trying to push a model that it currently has in inventory on you. Dealers always prefer to sell models that they have on their lots to consumers rather than ordering a vehicle for them. The sooner they sell the car that they already have, the sooner they can quit paying floorplan interest on it. Not to mention the fact that a bird in hand is worth two in the bush. If they can sell and deliver the car that they have now to you, they eliminate the risk of having you back out of your order or comparison shopping your deal.

I believe that Saab Financial Services Corp.'s lease money factors and residual values are exactly the same for vehicles with manual and with automatic transmissions.

Saab's lease acquisition fee varies, depending upon what state one is in. I believe that you mentioned that you are in Pennsylvania. If that is indeed the case, SFSC's base lease acquisition fee is $595 in your area. It does not charge consumers any other fees, other than a security deposit that is equivalent to your vehicle's monthly payment rounded up to the nearest $25 increment, which is fully refundable.

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tdevane · October 2004

What is the lease money factor and residual value used for this calculation?

slotmaker · October 2004

Thanks for the advice! No, I didn't take it too hard, trust me. Its a learning experience. By the way, the selling price was $29,700, before the $2700 down. So effective selling price was 27000. Great job on this board and thank you again!

ddelise · October 2004

Hi Car_Man -

I have finally made the decision to move forward with the Toyota Sienna. Now I need to get prepared with the facts!

Can you let me know the 36 and 39 months, 12k miles/yr. money factor, residual, and aquisition fee for:
2005 Sienna XLE FWD
2005 Sienna XLE Limited FWD.

If it matters, I am looking at getting the DVD player if I get the XLE, or no DVD player if I get the Limited.

I am in Florida.

Thanks - Damon

marshallcpa · October 2004

Thanks for the advice on the Aero. I'm going to give my local dealer a chance to get me one out of port if there is a car that meets my specifications (and if they agree to waive the $600 "assignment fee" (e.g. dealer fee) that they are charging, and come clean on the residuals (e.g. manual is same as automatic)). If not, I'll call some dealers in more urban areas to see if anyone is willing to do what I am asking to move a car.

Brian

tommyg12 · October 2004

Pardon me if this question is not appropriate to this forum (I think that it is:)

I have an '01 Toyota Highlander that will be coming off lease in 09/05. The lease buyout is $14,900 with a $432.00 fee and $350.00 sales tax, total of $15,682.

I got a call today from the lease provider, USBank. They want to save me money (uh-hm) by allowing me to purchase the vehicle right now for $20,298.75 (includes the $432 fee, the current due payment of $513, and $350 sales tax). They assure me that this is the best deal (yeah, ok).

Per Edmunds the value is currently 19k, 21k, 23k; trade-in, private party, retail.

Quite honestly, I am confused. Is it really better to buy now for $20k vs. buying in a year for $15,682? Is it possible that USbank would haggle a purchase price? Thanks so much......

(I know that buying out a lease is not financially wise, but things have changed for me and at least I know the history of this vehicle.)

wedgehead98 · October 2004

Car_man - Please help me with the following:

1. What is the MF base lease rate vs. the MF buy rate dealers will quote (e.g., current published 2004 530i base rate of 0.0009 vs. quoted buy rate of 0.0013)?

2. I plan to offer a buy rate of 0.0010. Is this negotiable in the deal? From previous posts, I believe it is but I just want to be clear.

Thank you very much for your help!

John

kat3697 · October 2004

I am interested in buying a 2005 Mercedes Benz SLK350 Roadster or the 2005 Mercedes Benz CLK320 Cabriolet, but I was wondering which purchase would be better - the leasing or the buying outright (no loans)? Is leasing better than buying or getting a loan and what happens at the end of the lease - do I trade it in for a new car or do I have to buy it out? Please help me. I plan on buying the car within the month.

mginter · October 2004

I am looking to purchase a new Z71 Tahoe. I have been looking at the 04 and 05. From what I am seeing the 04's have a much better rebate right now to move them out. However, I'm not sure on what GMAC's lease program is right now. Would it be more beneficial to go with the 04 or 05 in a lease? Also, what are the current residuals and money factors on this vehicle in central Florida? Also, to get a rough estimate of payment assume a modest $10,000 discount on 04 and $8000 off on 05's with MSRP's of $48000 on both. Also, does the 05 have an option of the Navigation system? Thank you for your help.

hpoohh · October 2004

Interested in these cars, would like to get the lease information.

Does anyone know the money factor and residual value for the following cars that i am interested in?

2004 BMW 325i 36mo 10k/yr
2004 BMW Z4 2.5 36mo 10k/yr
2005 MB 230K sedan 36mo 10k/yr

Thank you

topgun7 · October 2004

Sorry about the late response. I used the multiple deposit for a 2002 LS430 and a 2002 SC430. In both cases, I put down 9 month payment worth of security deposit and in return lexus financial reduce the money factor by 0.0009 or 2.16%(each deposit reduce the money factor by 0.0001 or roughly 0.24%). It save us about $100 a month or so in both case. At the end of the lease we get back the deposit. I believe BMW and Volve has the same program as well.

We did not get the RX 330. After we test drove the RX330, we wander into a mercede dealer where my wife know the sales manager and we walked out with a clk 55 convertible instead. So much for doing research and haggle the price..

CarMan@Edmunds · October 2004

That's great news if the dealer that you are purchasing your Expedition from is willing to give you the exact amount of money that you would have to pay to get out of your Pilot lease for it. Of course, this assumes that they aren't over allowing for your trade and not cutting you as good a deal as you normally would be able to get on your new truck.

Let''s work up a sample lease payment on it for you and see what we come up with. According to my calculations, if you were to lease a 2004 Ford Expedition Eddie Bauer 4x2 with a full MSRP of $40,040 and a selling price of $36,400 through Ford Credit this month for 39 months with 12,000 miles per year, your zero down, pre-tax monthly payment should be around $481.

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CarMan@Edmunds · October 2004

Hi alb. If you purchase your leased vehicle at the end of your lease you definitely will not have to pay any sort of penalties for excess wear and tear or excess mileage. In fact, consumers who are way over their allowed mileage on leases often purchase their vehicles in order to avoid having to pay an enormous excess mileage penalty.

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CarMan@Edmunds · October 2004

Thanks for the additional information, BKLN. Let's calculate a sample lease payment on this car and see what we come up with. According to my calculations, if you were to lease a 2005 Honda Civic Value Package with a full MSRP of $15,325 and a selling price of $13,145 through American Honda Finance Corp. this month for 3 years with 12,000 miles per, its zero down, pre-tax monthly payment should be right around $145. This is much less than the payment that you were quoted, so I would want to know why the payment that the dealer quoted you was so high if I was in your situation.

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CarMan@Edmunds · October 2004

You're welcome, njl. The lease money factors would be the same for both the regular Sienna and the Limited, but the Limited models usually have residual values that are 4% to 5% lower than otherwise equivalent base Sienna models do.

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CarMan@Edmunds · October 2004

Hi tdevane. Vehicles' residual values are based upon a percentage of their full MSRPs, but their selling prices are also important when calculating lease payments. You should be able to find out everything that you ever wanted to know about calculating lease payments on vehicles by reading the following article that is available here at Edmunds.com: Calculate Your Own Lease Payment.

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CarMan@Edmunds · October 2004

I have not seen AHFC's 42 month lease program for this car. I can tell you though that the money factor that you were quoted is a little on the high side. AHFC's base standard lease money factor for this term is likely either .00245 or .00220 and would be only .00010 or so higher if you were to have your security deposit waived. I highly doubt that Acura does not allow its dealers to mark-up lease money factors.

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waiter · October 2004

I am looking to find the residual value on my 2002 Ford Escape XLS V6 3 year/75000 mile company car. Trying to figure out whether it would be worth purchasing from my company at the end of the term so I can line up financing early.

Anyone know where I can find this info?

njl · October 2004

Thanks again Car_man.

I've been trying to find a good value and it is very difficult with the popular minivan. The new Honda prices are offensive. The Sienna seems to be a bit more competitive. And the ever popular SUV (Tahoe, Yukon, etc.) seem to command top dollar. Now..I'm in NJ and NJ is the worst. The real estate is over priced for what you get and I guess the car dealers feel we've become accustomed to this kind of treatment.

Thanks

kyfdx · October 2004

I would wonder how you could get over $2K off MSRP on a relatively low-optioned '05 Civic.. Something makes me think that sale price is wrong...

abigfoot · October 2004

Summary:
2001 Chevy Tahoe LT pkg (pretty much loaded out), 44K miles, Clean(good) condition.

Edmunds TMV 17000/19500/21600 (KBB calcs priv party value at 20700).

Lease (Wells Fargo) is up 1/5/05 (3 payments remaining).

Residual value on lease is 19200.

Questions:
With the lease ending on this vehicle my wife and I went ahead and purchased a new 2004 Trailblazer (0% interest + incentives + GM Emp disc were too much to resist).

That leaves us with the Tahoe to deal with. Wells Fargo has already sent one letter (in August) offering to let us purchase for $22k.

I see a couple of options and would like some advice

Option 1: We could buy the vehicle and attempt to sell ourselves. This is something I am very willing to do. At this point we are about 90 days out from the termination date.

I have read that the closer it gets to lease termination the more likely the leasing company is willing to deal on the purchase price.
- Is this generally true? '
- Does anyone know if Wells Fargo is known for "dealing" like this?
- If so, does anyone have any tips for how to accomplish this (i.e. do I call WF? wait for them to call me? what should be a good starting offer?).

If I do go ahead and purchase I also need to factor in sales tax (Texas) so the purchase price + tax needs to be less than (or equal to) the amount I could sell it for (I'd be fine not making a profit and jut ending up with a "wash" transaction....sale price = costs).

Option 2: is to simply let the lease run out and turn the vehicle back in. This would cost us the remaining payments (3) plus the disposal fee ($250). We then would be subject to any fees found after inspection.

The vehicle is truely in good (normal wear) condition. What worries me about this option is A) paying out the remaining payments on a vehicle we are no longer using and

not knowing (or controlling) what WF may deem needs to be repaired and thus the fees they might assess.
- Does anyone have prior experience with WF and their lease termination?
- If so, are they generally "fair" in assessing fees (i.e. they won't gouge and make up false "needed repairs)?

Thanks, in advance, for any tips/help.

CarMan@Edmunds · October 2004

You're very welcome, slotmaker. If the selling price didn't take your down payment into account then you got a good deal afterall. Let me know if you have any other questions.

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CarMan@Edmunds · October 2004

Good choice, Damon. The Toyota Sienna and the Honda Odyssey are the two best minivan models as far as I am concerned and the redesigned 2005 Odyssey is way too expensive to lease right now. In your post you mentioned that you are in Florida. This is unfortunate, not because all of the storms that you have been having, but because you are in Toyota's Southeast region. As you may already be aware, Toyota vehicles in the Southeastern United States are sold through an independent distributor that gets all of the vehicles from Toyota before they are distributed to dealers. This is a problem because not only does this distributor add all sorts of charges and options that most consumers do not need or want to vehicles, but it also has its own finance company, Southeast Toyota Finance. I have not seen SE Toyota Finance's lease program recently and will not be able to give you an idea of what this model's current lease program is like in your area.

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CarMan@Edmunds · October 2004

No problem, Brian. Good luck and make sure to let me know if you have any other questions.

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CarMan@Edmunds · October 2004

Hi tommyg12. This is a question about your lease, so you have come to the right place. Many banks will indeed negotiate the selling prices of leased vehicles. In order to find out if your bank is willing to work with you, you need to speak with someone there who has the authority to work with you. If your initial contact there will not lower your vehicle's selling price, you may have better results if you work your way up the ladder a notch. There definitely is no guarantee that they will be willing to work with you, but you don't have anything to lose by asking. It certainly sounds as though they are trying to whittle down their lease portfolio.

It is difficult to say if the current price that you were quoted for your truck is better than the lease-end purchase price that is in your lease contract because we won't know what your truck's value is like in September of next year until that time arrives.

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CarMan@Edmunds · October 2004

Greetings John. All of the lease money factors that I provide to consumers in this discussion are banks' base lease money factors, i.e. the lowest factors that dealers are allowed to use to calculate your vehicle's lease payment. Most dealers are allowed to mark-up banks' base money factors up to a certain amount to add additional back-end profit to deals. BMW dealers do so all the time. Just because they frequently do so does not mean that they will not lease you the car or truck that you are interested in using the lowest money factor. There is enough competition for your business out there that most dealers will use banks' lowest factors in their calculations when confronted with the actual number. It is in your best interest to negotiate the lowest selling price that you can for the vehicle that you are interested in and insist that your dealer uses the base money factor to calculate your payment.

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CarMan@Edmunds · October 2004

Hello kat3697. Mercedes-Benz is not currently providing any sort of lease support on either of the convertibles that you are interested in. So if you were to lease them through Mercedes-Benz Credit Corp., Mercedes' captive finance company, you would have to use its standard lease money factors. The last time that I heard what it was, MBCC's base standard lease money factor was equivalent to an interest rate of around 7.4%. As a result, I personally feel as though you would be better off financing or paying cash for these cars.

If you were to lease one of them, at the end of your lease you would just walk away from your car without having to pay anything, assuming that you did not owe a penalty for excess wear and tear or excess mileage. You would not be able to trade in your leased car on a new one unless you were to purchase it from the bank that you are leasing it through first.

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CarMan@Edmunds · October 2004

Hi mginter. General Motors is no longer leasing 2004 models through its captive finance company, General Motors Acceptance Corp. It is not unusual for automakers to stop leasing vehicles late in the model year because by that time their residual values have fallen to the point that they become fairly expensive to lease unless a ton of lease support is provided on them. If you were to lease an '04 Tahoe, you would have to do so through an independent bank, if there is one that is still leasing '04's.

If you were to lease a 2005 Chevrolet Tahoe through GMAC in Florida right now for 3 years with 15,000 miles per, its base lease rate and residual value should be around 5.5% and 53%, respectively. As you can see, GMAC publishes what are known in the industry as lease rates instead of money factors for the vehicles that it leases. You can convert the aforementioned money factor into an approximate money factor equivalent by dividing it by 2400. When negotiating your lease on this truck, keep in mind that General Motors is providing $1,500 bonus cash on lease and finance deals of it through GMAC in your area right now. This money will help you to negotiate an attractive selling price. There are no other cash incentives available on leases of this truck.

I think that you are being a little optimistic with the "modest" discounts that you are assuming on these trucks. Taking the bonus cash into account, there is only a spread of slightly over $6,000 between the full MSRP and dealer invoice price of a base 2005 Tahoe 4WD. I would be more than happy to work up a sample lease payment on this truck for you if you provide me with an exact MSRP and selling price.

A navigation system option is available on the 2005 version of this truck.

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CarMan@Edmunds · October 2004

Here is the information that you are looking for. If you were to lease a 2004 BMW 325i through BMW Financial Services right now for 3 years with 10,000 miles per, its base lease money factor and residual value should be .00220 and 62%, respectively. When negotiating your lease on this car, keep in mind that BMW is providing $1,500 dealer cash on it that will help you to negotiate a more attractive selling price. The numbers for an otherwise identical lease of a 2004 BMW Z4 2.5 should be .00200 and 53%, respectively. BMW has a whopping $5,000 dealer cash on this car.

If you were to lease a 2005 Mercedes-Benz 230K Sport Sedan through Mercedes-Benz Credit Corp. this month for 3 years with 10,000 miles per, its base lease money factor and residual value should be .00225 and 50%, respectively.

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CarMan@Edmunds · October 2004

Hi waiter. In order to find out how much money it will cost to purchase this leased vehicle, you need to place a call to the bank that it is being leased through. Since this is a Ford product, there is a good chance that the bank is Ford Motor Credit. I think that the number for Ford Credit's customer service center is 1-800-727-7000.

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CarMan@Edmunds · October 2004

You're welcome again, njl.

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CarMan@Edmunds · October 2004

Hi abigfoot. While there certainly is no guarantee that your bank will be willing to negotiate your leased vehicle's purchase price with you, generally speaking one's chances of having a bank work with them increases as they get closer to the scheduled end of their lease and their bank faces the prospect of getting back a car or truck that they do not want. Place a call the Wells Fargo and see if they are willing to negotiate. If your initial contact there is not, you may be able to get better results by working your way up the ladder a rung. Again, there is no guarantee that they will be willing to lower your vehicle's price, but you don't have anything to lose by asking.

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jsy · October 2004

Hi. You offer a great service. For a 3 year, 10,000 miles/year lease of a '04 Saab 9-5 Linear wagon, can you give me the October money factor, residual, lease assistance/cash, standard acquisition fee and security deposit? Thanks in advance.

John

wasabi911 · October 2004

Hi Car Man,

My mom in considering leasing a 2005 Lexus ES 330 in the NY area. She is interested in either the basic model w/o Nav or the fully loaded model w/ the Nav and ML sound system.

Can you tell us the lease factors and residuals for a 3yr/12k mi and a 3yr/15k mi lease?

She was wondering if there are any lease deals going on currently. Since she is not in a rush, she was wondering if you think the lease deals would be much better during the annual Lexus "December to Remember" promotion.

We sincerely appreciate your help

slotmaker · October 2004

Thank you again, Car_man, and great job!

brettv1 · October 2004

I have a 2001 Jeep Cherokee in which the lease ends in November. I do not plan on purchasing the vehicle. I am interested in leasing a new '04 or '05 Cherokee for three yrs. At the time I turn in my vehicle, should I then start the negotiations for a new vehicle? Or should I start that process earlier? Being a current Cherokee owner, am I eligible for any kind of loyalty rebates? If I start my negotiations now, should I inform the salesperson that I am currently leasing a Cherokee?

Thanks

bfann · October 2004

looking to wrap up a lease on a 2004 MDX with Touring package. can you comment on the following:

msrp: 39570
money factor 36 month, no security dep: .00204
money factor 48 month, no security dep: .00240 cap cost: 37000 + acquisition fee 595= 37595
first month and license fee and doc fee down only 36 month lease including taxes: 556 per month
48 month lease including taxes: 547 per month

is it normal to have a higher money factor on the 48 month lease versus the 36? is this really the best i can do? seems high to me. thanks much

momof2 · October 2004

Hi Car_Man,

I'm in Arizona and starting my research for my first minivan. Never thought I'd own one....however, I do like the '05 Toyota Sienna. I came across this forum and thought I'd ask you if you know the MF and RV's for my area. I'm looking at the LE model. I apologize if you've mentioned this somewhere, but I am a first timer to this and am having a hard time finding it.

THANKS for your help!

navigator2 · October 2004

I am leasing a 2002 Navigator and discovered that my lease agreement is for 12K miles per year and I am now at the end of my lease and I have 47K miles. The cost per mile is 20 cents...Is this a negotiable item when I turn the vehicle in to the dealer?

Thanks for your help!

anonymousposts · October 2004

Probably not. The only way to avoid the excess mileage charges would be to buy the vehicle from the leasing company.

yrneh1 · October 2004

My 2004 MDX w/touring NAV lease terms...

$1000 drive off (inc. $117 cap. reduction)
$534 per month including tax (7.75%)
36mo/36k lease

negotiate hard...cap. cost should be lower...

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